Jesús Donado, CEO of B. Braun Spain introduces the company’s strong footprint in Spain, as a manufacturing hub and a global centre of excellence for the company. Donado also discusses the challenge of offering solution and treatment-based services, while having to sell through product and volume-based tenders.
Can you introduce us to the footprint of B. Braun in Spain?
B. Braun is organised internally into four divisions. However, within the divisions, the organization is in term of centres of excellence – the competencies for a certain kind of technology. B. Braun in Spain is the Centre of Excellence for Closure Technologies products and is responsible for production, not only in the Spanish market but worldwide, for example in Colombia and India. The Centre of Excellence, based in Spain, is also responsible for R&D, Marketing, Quality Insurance, Regulatory, and Supply Chain for Closure Technologies products. That is the combination of organising the company both by divisions, and centres of excellence.
We are an extensive company in the Spanish market. B. Braun is both a medtech and a pharma company. I would distinguish two things about the footprint of B. Braun in Spain. In terms of market access, we are leading in market share within some of the highly specific areas locally. Moreover, we are one of the strong industrial sites within B. Braun’s global operations in terms of production capacity. In that sense, B. Braun’s local operational turnover is around EUR 540 million, 50 percent from exports.
How important is it to have a manufacturing footprint in Spain?
We are assisting in maintaining a high level of employment in the country. We have more than 2,700 employees in Spain. That is significant for the company because of our high industrial activity. The level of employment depends on our economic activity. Secondly, half of our revenues are reliant on exports, creating profitability, activity, and in the area of the Closure Technologies Centre of Excellence, we are responsible for R&D and have a huge team working in this area. Across these areas, we have a very good equilibrium of operations for the company in Spain, not only commercial, industrial, and R&D.
Tell us about B. Braun’s portfolio and how that is represented in Spain.
One of the main characteristics of B. Braun is the variety of products categories that we offer – up to 5,000 worldwide and 120,000 references. We try to deliver solutions for our customers, not only in products but in processes and therapies. That is one of the main strengths of B. Braun when compared with our competitors. This variety of products means that there is a variety of technology too; we produce and deliver 97 percent of our products. Almost all of the divisions and products are available in B. Braun Spain. We are not reliant on a strong performance from one individual division or product.
B. Braun does not differentiate its portfolio between any region or economy in the world. We do not customise our offering to a particular country or economic level of development. How companies usually divide countries stems from an economic point of view: underdeveloped and developed. At the end of the day, the patient, regardless of their location, has the same needs. Our ambition is to provide our most innovative products to patients wherever they may be. While you have to customise to some degree, this should not be based on quality. From an ethical point of view, the most innovative products must be available everywhere. We deal with developing economies in Latin America, such as El Salvador, where you will find the same product portfolio present in Germany.
While even in Spain, we have some areas that are better reached than others, but we strive to ensure that we can offer the same value equally across Spain, leaving no-one behind.
B. Braun’s ambition is to be a provider of holistic solutions. How well can you achieve this in the Spanish market?
That is our main concern regarding the characteristics of the Spanish market. The first issue is fragmentation. The second issue, given that 75-80 percent of the health system belongs to the public sector, is the tender process, which is product based. We want to go through a solution-based process. Thus, the system partnership does not always match with the regulations because we are tendering in single products.
Rather than aiming to deliver single products in isolation to our customers, we try and help to improve the clinical processes of the customers. In the end, we want to create a dialogue in terms of therapies and bring solutions instead of products. We have 18 therapies where B. Braun can offer such solutions through a combination of medical devices and pharmaceutical products.
The definition of a product as a medical device or pharmaceutical is a legal matter. From an operational point of view, clinicians use a combination of drugs and medtech to provide therapies and to treat patients. We want to conduct the dialogue between us and our partners in the same way, having the concept of the therapies. That is the corporate strategy. We need to talk in processes and sell in products.
How easy is it to bring innovation into the Spanish market?
There is no doubt that the economic crisis has exerted an impact on the medtech market in Spain, especially given the size of the public sector. In the past two years, we have seen a recovery, not only economically, but in terms of investment into the health system. Our expectation is that we will be able to continuously invest in the needs of the health system.
However, while investment has improved from its position five years ago, we still remain below investment levels of comparable European countries, so there is still a distance to go. With a more prominent budget for healthcare in the Spanish system, there will be more innovative products available and being introduced in Spain.
What are the next key goals that you would like to achieve in the coming 3-5 years?
The challenge that we have is to modify how to keep the new concepts of technology in our operational activity. We are currently the most important factory in B. Braun worldwide in the production of sutures. We are expanding our facilities and moving to a 30,000 square metre facility with a new factory. The challenge is not simply to expand our production but to develop new technology. We must go through full automation in the production of our products, in this case of sutures. As a Centre of Excellence, we must keep this in mind, continuing to provide not only quality products but also economically efficient products in terms of cost. This will be achieved by utilising the new technologies at our disposal.