Category — Editorial

There is no doubt that with the strengthening dollar, costs for homecare products are set to rise in Europe. Most manufacturers and distributors of wheelchairs and other homecare products extensively source wheelchairs or components from China, where products are usually procured in US Dollars.

A quick glance at a ten year chart will show that a 10% or more swing in a relatively short time is not outside of the realm of possibility. It is also interesting to note the close linking of the Yuan (despite the US wish that that it will be allowed to float more in the future).

Of course with the largest revenues derived from Government reimbursement business, increasing prices is not going to be that easy. So it seems that the industry may be in for another round of restructuring, standardizing on lower featured products, or perhaps worse.

There are of course better ways to run sourcing and supply chain operations that are mostly dependent on China, but in an industry largely driven by cost, many companies have largely ignored these options – maybe at their peril.

Here is Business Week’s take on the fluctuating exchange rates.

Dollar Rises for Sixth Week Versus Euro After Fed Rate Increase – BusinessWeek.

Frank Barlin is Managing Partner at Sibaya LifeScience!

Where does the balance between the profit motive and patient care meet? Where in the so called first world can you not go to a pharmacy and pick up the drugs you need with the minimal delay – and no, more deregulation is not the answer.

BBC News – Patients miss out on treatment as drugs sold abroad.

Drug wholesalers selling stock abroad to maximise profit means UK patients are missing out on essential medicines, experts say.

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Are hospitals who limit ties with drug companies at a competitive disadvantage? | KevinMD.com.

KevinMD asks an interesting question, and goes on to summarize:

In a lot of ways, this is similar to the college recruiting of athletes. Schools that have rigorous academic requirements put themselves at a competitive disadvantage athletically. The same could be said for hospitals, who risk driving away doctors by limiting their ties with drug companies.

My own take is simply “absolutely not”.

On the related posts several other drug company / physician ethics / commercial questions are raised.

• Invacare – Market Report — In Play (IVC): Briefing.com Business News – MSN Money – http://goo.gl/5BwO #
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• BBC News – Vegetative state patients can respond to questions – http://goo.gl/KnVD – (see functional MRI) #
• Medical schools not responding to ghostwriting scandals – http://goo.gl/VmXi – Really hard to believe. Inviting more unwelcome regulation. #
• NHS going private, USA going public? What next? Politicians need to rethink the role of the private sector in the NHS – http://goo.gl/G5qJ #
• Make sure to share this with your ad agency when next you are negotiating your annual terms – http://goo.gl/IHEu #

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Press Release:

Handicare takes the next step to success

2 February 2010 – Midlands based Stairlift manufacturer Minivator has signed a deal to become the latest member of the family of companies in the Norwegian based Handicare, subject to regulatory approval.

Previously owned by its Directors and Gresham PE, Minivator Group has had an exceptional growth record, indeed it continued to experience double digit growth throughout the testing economic climate of recent years. With a core product range of stairlifts Minivator has expanded its presence establishing operations in North America and Germany and have recently started its own manufacturing base in the Far East. It has seen expansion within the UK having taken on new premises at least four times in the last three years.

As one of the world’s leading manufacturers of stairlifts with a turnover of approx. 55 million Euro, and 420 employees selling to over 35 countries the Minivator Group was a desirable prospect for many companies. The board were in no rush to sell, choosing instead to spend time finding the perfect partner to move forward with. They found such a match with the Handicare Group. Minivator CEO Mike Lord commented “We were looking for a buyer who not only made sound business sense but who was also a great fit with the culture and values that Minivator holds at its core. We are delighted with the deal and are looking forward to seeing what the future holds. We believe exciting times are ahead and being part of a larger and well established group that holds similar ethical beliefs will open up many opportunities that will be mutually beneficial and rewarding.”

The healthcare company Handicare AS, owned by Herkules Private Equity Fund1, was founded in 1986 and has operations in technical aids like wheelchairs and home care products in addition to adaptation of cars for elderly and physically disabled people. Through its subsidiary Puls, the Group also has a leading position in Norway in the sales of capital goods and consumables to hospitals and institutions. Handicare has its headquarters in Moss, Norway, and has subsidiaries in Sweden, Denmark, Germany, the Netherlands, England, Belgium, Poland, USA and Canada, and distribute its own products to an additional 30 markets. Handicare has just shy of 1000 employees and reached sales over 250 million Euro in 2009.

Handicare CEO Per Gunnar Borhaug explained “Handicare has grown both organically and through the acquisition of successful companies that had the same drive as Handicare: the desire to provide excellent products and services that help improve the quality of life for the less able, the elderly and those who care for them. Having identified Minivator Group as a financially promising acquisition target we were delighted to find that they had the kind of culture that would fit right in with Handicare’s other companies.”

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For further information concerning this press release please contact:

Per Gunnar Borhaug, CEO Handicare, +47 69 24 44 28

Mike Lord, CEO Minivator, +44 (0) 1384 40 87 00

[1] Herkules Private Equity Fund 1 is an investment fund with Euro 250 million in capital from 25 Norwegian and international investors. Herkules Capital has in total 1,4 bill Euro under its administration. HPEF has a financial strength which enables them to take a dominant position of ownership in well-established companies with a potential for further growth. Herkules acquired Handicare in July 2005 and has during the latest three years tripled the size of Handicare and is aiming for further growth.

More about Handicare over time on this blog