Why is Switzerland so Successful in Medtech?
June 07, 2013
Switzerland might have been created just to be successful at Medtech. Medical Technology is an industry that suits Switzerland even more than watch making, which itself has benefited the Medtech industry with its ready resource of innovation and precision engineering skills.
By most realistic comparators, Switzerland is ahead of other countries worldwide in Medtech, garnering from the industry enviable growth rates, high employment levels and a significant contribution to GDP and exports. The range of products developed and manufactured in Switzerland is diverse, from implants, hearing aids and diagnostics through to lab instruments, surgical systems and IT assisted operative devices.
Medtech is a challenging industry, requiring expertise across a number of disciplines including medicine, engineering and electronics. Currently there are about 1600 Medtech companies in Switzerland and over 50,000 workers. The character of the industry is diverse, incorporating a wide variety of companies from global giants such as Zimmer, Medtronic and Stryker to sophisticated design and marketing groups. The success of the industry also rests on a number of small family businesses supplying components created with the precision engineering skills that have made the country’s watchmakers famous.
Switzerland has the highest density of Medtech enterprises per capita in the world. The underlying elements that contribute to this success are not difficult to ascertain. The organised, focused and serious character of the Swiss culture is ideally suited to the multifaceted, fast moving product life cycle of the Medtech industry. Educational standards are high, both at University and in the country’s technical colleges and well run apprenticeships are common. There is no doubt that among all the expertise that Switzerland possesses in the Medtech industry, its superior manufacturing skills, including in the area of additive manufacturing, play a key part in its success.
The healthcare system – paid for by private insurance – is high cost and high quality and readily embraces advances rather than creating barriers and restrictions. This is aided by a population that takes responsibility for its health and rarely abuses the system. There is minimal government interference or wasteful ‘help’. Instead there is genuine support to drive exports (barring of course the hurdle of the strong Swiss Franc). This energy delivers products to market faster, in spite of the growing regulatory pressures that face the industry overall.
Financial backing for start ups – and every type of Medtech company – is readily available from Angels, VCs , Private Equity and even banks, with investment delivered on the understanding that a business should be built for long-term viability not quick returns.
Of course there are some obstacles to Switzerland’s progress in Medtech. The country is small, yet the market is potentially limitless; as such, Switzerland will struggle to find enough diversely skilled people to maintain its growth. This can already be seen in the way that the Swiss pharmaceutical industry has had to import individuals to grow and maintain its R&D and sales exports.
Yet this has proved a small bar to success. Switzerland’s expertise is such that with ongoing drive and determination, there is no reason that the country’s Medtech industry should not overcome these hurdles and continue to flourish.