Shotgun Marriage? How Medical Device Manufacturers Can Thrive in an Era of Mergers and Acquisitions

Written By: Robyn Gold
  • 8/9/2017

It’s a complex world – and only getting more complicated. Consider that IDC predicts 70% of global discrete manufacturers will offer connected products by 2017. McKinsey and Cisco project 50 billion devices and $6 trillion in economic value for smart connected products by 2025. 

What to find out more? Read the tech-clarity Software Selection Guide For Medical Device Manufacturers

Smart connected products can deliver value in the form of new insights and efficiencies that are triggering the medical device industry to rethink business models. The shift from fee for service to payment for outcomes is one key driver. So too is the appeal of lower health care costs afforded by remote monitoring and delivery of patient care.  According to study from GE, a 1 percent IoT-generated reduction in healthcare system inefficiencies could bring about savings of $63 billion over a 15-year period.”

Shifting business models compel manufacturers to reassess the competencies they will need to succeed in the new world order. Many are filling in the missing pieces through mergers and acquisitions (M&As) as evidenced by the steady pace of M&A activity in the medical device industry.


As larger companies absorb startups, the operating environment is often thrown into chaos. The multiple product lifecycle management (PLM), manufacturing execution systems (MES), enterprise resource planning (ERP), customer relationship management (CRM) and other systems result in a sprawling matrix of disconnected systems and different processes. All of this further compounds the product complexity introduced with IoT. At the same time, medical device manufacturers must attend to global emerging standards and harmonize international regulations (e.g., EUMDR) across their operations.


Family Planning Guidelines

Mergers and acquisitions are often described as shotgun weddings. Beyond the initial burst of enthusiasm comes the hard work of knitting together disparate workforces, cultures, languages, often across time zones. Unifying enterprise processes and supporting software systems are especially critical to success.

Many are taking a cue from their past experiences consolidating ERP systems as part of their M&A activities. Those that successfully integrated these systems saw tremendous benefits. Essentially, they provided their employees with a single source of “truth” that could be used to power critical processes and make essential decisions across the business.

In much the same way, medical device manufacturers can consolidate their federated PLM and Quality Management Systems (QMS) on a unified platform. By doing so, they gain a single source of truth for product development, spanning multiple business units, languages and geographic locations.

Before the product is released to market, engineering data can be captured in what is known as a digital product definition enabling end-to-end traceability. The digital product definition includes everything related to the electronic, mechanical, and software aspects of a manufacturer’s products. Using this simplifies global product development and helps better manage data integration and product complexity, quality, and compliance.


Put a Solid Backbone in Place

As the industry shifts from “testing quality of products” to a more proactive strategy of “designing quality into products and processes,” the ability to control the total product lifecycle process has become a critical factor to ensuring product quality. An integrated PLM/QMS system spanning multiple acquired companies provides a solid foundation for achieving this goal.

With the right PLM/QMS in place as a backbone for controlled processes, medical device manufacturers can unify their operations and achieve hoped-for operational efficiencies. Those companies that can align merged and acquired business units in the shortest time will reap a competitive edge. It’s no wonder many leading companies are pursuing this vision through strategies known as One PLM and other similar programs.

More on the medical device industry here!

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  • Windchill
  • Digital Transformation
  • Life Sciences
  • PLM

About the Author

Robyn Gold

Robyn Gold, Director of Health Care Industry Marketing, delights in exploring the nexus of software, technology and marketing. She has more than twenty years’ experience helping technology companies bring new ideas to market. Prior to joining PTC in 2013, Robyn held diverse roles in IBM marketing, brand and product management for 14 years, where she launched the Rational Jazz platform and led a vertical marketing effort for regulated industries. Prior to that she ran her own marketing communications firm for five years, and developed new business opportunities in Amsterdam, the Netherlands, for ITT World Directories. Robyn holds a BA in economics from Brandeis University and an MBA from Northeastern University. She lives in Framingham, MA with her husband Brett. In her spare time Robyn enjoys cooking, travel, and electric guitar and is a member of her local music school’s adult band.