HCB News: If you want to manufacture in the US how does a company decide on a state and city to go to?
ER: For medtech companies with manufacturing capabilities, availability of talent, infrastructure, logistics and taxes and incentives are important factors. Without a need for manufacturing capabilities, infrastructure is much less of a concern. Especially now, a growing concern for everyone is the availability of a local workforce. What type of people do you need and what are their skills? If needed can you work with local educational institutions to provide training? What are the local and state incentives companies can obtain when new jobs are created. We always recommend that companies look at several locations to get a sense of where the tax breaks will be most favorable and then weigh those benefits against all other factors.

HCB News: Rather than building from scratch, a significant number of foreign companies are seeking to acquire existing US companies. What are some of the major challenges and what do they need to consider?

ER: It takes time and it takes a lot of upfront effort to get that done. Targets could be enterprises with whom a company has done business in the past where they is familiarity, trust and a working relationship. Alternatively, there are advisors who can help identify targets in the United States. From there, it takes a lot of time to get to a letter of intent and to get to closing, especially in highly regulated industries, because there's a lot of licensing involved to make sure that all the proper compliance structures are in place. Another major challenge, which is often overlooked, is the thoughtful post-acquisition integration of systems and people so that the acquisition is actually additive to the business as a whole. Many acquisitions struggle or fail because this last piece is not given the proper attention.

HCB News: Who is responsible for the compliance piece? Does the counsel that you retain take care of the advisors and deal with everybody involved, or do you seek a compliance professional or you? What experts are involved in that?
ER: The diligence on compliance spans various practice areas and professions. Lawyers assess the strengths of the target’s compliance program, financial risks related to product liability and enforcement actions of the US Food and Drug Administration (FDA), intellectual property and other regulatory and contractual matters. We rely on technical consultants to assist with the review of the FDA’s technical requirements and on IT experts review whether a target is prepared against cybersecurity attacks, for example. The exact deal team will depend on the nature and type of deal.

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