My feet certainly know that they’ve spent four days pounding the aisles at Medica. The question is: what did I learn?

The startling thing about Medica is that, despite the abundance of suppliers, there is a notable absence of many big names. Abbott, Roche and Beckman Coulter - market leaders in supplying top-end diagnostic equipment - were not present. Nor were Varian and Elekta, the world leaders in radiotherapy. The event is very much an international gathering, but the net is set quite wide and very far: distributors and dealers in attendance were more often from Eastern Europe, Africa and Asia than from Western Europe.

There was, however, a plethora of tiny companies, many offering “me-too” products. Indeed, there is nothing like a walk around Medica to make you realise just how inefficient the medtech supply chain must be.

We think that this is set to change. As we point out elsewhere, the ridiculous price differences that so often exist between one European country and another are eroding as more Pan-European providers emerge in sectors such as imaging, lab outsourcing, hospital management and residential care. 

Another obvious trend is the way procurement has been removed from doctors and nurses and placed in the hands of the CFO and his purchasing team. One supplier said: "Ten years ago, medical experts made 90% of the decisions and the purchasing team around 10%. Today, those numbers have reversed." That is an exaggeration, but even high-end suppliers say that they are constantly being pressed to present the business case for their products these days, whether they are selling to the private sector or the public. 

This should encourage the development of broader-based distributors who can make the business case for a wide range of products to purchasing teams in non-technical ways. 

In England the NHS has already moved in this direction. Here, DHL pays the government a licence fee to run the NHS Supply Chain, which accounts for around 65% of the items purchased by the English NHS. DHL is ruthlessly driving down prices. Consumable suppliers with no IP tell us that they are being confronted by 10% annual price cuts and sudden extensions of payment terms from 30 to 60 days. These reductions are already a fait accompli before the suppliers have even had a chance to negotiate.  

At the same time, many manufacturers are moving deeper into the homecare space. Coloplast, for instance, intends to bring its US model to Europe.  This means that patients who need ostomy bags will be called when they leave hospital and offered advice and help - possibly even home visits. 

We think that private healthcare providers, whatever services they supply, are well-placed to demand much lower prices in this environment. It also highlights the opportunities that exist for the growth Pan-European, broadline medtech distributors such as GADA and Onemed.