The Munich Region: A hidden champion with innovative capabilities
The Munich region is one of the leading centres in Germany for medical engineering. 350 companies in this industry give work to 19,000 socially insured employees and generate annual revenues of EUR 4.1 billion. On the whole this industry is stronger than you would expect and one of the prime drivers of innovation.
These were the findings of a comprehensive study of “Medical engineering in the Munich region”, commissioned in 2015 by Munich's Department of Labor and Economic Development.
Driving technological innovation
The Munich region boasts a broad spectrum of medical engineering companies whose offerings range from the production of hospital and laboratory equipment to complex high-tech devices. Digitization is transforming industries and is driving innovation in medical engineering in particular. Examples include information and data management for patients, laboratory samples and medical equipment.
As the study shows, Munich's medical engineering sector channels an exceptionally large proportion of its annual revenue – 15 percent – into research and development.
Some 350 companies in and around Munich belong to this industry. Of these, 200 manufacture medical engineering products, 115 provide related services and 35 are component suppliers. Small and medium-sized enterprises (SMEs) are the backbone of the sector: Around half of all the companies in this industry employ fewer than 20 people.
Out of a total of roughly 21,000 gainfully employed persons in the region's medical engineering sector, about 90 percent are in socially insured employment.
Startup activity in the industry is highly dynamic: Around a quarter of the medical engineering companies, suppliers and service providers that currently operate in the Munich region did not exist before the turn of the millennium.
The sector has a strong international focus: Approximately one third of the companies generate more than 75% of its turnover abroad. The largest target markets are the EU countries and the USA.
Cross-sector technologies and companies
Munich's medical engineering cluster ranks as one of the leading centres of competence in Germany, benefiting from important basic and cross-sector technologies also present: Mechatronics, microsystem technology, ICT, photonics/optics, materials science and the pharmaceutical and biotechnology sectors all help it realize a broad array of products and system solutions.
Munich's firms are young, flexible and mostly international. Global players include Baxter, General Electric/GE Health Care and LivaNova (formerly the Sorin Group).
The city's universities, academies and respected research organizations supply the industry with innovative potential and highly qualified specialists. Munich is also a strong healthcare hub with a high-quality medical and hospital infrastructure.
Trends and outlook
High-tech companies in the growing healthcare market
According to the study, industry players have very positive expectations for the next three years, looking forward to significant growth in both their own companies and the industry as a whole. The advance of digitization and associated downstream developments are seen as the most important technological trend. At the same time, companies are bracing themselves for fiercer competition from Asia while also anticipating strong growth stimulus from the same region.
Challenges include a possible lack of skilled and specialist labor, changes in medical product law and changes in national healthcare benefits.
Last updated: September 2018