Analysing the co-evolution of embedded regulatory capabilities in firms and the state: the case of South Africa’s medical device sector

Regulatory authorities in developing economies not only face challenges regarding their own capabilities, but also have to grapple with heterogeneous levels of technological and innovation capabilities in firms. This paper draws from a firm-level analysis of internally created knowledge, externally sourced knowledge and firm heterogeneity among medical device manufacturers in South Africa to consider the corresponding evolution, development and deployment of regulatory capabilities in firms in their efforts to comply with the country’s health and allied products regulatory authority requirements. From this consideration, the paper explores possible broader adjustments in the country’s medical device sectoral system of innovation which would promote, nurture and embed the desired regulatory capabilities in firms to enable medical device firms to be locally and globally competitive and to contribute optimally to the country’s health sector objectives.