{"id":812,"date":"2019-10-08T09:56:13","date_gmt":"2019-10-08T13:56:13","guid":{"rendered":"https:\/\/blogs.sw.siemens.com\/siemens-opcenter\/?p=812"},"modified":"2026-03-26T04:58:41","modified_gmt":"2026-03-26T08:58:41","slug":"overcoming-medtech-challenge-4-market-consolidation-and-technology-partnerships","status":"publish","type":"post","link":"https:\/\/blogs.sw.siemens.com\/opcenter\/overcoming-medtech-challenge-4-market-consolidation-and-technology-partnerships\/","title":{"rendered":"Overcoming MedTech Challenge #4: Market Consolidation and Technology Partnerships"},"content":{"rendered":"\n<p><em>Fourth in a series of seven blogs focused on the top\nchallenges that medtech manufacturers face today, and the technologies and\nimplementation strategies that are critical to meeting these challenges.<\/em><\/p>\n\n\n\n<p>Large medical device companies\u2019 drive for scale and strength\nin their chosen core business areas compels them to pursue merger and acquisition\n(M&amp;A) strategies as well as technology partnerships to achieve dominance. In\nan environment of accelerating consolidation and partnerships, how can MD&amp;D\nmanufacturers consolidate disparate systems and leverage technology to support\nimproved communication and cooperation?<\/p>\n\n\n\n<p>Here are a few key insights related to these trends:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>The industry has evolved over the last several\ndecades from a fast-growing market to a maturing one, driven by a slowdown in\nproduction volume. As a result, the industry is experiencing accelerating\nconsolidation<\/li><li>Abbott Laboratories acquired St. Jude Medical\nfor $25B. The acquisition is an important part of the company\u2019s ongoing effort\nto develop a strong, diverse portfolio of devices, diagnostics and\npharmaceuticals for cardiovascular diseases, Frost &amp; Sullivan reports<\/li><li>Johnson &amp; Johnson (J&amp;J) acquired\nAbbott\u2019s eye surgery business for $4.33B. The deal allows Abbott to focus on\nits core business and divest from noncore business. It also allows J&amp;J to\nexpand its portfolio and become a larger presence in vision care<\/li><li>Frost &amp; Sullivan has found that almost half\nof CEOs (45.8 percent) believe they will rely on partnerships to drive their\norganization\u2019s growth over the next three years<\/li><\/ul>\n\n\n\n<p>The strategic advantages of consolidation and partnerships\ncannot be gained without taking on some new challenges that affect a company\u2019s\ndigital technologies:<\/p>\n\n\n\n<p><strong>M&amp;A leads to a multitude of disparate systems. <\/strong>As\nM&amp;A activity brings together manufacturing environments from previously\nseparate companies, disparate systems and point solutions will need to be\nconsolidated to achieve visibility and control quality and cost.<\/p>\n\n\n\n<p><strong>M&amp;A may lead to culture clashes and miscommunication.\n<\/strong>Bringing together organizations will require extensive communications not\nonly to coordinate innovation, compliance and quality, but also to overcome\ncultural differences. Manufacturers will not only need to manage organizations,\nbut also leverage technology to support a common digital footprint and foster\ncommunication and cooperation.<\/p>\n\n\n\n<p><strong>Companies must manage any increase in technology\npartnerships. <\/strong>The rise of high tech in MD&amp;D is driving manufacturers to\nnew competitive areas where they may not have all the capabilities and\nknowledge in house.Manufacturers will need to establish strategic\npartnerships with high tech manufacturers to augment their skills and enable\nthem to deliver new devices to market.<\/p>\n\n\n\n<p>To address these challenges, manufacturers will rely heavily on <a href=\"https:\/\/www.plm.automation.siemens.com\/global\/en\/our-story\/glossary\/manufacturing-execution-systems-mes\/38072\" target=\"_blank\" rel=\"noopener\">Manufacturing Execution Systems (MES) <\/a>to unify disparate manufacturing operations for both newly acquired companies and technology partners. MES must include the following capabilities to meet the new demands:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>MES systems must be built for global\nmanufacturing operations, collaboration, visibility, control and analytics\nacross the global operations, partner ecosystem and supply network<\/li><li>MES systems must be enterprise-ready, enabled to\nexercise control across global manufacturing footprints, with complete\nend-to-end traceability and 5M enforcement (manpower, machine, materials,\nmethods and measures)<\/li><li>MES systems must support data aggregation across\ncloud-based IoT applications for big data analytics \u2013 facilitating\nunderstanding of performance across dispersed operations<\/li><li>MES systems must support multi-plant\ncollaboration for efficient and scalable change management<\/li><\/ul>\n\n\n\n<p>To ensure their MES supports this type of global\nmanufacturing environment, manufacturers must meet several platform\nrequirements:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Multi-site capabilities that are easy to use\nout-of-the-box (OOTB)<\/li><li>Ability to customize the manufacturing process\nusing OOTB data modeling capabilities<\/li><li>Definition of standard operations, which will\naccelerate the ability to define a newly acquired company\u2019s operations<\/li><li>Ability to define centrally and customize\nlocally \u2013 the MES should allow for local requirements and preferences<\/li><li>Integration with scheduling solutions to\nidentify plants with available capacity or equipment to create efficiencies<\/li><\/ul>\n\n\n\n<p>A global MES connects the enterprise, gets information\nflowing across multiple sites and partners in a rapid, consistent fashion to\nincrease speed, agility and efficiency. The ability to lift-and-shift \u2013\nallowing the propagation of manufacturing processes and instructions from one\nfacility to another \u2013 creates rapid implementation at lower cost. Control over\nall global operations is imperative to produce consistent quality, ensure\nreliability and lower prices for end products, including complex devices.<\/p>\n\n\n\n<p>As consolidation continues, MES is critical to increase innovation velocity and scale operations across disparate manufacturing operations. <\/p>\n\n\n\n<p><a href=\"https:\/\/www.plm.automation.siemens.com\/global\/en\/topic\/medical-device-challenges-and-mes\/64263\" target=\"_blank\" rel=\"noopener\">Read the full white paper<\/a> to learn about more trends facing the Medical Device industry, and how <a href=\"https:\/\/www.plm.automation.siemens.com\/global\/en\/products\/manufacturing-operations-center\/camstar-medical-device-suite.html\" target=\"_blank\" rel=\"noopener\">integrated MES<\/a> is addressing new challenges. <\/p>\n","protected":false},"excerpt":{"rendered":"<p>Large medical device companies\u2019 drive for scale and strength in their chosen core business areas compels them to pursue merger and acquisition (M&amp;A) strategies as well as technology partnerships to achieve dominance.<\/p>\n","protected":false},"author":29942,"featured_media":804,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"spanish_translation":"","french_translation":"","german_translation":"","italian_translation":"","polish_translation":"","japanese_translation":"","chinese_translation":"","footnotes":""},"categories":[1],"tags":[288,287],"industry":[225],"product":[],"coauthors":[],"class_list":["post-812","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","tag-manufacturing-execution-system-mes","tag-manufacturing-operations-management-mom","industry-medical-devices-pharmaceuticals"],"featured_image_url":"https:\/\/blogs.sw.siemens.com\/wp-content\/uploads\/sites\/3\/2019\/10\/meddev-mes4.jpg","_links":{"self":[{"href":"https:\/\/blogs.sw.siemens.com\/opcenter\/wp-json\/wp\/v2\/posts\/812","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blogs.sw.siemens.com\/opcenter\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blogs.sw.siemens.com\/opcenter\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blogs.sw.siemens.com\/opcenter\/wp-json\/wp\/v2\/users\/29942"}],"replies":[{"embeddable":true,"href":"https:\/\/blogs.sw.siemens.com\/opcenter\/wp-json\/wp\/v2\/comments?post=812"}],"version-history":[{"count":2,"href":"https:\/\/blogs.sw.siemens.com\/opcenter\/wp-json\/wp\/v2\/posts\/812\/revisions"}],"predecessor-version":[{"id":816,"href":"https:\/\/blogs.sw.siemens.com\/opcenter\/wp-json\/wp\/v2\/posts\/812\/revisions\/816"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/blogs.sw.siemens.com\/opcenter\/wp-json\/wp\/v2\/media\/804"}],"wp:attachment":[{"href":"https:\/\/blogs.sw.siemens.com\/opcenter\/wp-json\/wp\/v2\/media?parent=812"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blogs.sw.siemens.com\/opcenter\/wp-json\/wp\/v2\/categories?post=812"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blogs.sw.siemens.com\/opcenter\/wp-json\/wp\/v2\/tags?post=812"},{"taxonomy":"industry","embeddable":true,"href":"https:\/\/blogs.sw.siemens.com\/opcenter\/wp-json\/wp\/v2\/industry?post=812"},{"taxonomy":"product","embeddable":true,"href":"https:\/\/blogs.sw.siemens.com\/opcenter\/wp-json\/wp\/v2\/product?post=812"},{"taxonomy":"author","embeddable":true,"href":"https:\/\/blogs.sw.siemens.com\/opcenter\/wp-json\/wp\/v2\/coauthors?post=812"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}