In October of last year, Medtronic made headlines when it reported that it was going to acquire Changzhou holdings, a China-based company that is a provider of orthopedic devices, for $816 million.
Now the acquisition, in my opinion was perhaps the loudest shot fired in the battle to maintain a dominant presence in China one of the fastest growing emerging markets.
Last month, Stryker responded in kind with its plan to acquire Trauson Holdings, a China-based firm that specializes in products for the spine for $764 million.
After listening to a webinar from Millinneum Research Group, about the Top 10 trends to watch out for in med-tech, the shift in focus to emerging economies came in at number two on the list. But the interesting thing is, the topic of acquisitions into China was also a part of the seventh trend to watch out for, which was Merger & Acquisition Activity Increasing.
In a sense one could argue that the topic was big enough to take up nearly two slots on the trend list. But what this really signifies is that the shift in thinking for firms is starting to become action.
Companies are eager to dip into new markets and in 2013 and I think we're going to see an explosion of firms investing in emerging markets, especially China.
The rules, however, are going to change, and it's not going to be business as usual when vying for regulatory approval. There are going to be cultural differences, and a different approach on securing clearance for a product to get to market.
It's going to be a far different ride, but this presents a new frontier for med-tech companies to explore.