Medical Tech in Germany

Industry Overview

The medical technology (medtech) sector is a market which is growing dynamically worldwide. An aging population combined with the need for new and innovative medical technology sustain the sector’s strength and constant growth, despite the current economic situation. Today, Germany is Europe’s leading location for medical technology and 3rd biggest medical technology producer and medical services provider worldwide. In terms of new patent registrations German manufacturers rank second behind teh USA, making Germany Europe’s strongest location for innovation in this industry.

The broad spectrum of technologies available in this area ranges from electrical engineering/electronics to precision mechanics and optics. Furthermore, technologies from the textile industry, the plastics processing, pharmaceutical and, most recently, from the biotechnology industries are also utilized in German medical products.

Industry in Numbers

  • Total industry turnover of EUR 18.3 billion in 2009
  • Around 9% of the total turnover was reinvested in R&D
  • In 2010 exports increased by 6% in the EU member states, 19% in rest of Europe, almost 13% in North America, more than 26% in Asia and over 28% in Middle and South America
  • With 87,000 employees the number of workers remained constant; 15% of all employees in this industry work in R&D
  • The industry is characterized by small and medium-sized enterprises. 95% of all companies employ less than 500 people.

Market Potential

Germany is the largest market for medical devices in Europe and the third-largest in the world. Nowadays, the medtech industry is considered to have the highest growth potential. According to a recent survey from the Medical Technology Association, (BVMed), 46 percent of the surveyed medtech companies expect a rise in revenues in 2010. In comparison to last year, businesses in the field are being more careful about their expectations, but have confidence in the sector’s stability.

Market Access

Foreign exporters must be aware that, in order to place medical devices on the market for the first time, the products must be registered with the appropriate competent authorities. In general, the manufacturer or authorized representative is responsible for the introduction of new medical devices on the market. The medical device’s importer is responsible in cases where the manufacturer’s location is outside the European Union and an authorized representative in the EU has not been designated. The Federal Institute for Drugs and Medical Devices (BfArM) offers detailed information on the EU directives on medical devices as well as guidance in accessing the German medical device market and the prerequisites to be fulfilled. Furthermore, a list of notified bodies can be found on the German Institute of Medical Documentation and Information’s website (DIMDI). This site offers access to about 60 databases with approximately 100 million documents.

Manufacturers and importers of medical products must also make sure that their products comply with the REACH regulations (Registration, Evaluation and Authorization of Chemicals). According to REACH, companies are required to prepare information on the chemical substances used in their products and register the data with the European Chemicals Agency (ECHA). Registration is required for most hazardous substances above 1 ton per year, for substances toxic to the aquatic environment above 100 tons per year, or substances manufactured or imported above 1.000 tons per year. For many medical products compliance with REACH is a prerequisite for affixing the CE marking.

All medical devices intended for the German market must bear a CE marking before they can be sold or installed. The CE marking is a mandatory conformity mark attached to certain products intended for sale within the European Union which indicates conformity with the essential health and safety requirements set out in the applicable European directives. Depending on the type of product, conformity can be assessed either by the manufacturer himself or by an authorized office.

Distribution Channels

Foreign manufacturers of medical devices tend to enter the German market by setting up subsidiaries. It is also possible to enter the market by contracting with a specialized importer in the medical device field or by participating in the tender procedures of hospitals or clinics. Another way of finding business partners in Germany is by participating in specialized trade fairs. The Association of the German Trade Fair Industry, (AUMA), offers a search engine on its website where interested companies can find trade fairs in their business sector.

Institutions in the German medical devices industry can be of great help in finding ways of effectively introducing products to the market.  The German Medical Technology Association, (BVMed), for example, represents about 230 manufacturers and service providers of medical devices. As a trade association, BVMed promotes and represents the combined interests of the medical technology industry and trade companies. Users can download several documents, e.g. the BVMed Annual Report which expands on the medtech market in Germany.

The Trade Association Medical Technology, (SPECTARIS), represents the interests of around 400 mostly small and medium-sized companies in the medical technology goods and appliances sector. The Trade Association Medical Technology provides its members support with and information on different industry-related areas and topics.

The German Association of Biomedical Engineering, (DGBMT), works to promote the development and application of innovative medical technologies. In the DGBMT, Physicians, scientists and engineers combine their efforts to facilitate the use of advanced technologies for diagnostics and therapy. The DGBMT organizes initiatives, projects and events to support promising activities like micro- and nanotechnologies in medicine and life sciences.

Hospimed publishes information databases on manufacturers and suppliers in the German health service sector in print, on CD-ROM and online.

Eucomed is the voice of the medical technology industry in Europe. The alliance represents around 22,500 European designers, manufacturers and suppliers of medical technology used in the diagnosis, prevention, treatment and amelioration of disease and disability. Small and medium-sized companies account for more than 80% of the businesses in this sector. Eucomed is active in market data collection, research and innovation projects as well as in international trade issues.

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German Food and Beverage Business

Industry Overview

Germany’s 82 million inhabitants make the food and beverage market the largest in Europe. The sector ranks fifth among the local industries and has a workforce of over 544,000 in the 5,900 predominantly small and medium sized enterprises.
Germany’s main trading partners in the food and beverage industry are other EU countries followed by Russia, the United States and Switzerland. Even though part of the local demand is satisfied with domestically produced goods, the country is a net importer in major groups of food and drink products. In the past ten years, food imports have steadily increased, thus underlying the rising demand for foreign as well as exotic foods.

Industry in Numbers

  • Second largest food producer in Europe with a total turnover of around EUR 150 billion in 2010
  • Exports amounted to EUR 51.8 billion in 2010 making up 34.5% of total sales
  • Imports of processed foods and agricultural commodities to the value of EUR 60.7 billion in 2010, making Germany a net importer of food & beverage products.
  • Largest sector sub-segments in 2009: meat (22.7%), dairy (15.4%), alcoholic beverages (8.7%), and confectionery food (9.4%)
  • Industry analysts forecast growth of 2.5% in 2011, with growing demand for convenience, health and wellness food products.

Market Potential

Given the large size of the German market, the existing opportunities in the food and beverage sector are very attractive to exporters worldwide. Especially the increasing demand for wellness, convenience food and organic products in the past years, represents a large potential for foreign companies active in these market segments.

German consumers are generally well informed. They expect high quality and low prices for their food and beverage products. The domestic food and beverage sector has profited from the fast economic recovery in Germany and the growing demand for food products made in Germany brought the export quota to an all-time high. Moderate growth was recorded in the meat and sausage products, confectionery, baked goods, and non-alcoholic beverage segments. The German food service market is also expected to grow significantly in 2011.

Market Access

The German food & beverage industry is highly fragmented and competitive. Food imports from other countries within the European Union fall under the “free movement of goods” principle. This means that products that are imported by other EU-countries may be brought into Germany even if they violate German food laws. If this is the case, importers must obtain a permit from the Federal Office for Consumer Protection and Food Safety (BVL) in order to sell the product in Germany. The duties to be paid for food brought from outside the European Union are subject to European legislation as well. The tariffs for different food products are published in TARIC, the Online Customs Tariff Database.

FOOD SAFETY – The legal framework on food safety was established by the European Union. The European Food Safety Authority plays a key role in the risk assessment of food. Many developments of the previous years were aimed to increase transparency and consumer confidence, by providing better information on food ingredients. Traceability of food products is also of utmost importance. For example, the country of origin must always be listed on food labels and all intermediaries (suppliers, distributors, etc.) that joined the food chain must be included as well. Companies trading food of animal origin from one country of the European Union to another need a special permit that is issued by the Federal Agency for Agriculture and Food (BLE).

NOVEL FOODS – Novel food imports in Germany must undergo a safety assessment before being brought into circulation. Importers of novel foods must apply for a license to sell these products at the Federal Office for Consumer Protection and Food Safety (BVL). As the responsible federal authority, the BVL will perform the necessary testing and send the results to the European Commission and the Member States for final approval. Detailed guidelines for the import of novel foods can be found at the Federal Institute for Risk Assessment (BfR).

PRODUCT PACKAGING – Exporting companies should be aware that product packaging is very important to German consumers since they are highly environmentally conscious. Manufacturers, importers, distributors and retailers must make sure that their packaging materials for their food products comply with the EU’s and Germany’s domestic regulations in terms of recycling and disposal. There are several dual system companies licensed in Germany offering various waste disposal schemes. Foreign exporters are free to choose which dual system they join. It is not mandatory to display any dual system membership seal on sales packaging.

Distribution Channels

Few German retailers import products directly from other countries. Most food retailers rather buy from central buyers/distributors specialized in the import of food & beverages. In general, these wholesalers have specialized in products or product groups; some are even experts in food products from a specific country of origin. These specialized importers have in-depth knowledge of all importing requirements such as the necessary product certificates, labeling and packaging and also take care of the shipping, customs clearance, warehousing and distribution of the products within the country. It is advisable that foreign exporters find a local representation in order to place and promote their products successfully within Germany.

The German retail food sector is dominated by five large retailers that claim more than 74 percent of the market. In 2010, the overall market share of discounters offering a limited selection of mainly private label goods at low prices remained stable at 41.6 percent. As mentioned above, all these retailers rely on specialized distributors/wholesalers for their products. However, some supermarkets will sometimes contract directly with a foreign supplier and appoint an importing company of their choice to bring the products into Germany accordingly.

Especially for foreign food and beverages companies, another useful way of finding the right distribution for their products is to participate in the various food trade fairs taking place in Germany. Trade shows like ANUGA, the Green Week or BioFach in Germany enjoy an exceptional reputation among industry experts worldwide. Participating in any of these events facilitates the direct contact with German food brokers, importers and wholesalers.

Supporting Institutions

Foreign companies looking for German food importers, wholesalers or distributors can find further information at the Federation of German Food and Drink Industries (BVE), theFederal Association of the German Retail Grocery Trade (BVL) as well as at the different food market segments industry associations.

The BVE represents the interests of 21 branch associations and 49 food and beverage companies in Germany. It is one of the first stops for foreign companies looking for information and contacts in the German food and drink industry. The BVE’s main responsibility is to represent the interests of its members at both national and international levels. The BVL serves as the federal organization for the food retail trade in Germany and represents all sales channels and companies in the field. The association’s role is to safeguard the sector’s interests with regard to legislation, the public authorities and the general public in Germany and Europe.

Information about the different industry-related trade fairs being held in Germany can be found in the database of the Association of the German Trade Fair Industry (AUMA).