Lessons for CEOs from the Consolidation of the Medical Device and Diagnostic Industries

Abstract

This work reports an examination of the recent wave of industry consolidation in the medical device and diagnostic market. It shows that excellent companies are clearly differentiated from their less effective rivals by the care and rigour with which they approach the task. In exemplar companies, mergers and acquisitions arise from profound strategic thinking. Partner or target selection is based on the strategic aims of the deal and integration is based on the synergy realisation objectives inherent in those aims. With this approach, merger and acquisition are beneficial, but have to relate simply to financial performance.