Swixit and Its Impact on the MedTech Industry

The recent political changes between the Switzerland and European Union (EU) have significantly impacted the Medtech industry. With more than 1400 Medtech companies, the medical devices sector accounts for 3% of Switzerland’s GDP and provides employment for > 63,000 workforce. Switzerland exports medical devices worth > $5.6bn and the medical device imports from the EU account for $3bn.

The Swiss Mutual Recognition Agreement (MRA) for medical devices has lapsed from May 26, 2021, and the negotiations between Switzerland and the EU have concluded without any concurrence on institutional agreement (InstA). Along with many other bilateral agreements, the Mutual Recognition Agreement (MRA) for medical devices has not been updated. Under the lapsed Mutual Recognition Agreement between the EU and Switzerland, the requirements for medical devices defined under Swiss Medical Device Ordinance (MedDO) were compliant with the EU MDD and EU AIMDD. This has enabled the medical devices to have indistinguishable access between the EU and Swiss markets.

The Swixit has an anticipated economic burden of 114 million Swiss francs ($127 million) for complying with initial administrative requirements and an annual burden of 75 million from subsequent years. This accounts for 2% and 1.4% of total export value to the EU, respectively.  Additionally, the Swixit would have a significant impact on the industry dynamics owing to -

• Loss of exports to the European Union
• Higher costs for compliance
• Loss of Switzerland’s market attractiveness
• High administrative costs make Swiss Medtech devices less competitive
• Swiss-based start-ups might opt for the EU countries to set up their HQs
• Non-EU MedTech companies might choose the EU countries for setting up their HQs

The MedDO has been revised and is in effect from August 1, 2020 and matches with the EU Medical Device Regulation (MDR). The EU-based medical device manufacturers shall comply with revised Medical Device Ordinance (MedDO). These companies shall appoint a Swiss Authorized Representative and the representative must have access to copy of technical documentation or should be able to submit the documents within seven (7) days from the day as requested by the Swiss Medic. The clause that the manufacturer would share such document to the representative shall be included in the contract made between both the parties.

The Swiss Medic has provided transitional timelines for various device categories for appointing Swiss Authorized Representative, including corresponding labeling.

Device Categories and Transitional Timelines