20 April 20, 2016
Qatar German Co. Med manufactures various medical devices and its headquarters is located in the Middle East. Their website states that they house a “state of the art production facility” and that they design, manufacture, and deliver quality and innovative medical devices. The company mentions that it partners with technology providers from Germany, Switzerland, and Italy in order to provide innovative products. The company anticipates a rapid growth in the market for medical devices as their demand is widespread worldwide.
Although the company projects rapid growth in the future for medical device manufacturing, the industry is still affected by external factors. Stein and Stone (2013) analyzed factors that affect commercial entities in different industries and countries. One common factor present in the study indicated that economic uncertainly makes it “difficult to identify a particular cause” due to the correlations between supply, demand, investment, firm behavior, etc. The authors of the study developed several strategic formulae to analyze currency and price volatility and its effect on the corresponding markets. Stock market prices were also taken into account as was the range of outcomes influencing capital investment, hiring, research and development, and advertising. The study indicated that during times of economic uncertainty, many companies funneled more funding towards their research and development departments. More research and development projects for companies began during this time than at any other economic swing.
International implications of industry trends indicate that while the United States consistently leads metrics for the strength of their medical device manufacturing industry, other countries are experiencing increasing rates of growth while the United States is experiencing a decrease in the overall growth in the industry. In an article posted in Medical Device Business, Holtzman, Gorkhover, and Ganz concluded that while the United States capitalized on its current strengths of market position and size, research and development investments, academic institutions, and strong finance markets, there are also opportunities to overcome such as “innovation plateau, the medical device tax, a tough regulatory environment, inferior government subsidies for research and development, and a lack of venture capital for startups.” Internationally, certain governments may be more relaxed regarding the rules and regulations governing this industry. With more coordination and collaboration with local and federal government, countries can expand their medical device manufacturing industry at a quicker rate.
With more collaboration from the government, the industry can presumable grow more quickly because many of the additional costs associated with taxes, fines, licenses, and patents may not be an issue. Since companies would not have to pay those costs, the products could possibly be manufactured at a lower cost and offered for sale for a lower price than if those additional fees were to be passed onto the consumer. Since Qatar German Co. Med is located in the Middle East, workforce labor is affordable due to the currency trades from international sales. The company would not have to change headquarters due to increased labor costs. That issue may present itself at a later time but international sales currency exchanges covers that cost and still yields enough profits to fund projects for the company.
References
Holtzman, Yair, Gorkhover, Gleb, and Ganz, Michael. "The U.S. Medical Device Industry."
Medical Device Business. 12 Jan. 2015. Web. 20 April 2016.
Stein, Luke CD, and Stone, Elizabeth. "The effect of uncertainty on investment, hiring, and
R&D: Causal evidence from equity options." Hiring, and R&D: Causal Evidence from
Equity Options (October 4, 2013) (2013).
