Read the Conversation
Meeting highlights:
- Rebranding with Purpose and Legacy: The transition to Heraeus Medevio reflects a new identity, from being grounded in centuries of expertise in material science to being a medical device outsourcing partner.
- Global Footprint and Growth Trajectory: From a few employees in Hanau, Germany, to a global CDMO leader, the company continues to expand in Costa Rica and the Czech Republic.
- Culture of Innovation and Continuous Improvement: Heraeus Medevio fosters a culture of innovation and learning, celebrating employee contributions through internal recognition programs like the Medevio Awards.
- Long-Term Vision and Stability: As a family-owned company, Heraeus Medevio makes purposeful, long-term decisions that prioritize impact over short-term gains.
EF: Heraeus has a rich business history dating back to 1660. Could you elaborate on the company's footprint, role within the industry, and the reasons behind the recent rebranding?
HS: We are a Tier 1 end-to-end CDMO provider for our OEM customers. We supply them with components, assemblies, and finished devices according to their needs. We have approximately 2,500 employees across nine locations, including seven operational factories and two development centers. After experiencing double-digit growth in recent years, we expect to continue this trend. Historically, we were known for our work with precious metals under the name Heraeus Medical Components. However, as we've evolved, our company name no longer reflects our broader capabilities. We have expanded beyond manufacturing components only to include assemblies and finished devices, such as guidewires, implant delivery systems, catheters, and neuromodulation leads. Since we design, assemble, and manufacture a range of devices for our customers, the term "components" no longer accurately represents our work. As a result, we rebranded to Heraeus Medevio. This new name embodies our expanded products and aligns with our vision.
EF: You have invested significantly in Costa Rica and the Czech Republic. What are the key factors driving these investments, and how do they align with your global strategy to achieve your vision of improving one hundred million lives every year?
HS: We aim to produce what our customers need and maintain a strong manufacturing presence in close proximity to our customers. We decided to leverage manufacturing in "best cost countries", establishing production sites in Costa Rica in Latin America and the Czech Republic in Europe. Both facilities serve as an extended workbench for medical devices, allowing us to offer our OEM customers the best possible cost. We intentionally prioritize quality and require a robust engineering backbone for our products and customers. Costa Rica has become a hub for medical device companies, which benefits from its proximity to the United States market.
Costa Rica is currently our third-largest site, but is poised to become our largest manufacturing site. We are utilizing the factory for products that require a higher labor input, as there is a substantial cost advantage between the US and Costa Rica. As we produce complex products, we also need strong engineering support and education, which positions Costa Rica uniquely in this regard.
EF: What strategic trends do you foresee in Medtech and its supply chain?
HS: Outsourcing is becoming a significant trend among medical device executives. The percentage of outsourcing is outperforming the growth of the end-market. We must offer end-to-end solutions to meet customer demands, ranging from components and fully assembled, packaged, and sterilized devices, but also from design to manufacturing. Medical device OEMs excel in innovation and marketing, while Contract Development and Manufacturing Organizations (CDMOs) can support by supplying the necessary components, assemblies, and devices.
EF: As a Tier 1 CDMO provider, how do you remain a preferred partner?
HS: We collaborate with all medical device OEMs and focus our strategy on key market segments, particularly cardiovascular, neurological, and neuromodulation areas. Within these markets, we strive to address our customers' needs. To become the partner of choice, a few important factors must be considered: maintaining high quality and competitive pricing. These are essential criteria that a company must meet to be considered competitive in the market. Moreover, we must focus on innovation and incorporate new technologies to help our customers develop more effective and cost-competitive devices. It's important to identify our customers' needs regarding technology that they wish to outsource, and we aim to provide those technologies as part of our outsourcing services. Our customers seek end-to-end suppliers who can assist with the entire development cycle, transfer to commercial manufacturing, and ramp up production and scale effectively. The more comprehensive our coverage of the value chain, the better positioned we will be to secure customer programs. This capability sets Heraeus Medevio apart, as we provide complete end-to-end solutions.
EF: What excites you the most about your recent partnership with CorTec?
HS: CorTec has been active in the neuromodulation field for the past decade and possesses unique technological capabilities that we aim to leverage. These capabilities complement our existing offerings and will help us expand our product portfolio in the neuromodulation space. We currently provide percutaneous leads and plan to introduce cuff electrodes for other therapeutic areas within the neuromodulation market. This expansion will allow us to reach new markets and enhance our neuromodulation business.
EF: You lead 2,500 people across nine different sites; for a company where innovation and quality are priorities, how do you foster a culture of curiosity and continuous improvement within your team?
HS: Quality is our highest priority. We deliver high-quality products daily and ensure on-time delivery, all backed by strong metrics as proof that we strive to consistently perform well. We reinforce our quality culture by ensuring our team understands the impact of their work on people's lives. Our vision, "Improve a hundred million lives," is important. We engage with patients who have benefited from the products we support, whether through components, assemblies, or finished devices, and share their stories with our teams. This connection helps each team member relate to the products they are creating and underscores the significance of quality. When a family member or friend receives a device we've made, our role suddenly becomes personal. Understanding that the device could be implanted in a loved one drives our commitment to providing the best options.
We celebrate our quality vision on an annual Quality Day, reinforcing our dedication to excellence in everything we do.
In terms of innovation, we have established various teams around the world that focus on different aspects. Our organization includes technology scouting resources and a technology development team that operates independently from customer projects to explore new technologies. We celebrate our culture of innovation through the Heraeus Medevio Award, which recognizes new ideas and technologies created and developed within Heraeus. Our definition of innovation encompasses not only technological advancements but also business innovations. Lastly, fostering a culture of curiosity is an important aspect of leadership. As the company's leader, I recognize that there is much I do not know, which is why I ask questions. I encourage my team to do the same. This approach can help cultivate an environment where humility and curiosity thrive, with everyone constantly seeking to learn and grow.
EF: You have worked for the company for more than 20 years. Why have you chosen to stay instead of exploring other opportunities? What proud moments would you like to celebrate from the past two decades of leadership?
HS: The Heraeus Group is one of the leading family-owned companies in Germany. Our strong financial backing and commitment to long-term success set us apart from others in our market. While we always strive to deliver results, we refuse to make short-sighted decisions to achieve a good quarterly outcome, as can happen in publicly traded companies. This organization inspires me because it prioritizes the company's and our customers´ best interests over immediate results. There is a strong willingness to invest for the long term, and throughout my time here, there is a wide variety of products that I am proud to have contributed to as they evolved. When I joined Heraeus, the predecessor unit of what is now Heraeus Medevio had about 30 employees, so the growth trajectory has been tremendous. We have expanded organically and through acquisitions to become what we are today. I feel a strong connection to the company and the products we create. Having the support of the Heraeus Corporation, a family-owned global powerhouse, and being part of a mission that improves lives, makes me love my job. I couldn't be happier in any other job or position.
