The growing complexity of embedded and cyber-physical systems makes the design of all system components from scratch increasingly impractical. Consequently, already from early stages of a design flow, designers rely on prior experience, which comes in the form of legacy code or third-party intellectual property (IP) blocks. Current approaches partly address the co-simulation problem for specific scenarios in an ad hoc style. This work suggests a general method for co-simulation of heterogeneous IPs with a system modeling and simulation framework. The external IPs can be integrated as high-level models running in an external simulator or as software- and hardware-in-the-loop simulation with minimal effort. Examples of co-simulation scenarios for wrapping models with different semantics are presented together with their practical usage in two case studies. The presented method is also used to formulate a refinement-by-replacement workflow for IP-based system design.