Are Those Synergies Real? Go-to-Market Due Diligence for Medical Products Companies

Pete Masloski, Brian Chapman

While mergers and acquisitions are the lifeblood of the medical device and diagnostics industries, too often, they fail to achieve expectations because of excessive buyer optimism.

This optimism can result from many factors, but is often because assumptions regarding commercial synergies or product adoption rates that appear reasonable on the surface are, in fact, unrealistic. The acquirer will end up paying too much, saddling the merged entity with expectations that are impossible to meet.

To avoid these situations, we have found that good go-to-market due diligence—understanding the customers’ buying process, the selling process required to drive adoption and the best post-deal sales model—helps screen out potentially bad deals, gives acquirers a more accurate assessment of value and provides a head start on integration. Go-to-market due diligence can be a powerful means to help medical device companies assess an acquistion’s true potential, and should be an integral part of any due diligence process.

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