Growing Your Medical Device Business in High-Potential Markets: Asia-Pacific & Latin America

Industries Profiled:
Medical Device; Distribution; Pharmaceutical; Health Care; Technology; Diagnostic


Companies Profiled:
B.Braun; Boston Scientific; Cochlear; Fine Science Tools; Getinge; Hospira; Innovo Medical; Johnson & Johnson; Medtronic; MMJ Labs; Nonin; Ortho-Clinical Diagnostics; Philips Healthcare; Polymed; Precision Tool Technologies; Procursum Medical; Promaxo; Rossmax; Stable Orthopaedics; Terumo BCT

Study Snapshot

Best Practices, LLC engaged 23 commercial, marketing and sales leaders from 20 leading medical device companies in this research. While 19 leaders participated in the benchmarking survey, five of them also participated in deep-dive interviews. Four other leaders contributed their insights solely through deep-dive interviews.

Key topics covered in this report:

• Emerging markets: Opportunity size, growth targets, revenue & key markets served
• Operational insights: Structure, reporting, performance measurement & staffing growth areas
• APAC investment
• LATAM investment
• Critical success factors & future trends, self-pay vs. reimbursable markets

• Nearly 75% of companies use some form of decentralized EM commercial structure, based on geography or therapy area

  Few companies use a completely centralized emerging markets commercial structure. Instead, almost half of companies use a decentralized structure, organized most often by geography or in some cases by therapeutic area. Another 26% use a “hybrid” mix of centralized and decentralized commercial functions.

• China market garners highest share (23%) of APAC investment, while India receives a 19% allocation

  On average, the China market receives the highest investment allocation (23% of all APAC commercial spending), followed by India (19%) and South Korea (17%). Australia receives an average spend allocation of 11%, with Taiwan currently seeing 5%.

• The Class III medical device opportunity is sizeable across emerging markets – and growing rapidly
• Firms are active and well-established in many emerging markets
• Asia-Pacific accounts for much higher share of global revenue than Latin America
• Half of companies deem China their single “highest-priority” market
• Top-rated performance metrics include “total sales/growth” and “total units utilized by customer”
• In past 3 years, total EM commercial staffing has seen positive growth at every level (corporate, region and country)
• Top predicted corporate headcount growth areas: Market development (self-pay markets) and clinical support (reimbursable markets)
• While China commands highest total staffing allotments in APAC, Australia earns highest percentage of marketing staffing
• Companies heading toward greater use of direct sales approach in APAC over next 3 years
• Many use a “barbell” investment approach in LATAM: heavy allocations to corporate and country levels, but light regional ones
• Brazil and Mexico receive the bulk of LATAM investment
• Brazil enjoys higher marketing headcount levels than Mexico market
• Majority of device companies use a distributor sales model in LATAM – and will continue to do so

I.	Executive Summary: Methodology, Participants, Key Findings	pgs. 3-11
	Study structure & design
	Universe of learning: Benchmark class
	Key study findings
II.	The Emerging Markets Picture	pgs. 12-21
	Opportunity size
	Target growth rates
	Key markets served
	Regional revenue
	Highest-priority markets
	Measuring success
III.	Operational Insights	pgs. 22-30
	Structure
	Reporting
	Measuring success
	Implementing personnel (corporate, region, country levels)
	Staffing growth areas
IV.	APAC Investment & Operations	pgs. 31-40
	Corporate-region-country level spend distribution
	Spend allocations to specific markets
	Headcount allocations to specific markets
	Direct vs. distributor model
V.	LATAM Investment & Operations	pgs. 41-52
	Corporate-region-country level spend distribution
	Spend allocations to specific markets
	Headcount allocations to specific markets
	Direct vs. distributor model
VI.	Critical Success Factors	pgs. 52-59
	Top drivers of success
	Self-pay vs. reimbursable markets
VII.	Case Studies of Individual Emerging Markets	pgs. 60-70
	Success stories and competitive challenges in individual markets

• Highest priority markets for benchmark partners
• Percentage of benchmark companies active in Asia-Pacific and Latin America region
• Current and anticipated revenue from emerging markets
• Benchmark companies’ year-over-year revenue growth target for emerging markets in the next fiscal year
• Countries supported by benchmark partners in APAC and LATAM regions
• Percentage of total global revenue derived from each region
• China, Brazil and India – by the numbers and voices from the field

• Defining global commercial regions
• Global commercial structure for emerging markets
• Job level of the person responsible for participants’ emerging market business
• Predicted investment changes in corporate HQ headcount
• Single greatest corporate headcount growth area
• Effective metrics for measuring commercial success in high-potential markets
• Total commercial headcount to support emerging markets
• Marketing headcount to support emerging markets

• Percentage of total APAC global marketing spend allocated to each level of the organization
• Percentage of total spending for the entire Asia-Pacific region allocated to key countries in the past year
• Percentage of total spending for the entire Asia-Pacific region allocated to marketing activities only in key countries in the past year
• Sales model adopted in each of the listed countries in APAC region
• Future changes to APAC sales model
• Voices from the field – General Manager’s perspective on using a hybrid sales model
• Total headcount for all commercial operations in the Asia-Pacific region (including corporate, regional and country-level FTEs)
• Percentage of total headcount for all commercial operations for the Asia-Pacific region across the entire organization (including corporate, regional, and country-level offices) allocated to each of the listed countries in the past year
• Percentage of total headcount for all commercial operations in the Asia-Pacific region allocated to marketing activities only in each of the listed countries in the past year

• Percentage of total LATAM global marketing spend allocated to each level of the organization
• Voices from the field - Regional office spread across LATAM region
• Voices from the field - Regional offices must give you “access to talent” that can serve the region
• Percentage of total spending for the entire Latin America region allocated to key countries in the past year
• Percentage of total spending for the entire Latin America region allocated to marketing activities only in key countries in the past year
• Sales model adopted in each of the listed countries in the Latin America region
• Voices from the field – President’s perspective on trying the direct sales model in Brazil
• Future changes to LATAM sales model
• Total headcount for all commercial operations in the Latin America region (including corporate, regional and country-level FTEs)
• Percentage of total headcount for all commercial operations for the Latin America region across the entire organization (including corporate, regional, and country-level offices) allocated to each of the listed countries in the past year
• Percentage of total headcount for all commercial operations in the Latin America region allocated to marketing activities only in each of the listed countries in the past year

• Top success drivers in APAC and LATAM markets
• Voices from the field - Expectation of high level of clinical support make it a “must-have” in LATAM, rather than a competitive differentiator
• Influential functions in driving success in patient self-paying emerging markets
• Voices from the field - Succeeding in patient self-pay emerging markets
• Critical groups to drive reimbursable market effectiveness

• Voices from the field - Relationships are critical for success in China market
• Voices from the field - Major key to success in India is selectivity
• Voices from the field - Managing distributors is key to success in Brazil for a small company
• Additional success stories from Brazil
• Voices from the field - “Integrated Services” model in Mexico
• Voices from the field - Cash-pay market allows freer hand for customers in making product mix or volume purchasing decisions in Mexico
• Additional success stories from Asia-Pacific markets
• Voices from the field - High degree of KOL responsiveness to new therapies in Argentina
• Additional success stories - Top EMEA markets