Case Study: GA Generic Assays GmbH: a German SME

GA Generic Assays GmbH – from DE

Founded in 2002, GA Generic Assays GmbH is a privately owned company manufacturing and distributing diagnostic test kits focusing on autoimmune diseases.

SME Activities: Manufacturing and distributing diagnostic test kits focusing on autoimmune diseases.
Size: 17 employees, with a turnover of €2.4 million.
Interests in Japan: Distribution in Japan and cooperation in the development of new products.

Generic Assays’ aim is to provide high quality diagnostic tools to meet the ever-growing demand for affordable tests. Located in Dahlewitz, close to the German capital Berlin, GA collaborates with clinical research departments situated in universities all around Germany. In Germany, products are marketed by GA’s own sales force, while in other countries, its products are marketed through competent national distributors. The product range, which focuses on innovative autoimmune diagnostics, is constantly expanding and there are ambitious future plans for the development of new parameters and new technologies for the diagnostic market.

WHY JAPAN?

Generic Assays has a strong interest in establishing itself on the Japanese market. More specifically, it is aiming to establish a distribution network in Japan, and to find pharmaceutical companies in the field of gastroenterology to cooperate in the development of new products.

STEPS TAKEN – 2013 EU-Japan Cluster Support Mission

Before participating in the 2013 EU Cluster Support Mission, organized by the EU-Japan Centre for Industrial Cooperation, GA had unsuccessfully tried several times to enter the Japanese market through consulting companies. During the 2013 mission, however, it established relations with 3 Japanese companies. The company gained insights into the peculiarities of Japanese business culture, and into key regulatory affairs connected to making medical products available in Japan. This greatly helped in developing the right strategy to enter the Japanese market.

“The lectures were very helpful, because they gave us a good overview of the Japanese way of thinking and doing business.”

-          Dirk Roggenbuck, Managing Director, Generic Assays.

During the 2013 mission, GA also had a great opportunity to visit Olympus’ headquarters in Japan. This was possible due to GA’s sister company Medipan’s long-standing business relationship with Olympus. This was an ideal opportunity to talk about future business and to visit the production facilities. Since GA uses Olympus parts in microscopic devices, it was helpful to see the way these devices are manufactured, how logistics are handled, and what kind of production capacity exists. This helped GA understand how relations with Olympus could aid in future plans for the development of devices for the diagnostics market. The companies subsequently agreed for a rolling forecast to ensure the continuous delivery of required products.

During the mission organised by the EU-Japan Centre, GA participated in the BioJapan 2013 Business Forum, where it established several contacts with other companies from the Southeast-Asian region, such as Thailand and Vietnam. This turned out a great opportunity, since GA has already managed to accomplish its first sales in these markets as of August 2014!

With Japanese companies the whole process takes a little longer of course, but nevertheless GA keeps communicating with its contacts, slowly building up the relationship.

CHALLENGES

The language barrier remains an underestimated problem. You can understand this when you contact a Japanese partner by phone or email, and after a while notice the different understandings of the English language.

“It is like the movie “Lost in Translation”: you think you are talking about one thing and after 10 mails, you realize that your partner on the Japanese side understood something completely different.”

-          Dirk Roggenbuck

Dirk Roggenbuck believes that you need to know your partner before doing business. The best way to do this is of course through face-to-face contact, which can be organised through Skype for example, but to organise this with Japanese people is very difficult. So his experience is that there is no other way than to meet them personally, even though this can be costly for smaller SMEs.

Another aspect that makes the Japanese market really difficult, is that they have a completely different philosophy and view towards business. So if you have difficulties with a country and their understanding of business, you need to go there and learn it.  Moreover, Mr Roggenbuck’s view is that the Japanese market is not an entirely free market. In order to get a share in this market, it is necessary to get agreements from different stakeholders active in the market segment that you wish to enter. Another point is that the Japanese market is highly regulated. In terms of diagnostics for instance, it takes almost two years to get a registration for a product. This means that you have huge costs in terms of investment for entering this market. And this is something that needs to be discussed with your partner.

CURRENT STATUS – NEXT STEPS

Generic Assays currently has contacts with 3 Japanese companies, one of them in the field of licensing. This company provides GA with information about new patents that are available on the market. GA is also negotiating with 2 companies in the diagnostics field.  The company is preparing to go to Japan a second time to meet its Japanese contacts again and to strengthen its relationships with them. Furthermore, GA has products that are now being considered for registration, and will be launching the process shortly. However, GA has been at this stage before, and patience remains an important virtue.

Interview made with Dirk Roggenbuck