U.S. Export Opportunities in France’s Healthcare Market

An expert addresses the opportunities for U.S. healthcare exporters in France and the trends shaping the country's healthcare market.

Curt Cultice

France, the world’s sixth largest economy with nearly 65 million people, has an aging population that is fueling demand for new healthcare technologies. While U.S. companies currently account for one-third of all medical device imports into France, there continue to be growth opportunities for U.S. healthcare suppliers. 

AVACEN, a San Diego, CA manufacturer of an over-the-counter class II medical device that provides non-invasive temporary arthritis and muscle pain relief, was searching for a comprehensive export strategy for Europe beyond its initial web sales. The company sought collaborative assistance from the San Diego Regional Economic Development Corporation and U.S. Commercial Service (CS) in San Diego. CS export counseling provided AVACEN with a roadmap for honing its European export strategy—namely, information on key CS resources, and how to complete export documentation requirements and evaluate potential overseas partners. The firm also received market briefings and local overseas contacts from the CS in France and Germany. Ramping up its European strategy, AVACEN has added French and Spanish language capabilities to its AVACEN 100 device and related literature.

“Like many small companies, we don’t have all the internal resources to export on our own,” said AVACEN CEO  Thomas G. Muehlbauer. “The export assistance clarified our needs, and put us on the right path to exporting. We’ve seen solid sales growth in France, one of our top European markets due to its aging population and robust healthcare spending. The country’s central location also gives us greater access and ability to increase our European-wide sales.”

In the below Q&A, Alain Levy, commercial specialist at the U.S. Embassy in Paris, discusses the latest trends in France’s healthcare market. His office is part of the U.S. Commercial Service of the Department of Commerce’s International Trade Administration and its worldwide export assistance network.

Why should U.S. healthcare exporters consider France a good market opportunity?

Levy: France has the fourth largest population and second largest economy in Europe. The country has a state-of-the-art healthcare network and is widely regarded as a world leader in medical practices. France is home to leading surgeons, clinics, hospitals, and research universities, all of whom are interested in buying the most innovative devices and pharmaceuticals available, including U.S. technologies. In 2015, the French market for medical devices alone was estimated at $21.2 billion.

France spends approximately 11% of its gross national income on healthcare. Healthcare in France is universal, meaning that all residents are eligible to receive government-funded care. To care for these patients, France has a network of 1400 hospitals, of which 65% are publicly owned and 35% are privately owned. The large healthcare market, combined with the fact that a relatively large portion of the market comes from imports, makes France an excellent place for U.S. exporters. In addition, U.S. companies often use France as a hub for selling throughout the European Union (EU).

Alain Levy

What is the outlook for growth in U.S. medical equipment to France?

Levy: Market demand in France for medical equipment was estimated at $7.5 billion in 2016, with total imports accounting for $3.9 billion. Imports from the United States were estimated at $1.3 billion, or 33% of total imports. This percentage is expected to remain steady over the next three years, with overall demand growing at 3% annually.

What are some of the demographics and trends that are driving the market demand?

Levy: Like many developed nations, France has an aging population with an ever-increasing need for medical care. Excellent medical care has significantly increased life expectancy; about a third of France’s population is over 55. As that population continues to age, it will grow the market for aging-related healthcare services like memory care and assisted living.

The French government has implemented controls on health expenditures as a key objective. How is this affecting demand for various technologies?

Levy: France is committed to continued innovation in its healthcare system, both for the purpose of improving care standards and reducing inefficiencies. The concept of value-based healthcare is taking hold, with products that can decrease costs in the healthcare system in high demand. However, medical device suppliers can sometimes find it difficult to promote their products, even in the case where they provide an obvious saving. For example, if a given device that costs $8000 can reduce the time that a patient spends in the hospital, saving $40,000, it will result in a net savings of $32,000. Unfortunately, France’s system does not allow for a holistic cost-benefit analysis in terms of patient care, as procurement decisions for hospitals and medical devices are managed separately. To address this issue, companies need to conduct outreach at the national and regional level, making the case for the innovativeness and efficacy of their products.

What types of opportunities exist for U.S. healthcare equipment?

The best sales prospects for medical equipment include newly developing areas such as noninvasive surgery, orthopedics, and disposable medical equipment. Healthcare professionals are highly optimistic about new technologies such as telemedicine, which already have a major impact on medical care institutions. Recent advancements in medical procedures and techniques in France, such as same-day outpatient surgery, should benefit American medical product manufacturers selling innovative medical devices for treatment. This includes products and services aiming at reducing healthcare costs. Devices in specialized sectors, such as diagnosis, rehabilitation, surgery, technical aids, intensive care, and hygiene are also in high demand.

Are there major planned infrastructure projects of note that U.S. firms can leverage?

Levy: The French market is currently focused on modernizing existing hospitals rather than constructing new ones. Devices that can automate tasks or reduce costs will be in demand during these modernization projects. In fact, the number of hospital beds in France has been decreasing over time. Despite the decrease in beds, the increasing need for products related to medical home care and long-stay hospitalization for an increasingly older population will bring new prospects for U.S. suppliers.

France has developed the Carte Vitale, a single electronic card that allows patients to process reimbursements electronically. What is the status?

Currently, the Carte Vitale is only for reimbursement, and doesn’t yet have any medical records attached to the account. There is still talk about implementing the electronic records portion of the Carte Vitale. Electronic medical records lead to improved communication between hospital staff and general practitioners. Any company that has experience with digitizing medical records could be of value in the French market. The French Association of IT Health Professionals (CATEL) has organized group visits of IT buyers and suppliers to trade shows held in the United States by the American Telemedicine Association (ATA) and the Healthcare Information and Management Systems Society (HIMSS).

What are some challenges for U.S. exporters in France’s healthcare sector?

Levy: In order for a U.S. company to be an effective exporter, it must have a French distributor that can handle the logistics of equipment registration and reimbursement. In France, distributors are very specialized and typically only sell products in a particular niche. For that reason, it can sometimes be difficult to find a French distributor that would match well with a U.S. company’s products. The U.S. Commercial Service in France can help American companies find an appropriate French counterpart to be their representative. Also, be aware that U.S. firms face stiff competition from German manufacturers, which are known for producing high-quality technical instruments.

What should U.S. exporters know about medical device registration as it pertains to France and the European Union?

Levy: All medical devices must carry the CE (Conformité Européenne—European Conformity) marking before they can be sold in the EU. A CE marking permits sale in all EU countries. When it comes to selling products and registering as a manufacturer or importer in France, all written material, including the product label, instruction manual, and the application for reimbursement, must be translated into French. This is another reason why it is so crucial to find a French distributor. Most distributors should already be familiar in dealing with the French Ministry of Health, and U.S. companies should make sure their distributor can properly handle the reimbursement process.

What’s can the U.S. Commercial Service do for companies that want to get started or expand into the French market?

Levy: The U.S. Commercial Service of the U.S. Department of Commerce’s International Trade Administration helps U.S. companies export. Our office in France is part of a global network of 108 offices across the United States and in U.S. embassies and consulates in more than 75 countries. Businesses are encouraged to take advantage of our many services. We can assist with export counseling, market intelligence, business matchmaking, participation in trade events, commercial diplomacy, and other customized services.

To get started, visit export.gov, the U.S. federal government’s export assistance portal. On the site you can:

Curt Cultice is the senior communications specialist for the U.S. Commercial Service.

[Image courtesy of WALKERSSK/PIXABAY.COM; Headshot courtesy of ALAIN LEVY]     

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