A medtech market in evolution:

Spain, a country both ancient and ultra-modern

While the mere mention of its name conjures up images of Moorish temples, ancient windmills and Flamenco dancers, Spain is also a country which has been modernizing rapidly and is now on the leading edge in many sectors of the world economy.

A vibrant economy
The country has seen the fastest economic development in Western Europe since the 1960’s. It’s economy is the eighth-largest in the world, and the fifth-largest in Europe. Regarded as the country with the highest quality of life in Europe, Spain has a very high standard of living, and is now surpassing other comparable developed countries such as the UK, Germany, and Italy. After a steep plunge in late 2008 and throughout 2009, the economy stabilized in the first quarter of 2010.

Decentralization changed everything
With a population of about 40 million and a healthcare expenditure of 7.5 percent of the total GDP, Spain has seen its healthcare system experience great changes in recent times. The most significant of these changes has been decentralization of the country’s 17 regions. Started in 1981, the decentralization process culminated in January 2002 and lead to a significant change in the healthcare scenario of the whole country. Decentralization gave regional healthcare authorities the autonomy to plan, change and upgrade the infrastructure thereby leading to enormous development in the healthcare technology scenario especially in the usage of information technology, which had earlier taken a back seat in terms of technology advancement. The present 17 comunidades are rising to the challenge by upgrading the healthcare infrastructure to make the system more efficient both for the healthcare provider and the patient. This is spurring tremendous opportunities in the healthcare IT sector across the whole country.

The majority of healthcare services in Spain are owned by the regional health service, which is part of the public healthcare system. Although public hospitals account for only about 39.0 percent of the total hospitals in Spain, they contribute up to about 69.0 percent of the total hospital beds. In certain regions like Catalonia, private hospitals contribute up to 31 percent of the total hospital beds. But it is the public healthcare system, which caters to the majority of the citizens. Adding to the healthcare expenditure is the fact that the finance for the regional healthcare system is from the taxes paid by the citizens and there are many immigrants, who also benefit from the low cost of healthcare in the country.

Modernizing the healthcare system
Prior to the decentralisation, Spain’s central government controlled all health planning decisions for the country. Since then, the healthcare system has improved in terms of both efficiency and distribution of health services. One of the reasons for this improvement is that the regional healthcare systems are more capable in adapting themselves to specific healthcare demands and regional preferences. This is leading to increased development as all regions are making investment decisions for new healthcare solutions. As a result, the regions have successfully developed a frontline healthcare system network. A new law on “Cohesion and Quality of the National Health System,” further accelerated the growth of the healthcare system by establishing three basic principles of equity of access, quality guarantee and citizens participation. This change has led to the regional governments looking for new techniques to modernise their healthcare system. The regional governments have realised that they could abide by the law by successful adoption and implementation of e-health tools. This would be working towards implementing systems to facilitate seamless data flow, thus making the healthcare system more efficient.

Spain’s medical device industry
Valued at US $4.8 billion in 2010, the
 Spanish medical market ranks fifth in the EU-27 and eighth in the world. Nevertheless, medical spending per capita is on the low side for an EU-27 country. Over 80% of medical production is exported, therefore imports represent the majority of the market. As a result, Spain has one of the world’s largest medical trade deficits. Consumables are the largest medical sector, followed by orthopaedic & implantable products, diagnostic imaging apparatus and dental products.

Net medical production was valued at US$1.5 billion of which exports amounted to US$1.3 billion in 2008.


Spain has a strong medical device manufacturing sector, which tends to be based around Madrid and Barcelona. Companies, however, tend to be small and concentrated at the low to medium technology end of the market. Major export categories included medical supplies, syringes, needles & catheters and X-ray equipment. Morpheus Medical is one of the latest acquired Spanish producers; Aircraft Medical, an Edinburgh-based medical devices company, announced this acquisition in May 2009.



A sector monopolized by foreign companies
Medical imports rose by 5.1% in 2008, reaching US$4.2 billion.
Most of the medical market is supplied by imports, mainly from the USA and other EU-27 countries; leading EU-27 countries are Germany, the Netherlands, France, Belgium and the UK. Imports of consumables represent the leading individual import category, equal to 20.9% of the total. Orthopaedic & implantable products represented 18.3% of total imports.



Spain had 804 hospitals in 2008, of which 319 were public and 485 private.
Health services in Spain have been decentralised since 2002, thereforethe medical industry needs to liaise with 17 regions separately. Increased regional autonomy has resulted in greater medical equipment disparities. In 2009, Spain has around 6,000 high-end technology equipment units, mainly including CAT, MRI and mammography units. There are 50 operational PET units, of which half of them are PET-CAT. Also, there are 140 centres with nuclear medicine units. 

The diagnostic imaging sector is monopolized by foreign companies.


In June 2009, the Hospital de la Santa Creu i Sant Pau in Barcelona signed a ten-year agreement for Philips Healthcare to manage the imaging technology needs of the hospital's imaging diagnostics department at a fixed monthly fee. The agreement includes management of equipment from imaging specialties including MR, CT, nuclear medicine, X-ray and ultrasound. As a result of the agreement, Hospital Sant Pau will become an international reference site for Philips Healthcare, a major move in a sector dominated by foreign companies.

DFAIT funds are a promising first step
Canada’s medical technology sector has so far left a very small footprint in Spain’s healthcare market. This is a situation which Canada’s Foreign Affairs and International Trade Ministry hopes to change by offering to pick up the tab for some of the costs involved in meeting and dealing with Spanish healthcare authorities and business interests.  While very modest in size, this funding is a promising first step in assisting Canadian medical device manufacturers to venture forth into a market with considerable potential for growth. Precise details about a mission to Spain have yet to be determined but TMTA is anticipating to lead a first group  in early to mid February 2011. Funds will be available to any medical technology company from anywhere in Canada. TMTA hopes that Ontario manufacturers will take advantage of this opportunity by responding enthusiastically and registering early. Any company interested in registering or wanting more information about the Spanish market and a medical device mission can contact TMTA by phoning Marcel Lafleur at 905.888.1273, x 331 or emailing marcel@tmta.ca  

Alarm Bells About Chemicals and Cancer

The US President’s Cancer Panel is the Mount Everest of the medical mainstream, so it is astonishing to learn that it is poised to join ranks with the organic food movement and declare: chemicals threaten our bodies.

The cancer panel is releasing a landmark 200-page report on Thursday, warning that our lackadaisical approach to regulation may have far-reaching consequences for our health. The report is an extraordinary document. It calls on Americans to rethink the way they confront cancer, including much more rigorous regulation of chemicals.

Traditionally, cancer risk is reduced through regular doctor visits, self-examinations and screenings such as mammograms. The President’s Cancer Panel suggests other eye-opening steps as well, such as giving preference to organic food, checking radon levels in the home and microwaving food in glass containers rather than plastic.

In particular, the report warns about exposures to chemicals during pregnancy, when risk of damage seems to be greatest. Noting that 300 contaminants have been detected in umbilical cord blood of newborn babies, the study warns that: “to a disturbing extent, babies are born ‘pre-polluted.’ ”

It’s striking that this report emerges not from the fringe but from the mission control of mainstream scientific and medical thinking, the President’s Cancer Panel. Established in 1971, this is a group of three distinguished experts who review America’s cancer program and report directly to the president.

One of the seats is now vacant, but the panel members who joined in this report are Dr. LaSalle Leffall Jr., an oncologist and professor of surgery at Howard University, and Dr. Margaret Kripke, an immunologist at the M.D. Anderson Cancer Center in Houston. Both were originally appointed to the panel by former President George W. Bush.

“We wanted to let people know that we’re concerned, and that they should be concerned,” says Professor Leffall.

The report blames weak laws, lax enforcement and fragmented authority, as well as the existing regulatory presumption that chemicals are safe unless strong evidence emerges to the contrary.

“Only a few hundred of the more than 80,000 chemicals in use in the United States have been tested for safety,” the report says. It adds: “Many known or suspected carcinogens are completely unregulated.”

Industry may howl. The food industry has already been fighting legislation in the Senate backed by Dianne Feinstein of California that would ban bisphenol-A, commonly found in plastics and better known as BPA, from food and beverage containers.

Studies of BPA have raised alarm bells for decades, and the evidence is still complex and open to debate. That’s life: In the real world, regulatory decisions usually must be made with ambiguous and conflicting data. The panel’s point is that we should be prudent in such situations, rather than recklessly approving chemicals of uncertain effect.

The President’s Cancer Panel report will give a boost to Senator Feinstein’s efforts. It may also help the prospects of the Safe Chemicals Act, backed by Senator Frank Lautenberg and several colleagues, to improve the safety of chemicals on the market.

Some 41 percent of Americans will be diagnosed with cancer at some point in their lives, and they include Democrats and Republicans alike. Protecting ourselves and our children from toxins should be an effort that both parties can get behind — if enough members of Congress are willing to put the public interest ahead of corporate interests.

One reason for concern is that some cancers are becoming more common, particularly in children. We don’t know why that is, but the proliferation of chemicals in water, foods, air and household products is widely suspected as a factor. I’m hoping the President’s Cancer Panel report will shine a stronger spotlight on environmental causes of health problems — not only cancer, but perhaps also diabetes, obesity and autism.

This is not to say that chemicals are evil, and in many cases the evidence against a particular substance is balanced by other studies that are exonerating. To help people manage the uncertainty prudently, the report has a section of recommendations for individuals:

¶Particularly when pregnant and when children are small, choose foods, toys and garden products with fewer endocrine disruptors or other toxins. (Information about products is at www.cosmeticsdatabase.com or www.healthystuff.org.)

¶For those whose jobs may expose them to chemicals, remove shoes when entering the house and wash work clothes separately from the rest of the laundry.

¶Filter drinking water.

¶Store water in glass or stainless steel containers, or in plastics that don’t contain BPA or phthalates (chemicals used to soften plastics). Microwave food in ceramic or glass containers.

¶Give preference to food grown without pesticides, chemical fertilizers and growth hormones. Avoid meats that are cooked well-done.

¶Check radon levels in your home. Radon is a natural source of radiation linked to cancer.

China’s healthcare reform one year later: What’s changed?
By InMedica Research | March 16, 2010

Wellingborough, U.K. (March 16, 2010)—In April 2009, the Chinese government announced guidelines for healthcare reform, with the core goal of providing universal healthcare services to the country’s 1.3 billion people. China will invest RMB850 billion ($124 billion) on healthcare from 2009 to 2011, further stimulating demand for medical devices, in what is already one of the world’s fastest growing markets for medical technology. One year later, a number of new regulations and guidelines are in place that are beginning to reshape the structure of the Chinese healthcare industry.

Buy China initiative favours local suppliers
InMedica predicts that the main winners in the medical devices market will be suppliers of basic equipment, such as general-purpose ultrasound machines, analog x-ray equipment, and patient monitors, which are all funded by the healthcare reform. Chinese companies such as Mindray, Beijing Wandong, and Yuyue Medical will benefit the most, as local suppliers are preferred by the government due to the “Buy China” initiative.

Universal coverage by 2020
While the government has not released details of how the investment in healthcare reform will be distributed, InMedica believes that around 50% will be used to expand the coverage of medical insurance, 30% will be used for the construction of rural healthcare systems, and the remaining 20% will be used to fund public hospitals. It is the first time that basic healthcare will be provided as a public service for all people in China, and the Chinese government aims to solve the problems that have caused strong complaints from the public about high medical costs. The overall aim is to provide basic medical services to the population by 2011, with the long-term goal of rolling out universal coverage by 2020. The healthcare reform relies on joint funding by central and local governments. The central government will contribute around 40% of the total investment.

Guidelines cover everything
Public nonprofit hospitals will remain the major provider of healthcare services, but more priority will be given to the development of grassroots-level hospitals and clinics. The central government will fund the construction of 2000 county-level hospitals and 29,000 township hospitals and the upgrading of 5000 township hospitals. Furthermore, about 3700 community health centers and 11,000 community health stations will be established or upgraded by 2011.

Since the reform was announced last April, a series of regulations and guidelines has been released. In June, the guideline on the construction of county hospitals, health centers, community health service centers, and village clinics was released; in October, the guideline on the price of essential drugs was released; and in January, a guideline on training and development of village physicians was released. Most recently, in February, the guideline on the reform of public hospitals in 16 pilot cities was released.

Market-oriented approach have resulted in soaring costs
Public hospital reform was one of the key issues of the guideline. Currently, public hospital revenues are derived from drug sales, medical services, and government funds. In 2007, the total revenue of public hospitals in China was RMB375.4 billion, including RMB200 billion from sales of drugs. In the same year, funds from the government were RMB28.5 billion, which was only 7.6% of total revenues. Currently, public hospitals are permitted to make a 15% profit from drug sales. Whilst this market-oriented approach has greatly improved medical services in recent years, it has also resulted in soaring medical costs for the Chinese public.

According to the guideline, the 15% profit from drug sales will no longer be permitted. However, it is thought that government funding alone cannot fully meet the financial gap, especially in the western regions.

“With limited government funding available, it is unknown if the public hospitals can maintain standards of care without the revenues from drug sales,” said Owen Tang, market analyst at InMedica. “This is why the government has chosen 16 cities to pilot the reform. The cities, including six in central China, six in the east, and four in the west, were asked to start the reform from this year. The government will need time to evaluate the success of these early trials, and possibly conduct more trials with refined guidelines, before the healthcare reform can be rolled out on a national level. Despite the impressive headline investment figures, China’s healthcare reform is likely to be a lengthy process.”

USA: Guidance on good importer practices
The FDA (Food and Drug Administration) and several other US government agencies have drafted a guide on good importer practices to help ensure that health products finding their way into the US meet required standards. The draft guidance recommends that importers consider instituting practices to identify and minimize risks associated with imported products. The draft guidance also recommends that, in general, importers should know the producer of the foreign products they purchase and any other manufacturers, such as trading companies or distributors, with which they do business. The FDA has been under pressure to strenghten the oversight of health products finding their way onto the US market following safety concerns surrounding health products imported from China India. The draft can be found under: Good Importer Practices - Draft Guidance.



Tanzania: Steps to establish a regulatory framework
The TFDA- Tanzanian Food and Drugs Authority has announced plans to establish a new regulatory framework for medical devices. Devices will be clasified according to the risk-based classification principles of the Global Harmonization Task Force and compulsory registration will be required for all products. The TFDA has framed guidance on evidence documents that companies would have to produce to register their devices. The agency is also seeking data of all imported products to control these devices during the transition period. Device importers have to submit all necessary information to the TFDA by 31 August.



EU: Guidance on clinical evaluation of stents
The European Commission issued the final guidance on the clinical evaluation of coronary stents, which describes the main requirements fort the clinical evaluation of this group of Class III medical devices. The guidance covers bare metal stents, drug-eluting stents and other innovative stents. The guidance is included as an Appendix to MEDDEV 2.7.1 on guidance to manufacturers and notified bodies on evaluation of clinical data. The document covers preclinical assessment, clinical investigation, evaluation of clinical data supporting CE marking, postmarket clinical follow-up and modifications to stents or indications for use. In terms of clinical investigation, the guidance recommends a minimum timeline for six months in general for bare metal stents and a minimum of 12 months for drug-eluting and other innovative stents. Each claim modification should be approved by the relevant notified body. The guidance can be download under: Guidance - evaluation on clinical data. 
 

China: New rules on adverse incident reporting
SFDA – China’s State Food and Drug Administration has issued interim rules that strengthen adverse event reporting requirements for medical device manufacturers, distributors, medical device users, technical institutions for medical device adverse monitoring, food and drug regulatory departments and other relevant authorities. The new rules also introduce the first-ever device re-evaluation procedures and came into effect on 30 December 2008. The SFDA is responsible for nationwide monitoring of adverse incidents and re-evaluation activities.

The regulation requires that manufacturers, distributors and medical end users establish an adverse event reporting system, which includes appointment of a responsible person for adverse incident reporting and management and the event records must be maintained for two years after the end of the product’s life-cycle. The regulation also specifies strict reporting timelines, f.ex. for an incident that has resulted in death manufacturer has to submit a special report within five business days.

Manufacturers of Class II and III (medium- to high-risk) devices must prepare a Medical Device Adverse Incident Annual Summary Report, which summarises adverse events in the previous year and submit to the relevant authorities (provincial technical evaluation agency) before the end of January each year. Under this regulation the Class III and imported devices are re-evaluated by the SFDA; Class I and II domestic devices are evaulated by provincial food and drug agencies .



Food and Drug Admin to become a more efficient and transparent operation
As previously reported in our Asia Medical eNewsletter, the Taiwan Food and Drug Administration (TFDA) will combine the Bureau of Food Safety, Bureau of Pharmaceutical Affairs, Bureau of Food and Drug Analysis, and Bureau of Controlled Drugs in order to better integrate the management of food and drug safety.

The TFDA will run a single-window operation to increase efficiency, decrease processing time, and improve transparency. In the future, instead of applying for medical equipment registration to different agencies depending on the type of device, medical device companies can send product information directly to the TFDA. Additionally, the TFDA will manage all import inspection, while routine inspections will be managed by the private sector.

The TFDA will also run a single-window operation for new drugs. Currently, new drugs are inspected by three institutions: the Bureau of Pharmaceutical Affairs, Center for Drug Evaluation (CDE), and the Bureau of Food and Drug Analysis. Once the TFDA is established, all data pertaining to new drugs can be submitted to the TFDA. The TFDA will then relay new drug technical data over to the CDE for further review. Companies will be permitted to request the status of the application at any point during the process. Deputy Minister Yan-Jen Sung states that this single-window approach will reduce the processing time from the current 230 days to less than 200 days.



DCC and DTAB approve new regulations for medical devices

In June 2009 the Drug Consultative Committee (DCC) and the Drug Technical Advisory Board (DTAB) approved new formal regulations for India’s medical device sector. The new regulations have been sent to the Ministry of Health for final notification, which is expected soon.

As of yet, India’s medical device sector has been largely unregulated. There is currently no specific definition for medical devices, and only certain devices are regulated as drugs by the Drug Controller General of India (DCGI). The new regulations will provide a specific definition for medial devices and create a formal category for medical devices separate from drugs. The DCGI will expand its medical devices wing to enforce stricter oversight on the import and manufacture of medical devices. In March 2009, the DCGI proposed 19 additions to the list of medical devices requiring registration. The number of additions is expected to expand to 49 new categories of medical devices with the new regulations.

The new regulations were devised by a task force consisting of trade bodies such as the Indian Chamber of Commerce and Industry and the Confederation of Indian Industry. The task force was advised by the World Health Organization, the United States Food and Drug Administration, industry experts, and public opinion.

 

Strong ratings for healthcare companies
Medical device companies got a clean bill of health from Standard & Poor’s, but they’ll soon require a follow-up appointment. The good news from S&P’s Rating Services is that, so far in 2009, it has upgraded nearly double the amount of healthcare companies that it has downgraded.

The industry report, “North American Health Care Companies Remain Vital, But Require Observation,” says that essential medical products and services are continuing to pump up healthcare companies. However, it notes that a changing political landscape and slumping economy pose many risks to the industry.

Medical device makers St. Jude Medical and Covidien are among the strongest performers of 2009, an article in the Wall Street Journal says.

Brazil’s economy and healthcare system have been undergoing major transformations in the last decade. As a result, the Brazilian government is now allocating more funds for retro-fitting all of the country’s hospitals. This move is resulting in a substantial increase in purchases of new technologies. Since Brazil has few in-country medical products manufacturers, the situation offers great potential for Canadian manufacturers to increase exports and boost sales. 

A ground-breaking mission
Canadian companies can benefit greatly by getting in on the action as soon as possible. As with all new markets, firms that benefit the most will those who get in on the ground floor. TMTA’s strategy has been to align itself with ABIMO (Brazil’s national medical and dental device association) and Canada’s consulate in Sao Paulo to launch “Brazil 2009”, TMTA’s first medical technology mission to South America. As of today, registrations is open to all Canadian Companies interested in doing business in this major emerging market. 

The Mission took place from June 1 to June 5 and coincided with Hospitalar 2009, Brazil and South America’s largest medical device show. The visit featured "one-on-one" meetings with potential distributors and a session devoted to walking the floor of the Hospitalar Exhibition in Sao Paolo. Participating companies had the opportunity to have a first hand look at the type of products in use by Brazilian hospitals and explore specific markets for Canadian manufacturers.

The Mission included meetings with public and private healthcare administrators and visits to a public and a private hospital to examine the type of technology used in the Brazilian healthcare system. There will also be presentations from experts on Brazilian regulations and meetings with Brazilian Government officials to explore the government’s ambitious plan to substantially improve Brazil’s healthcare delivery system.

Get in on the action now
Four TMTA member companies were part of the 2009 mission. Other companies wishing to be in on the action in 2010 should contact us right away as participation will be limited to a group of no more than 10 companies in order to make the mission more manageable. Some financial assistance may be available from Foreign Affairs to defray certain costs but details await a confirmation from Foreign Affairs.

Consider entering the Brazil market. Not only will your firm be among the first to explore medical  technologies used in Brazilian hospitals, you will also have a big say in shaping the future of Canada’s trade with Brazil and be among the first to reap its benefits. One of the goal of the mission is to is to advise Canadian manufacturers on what markets to target in order to achieve sales and increase exports to Brazil, accumulating practical, useable market intelligence for the medical technology industry.

To register or enquire about details, drop us an email at marcel@tmta.ca Since this mission enjoys the support of medical technology associations across Canada, companies outside Ontario can contact their provincial association.

Keep checking this page for updates. Reports on the 2009 mission will be posted here as soon as they are available.

BioPharm America™ is the place to meet with AstraZeneca, Bayer Schering, Exelixis, Genentech, Gilead, Johnson & Johnson, Merck & Co., Inc., Pfizer, Takeda, UCB and many more pharma and large-cap biotech companies hunting for deals.

As a participant of BioPharm America you will benefit from partneringONE™, the industry partnering platform, to screen hundreds of potential partners and easily schedule pre-arranged meetings. 

Three easy steps to be part of the action:

1.     Register
2.     Browse a large pool of licensing opportunities and identify potential partners
3.     Pre-arrange private one-to-one meetings

Conference links:

* View the Preliminary BioPharm America Program
* View the list of Presenting Companies to date
* View the BioPharm America 2009 Sponsors
* View the pre-conference program: ChinaBio Day 2009

To register: Martina Rannertshauser, EBD Group
mrannertshauser@ebdgroup.com

Medical Device Product Liability and Serious Derivative Risks
Arising from Miscommunications and Failure to Warn Seminar

Product Liability Seminar
September 10, 2009
Morgan Lewis Offices
Philadelphia, PA

Medical device companies do their utmost to design and manufacture products that are safe and effective for their intended therapeutic purposes, and through appropriate labeling, instructions, and training try to guarantee that they are used in the right way.  But in an imperfect world, things do happen, and too often they result from inaccurate, inconsistent, or improper communications, misunderstandings on the part of the users, or representations made outside of the manufacturer's control.  Such problems, when linked to patient adverse events, can result in "failure to warn" product liability actions that are potentially devastating to companies.

In this unique conference, experts from law firms, the medical technology industry, and the insurance field review the medical device product liability landscape, present and emerging legal trends, areas of greatest potential risk, and best practices for companies to monitor and assess the myriad representations made about their products.

Speakers include:
John P. Lavelle, Jr., Partner, Morgan Lewis
Brian W. Shaffer, Partner, Morgan Lewis
Marta L. Villarraga, Ph.D., Exponent Medical Device & BioEngineering
Sara Dyson, Loss Control Manager, Medmarc Insurance Group
Joseph Coray, AVPt, Technology Practice Group, The Hartford
Kenneth Ross, Counsel, Bowman and Brooke
M. Elizabeth Bierman, Partner, Morgan Lewis
Kathleen McDermott, Partner, Morgan Lewis
Additional Speakers TBA

General Information:

This seminar will take place at the Philadelphia offices of Morgan Lewis, located at:
1701 Market Street
Philadelphia, PA
215-963-5000 - phone

Please be advised that there are no hotel room blocks associated with this seminar.