Interview – Adavium targets Brazil and beyond


When thinking about developing markets China often hogs the limelight. But there are other economies out there with untapped potential for medtech companies, and Brazil must be near the top of that list.

“People don’t quite appreciate how big the Brazilian healthcare market is – it’s the third-largest market after the US and China [for private healthcare],” Fred Aslan, chief executive of Adavium Medical, tells EP Vantage. The company has seemingly come out of nowhere to claim to be the biggest medtech group in this country – and has ambitions in other emerging markets.

“We kept a low profile until we could disclose all of our acquisitions,” says Mr Aslan. Founded in 2011 and previously known as Advance Medical, Adavium has purchased four Brazilian companies so far: Imunotech Systems Diagnostics in 2013, Industra Technologies last year, and the diagnostics specialists Hemogram and Alka Tecnologia in April.

The long tail

Adavium is taking an interesting approach: on the one hand it acts as a distributor for device and diagnostic companies outside Brazil, including Abbott, China’s Mindray Medical International and the aesthetic device specialist Zeltiq. These premium imported products “have the latest bells and whistles”, and Adavium sells them to early adopters.

The other half of its business concerns its own products, which target the so-called “long tail” segment in Brazil. “These customers cannot afford to buy the latest and greatest,” Mr Aslan explains. “They need high-quality products, but at a more affordable price in order to cater to the vast majority of the population that have limited coverage and lower purchasing power.”

The company’s in-house devices, which it gained via its aforementioned acquisitions, include the Etherea dermatology and aesthetics platform and Sculptor CO2 laser, used for skin resurfacing, as well as various diagnostics.

“For us to be able to achieve our goal of navigating the Brazilian landscape and having the largest number of customers, we realised that it would make sense to have a dual approach of bringing products from abroad, as well as acquiring local companies that had done really well in the segment,” says Mr Aslan.

More acquisitions are on the cards, he adds: “We’re always evaluating these opportunities. I’m pretty sure we have more acquisitions in our near future.” These could involve both national and regional players to address the “very fragmented” Brazilian market.

Where next?

These two distinct sectors – the premium and value markets – make Brazil very different from developed countries, but similar to other developing nations. “This long tail segment exists in every single emerging market, and this is the segment that I always say is neglected by world R&D,” Mr Aslan says.

Adavium hopes to fill this niche and become the R&D company for the long tail market – not just in Brazil but in other emerging economies. The chief executive listed “China, India and other Asian countries” as areas it is interested in.

In all of its eventual markets, the company aims to maintain its “mixed and balanced portfolio”, selling both its lower-cost proprietary products and its distributed portfolio.

In the meantime, Adavium is focused on conquering Brazil, which Mr Aslan says is “an incredibly difficult place to do business”, partly owing to “all the red tape and bureaucracy”.

Here the company is helped by the chief executive’s background: he was born and raised in Brazil but educated in the US, and has had a career at a Silicon Valley venture capital firm as well as co-founding Receptos Pharmaceuticals, which was acquired by Celgene last year.

The privately held Adavium is well funded for now – it recently carried out a $21m series C financing and brings in sales of around $50m per year, according to Mr Aslan, although he does not say if it is profitable.

One hurdle facing the company is the current recession in Brazil, which could have a knock-on effect on healthcare, particularly the private sector. But Mr Aslan is optimistic that there is still plenty of room for expansion.

Like many nations, the country is grappling with an ageing population, which should “ensure that growth is pretty robust”. He concludes: “You can’t fight the demographic wave that’s coming.”

To contact the writer of this story email Madeleine Armstrong in London at or follow  @medtech_ma on Twitter

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