Three decades of continuous investment by most of the world’s major medical technology companies have helped to make Ireland Europe’s leading location for medical device manufacture. This in turn has stimulated the emergence of an indigenous cluster of innovation-led, venture capital funded technology companies that are winning leading positions in international markets.
The principal product categories covered within Ireland include interventional products; diagnostics; medical equipment; dental, vision and hearing products; orthopaedics; disposables; and support products and services.
The earliest overseas firms established manufacturing operations in Ireland in the early 1970s. During the 1980s and the 1990s, foreign direct investment continued apace, while existing facilities expanded and took on additional functions in areas such as research and development (R&D) and sales and marketing. A comprehensive supply chain developed, comprising both indigenous and multinational companies.
This has increased in sophistication and complexity over the past decade, as suppliers have become more closely involved in the product development efforts of their customers. Their range of activities includes the provision of sterilisation services, tool making, injection moulding, contract manufacturing, sub-assembly and print and packaging. Management buyout activity has also started to take place within the supply chain, so that an increasing proportion of it is now held by Irish investors. The sector as a whole is now characterised by a strong set of linkages between multinational and local players.
Many of the leading multinational operations in Ireland gained high levels of autonomy during the 1990s, as they took on worldwide responsibility for certain products or product categories. This has stimulated the development of a cadre of industry executives with significant levels of international commercial and technical experience. In turn, this has helped to facilitate the emergence of a cluster of Irish owned medical technology firms, some of which have taken leading positions in their particular markets.
From the mid-1990s emerging clusters started to develop in particular in Galway, a major multinational manufacturing hub, and in Dublin, which has a sizeable local venture capital scene that is strongly oriented to innovation-led companies. Several Irish medical device start-ups have also attracted funding from international venture capital funds.
Indigenous product firms have focussed primarily on high-value areas such as medical equipment, diagnostics and interventional products. Firms have achieved particular product successes in areas such as catheterisation and stenting, minimally invasive surgical procedures and ventilation and respiratory care equipment.
A number have already achieved exits or have forged strategic relationships with international partners. Carotid stenting was pioneered in Ireland - the company involved is now a division of a major multinational company, following a successful trade sale.
The next wave of innovation will be supported by a comprehensive government investment programme in R&D, which has earmarked life sciences as one of its priorities. A dedicated €19.6 million research centre for biomedical engineering has been established at the National University of Ireland, Galway, as part of this effort. Ireland already has a strong position on the medical devices value chain, but it now appears to be on the brink of a virtuous cycle of investment and innovation. Most of the necessary ingredients are now in place.