Medical Devices Industry: Market Research Reports, Statistics and Analysis

As with most industries, the medical device sector was not untouched by the economic crisis, though it has not deterred the industry’s overall growth. Smaller firms, unable to pick up the slack of product development costs previously covered by venture capital investors - now made more cautious by the economic slump - were obliged to curb their activity. Some other small firms, however, chose to merge with larger firms, thereby continuing technological advances without bearing the full burden of the cost. Domestic and international acquisitions and mergers allow a cross-border sharing of resources and knowledge, facilitating continued medical technology innovation despite the tough economic climate.

More evident challenges to the medical device sector include taxes on products in overseas markets as well as incongruous foreign regulatory controls and varying implementation of standards.

Key Players & Regional Markets

Top names in the industry include such medical technology leaders as: Johnson & Johnson, who ranked 40th in the Fortune 500 list for 2011, Abbott Labs (ranked 69), Medtronic (ranked 158), Baxter (ranked 192), Boston Scientific, GE Healthcare Technologies, Becton Dickinson, St. Jude, Stryker Corporation and Beckman Coulter.

Regionally speaking, the US is the leading competitor, holding in excess of 40% of the world medical device market, reports Exvere private investment bank. The US is not only an important player in manufacturing and exporting medical device products but also creates about half of global market demand. It imports lower-technology medical device products, with a notable share coming from China, and tends to export higher-technology device products. While the US may see its stakes in the global market rise in the event of taxes being lowered, practices standardized and standards harmonized, it would also see more staunch foreign competition from countries that, even if they lag behind in innovation or expertise, could compete through the cheaper production of lower-technology medical devices.

Growing domestic production of lower-technology devices not just in China but also in India, Korea, Taiwan and Brazil will help those nations become relative competitors to the US in the future; though the US is set to remain at the top of the higher-technology device market for some time. In fact, the US market is forecast to climb to $140 billion in 2013, over double its worth of $60 billion just a decade earlier, as indicated by the preliminary results of a Washington State biomedical device study.

While demand for medical devices in developed regions such as Japan, Canada, the EU and the US remains steady with annual growth rates of between 3% and 5%, developing regions are to prove lucrative for US exports, with demand in countries such as India and China showing more than twice the rate of developed countries. China’s sizeable population and healthy economic growth make it an increasingly promising target market. India equally shows potential as an export market for the US medical device sector due to its ever-more affluent population and strong accompanying private healthcare system.

At the moment Germany, the Netherlands and Bermuda are key competitors to the US for market share in higher-technology medical devices. However, some companies, such as Dutch firm Philips Electronics, are not completely independent players in so far as a good deal of their production is carried out in the US.

Medical Device Product Life Cycle

To enter the marketplace, medical devices must comply with pre-defined product life cycle parameters intended to maximize patient safety and ensure the highest quality standards. The product life cycle can be divided into three main phases. The first phase, or early product life cycle, consists of a product concept with its relevant market strategy and financing. The second phase, or the middle product life cycle, involves manufacturing and validation through clinical trials along with packaging and labeling. Lastly, the late product life cycle phase consists of not only the market launch of the medical device but also market analysis that subsequently impacts on successive generations of the product.

Professional Certification

The Medical Device Body of Knowledge, created by the World Medical Device Organization, is an accrediting body that provides online multimedia medical device training. It offers three levels of qualification:  

1)    Certified Medical Device Associate (CMDA) – A basic level of knowledge that covers legislation, medical directives, assessment, classification, standards and the role of notified bodies.

2)    Certified Medical Device Professional (CMDP) – This intermediate accreditation teaches the latest standards as applicable in the product life cycle. This course offers training in diverse aspects of medical device knowledge, including project management, worldwide device regulatory systems, clinical investigation submission, and clinical project financing and reporting.

3)    Master Medical Device Professional (MMDP) – This qualification facilitates a more in-depth understanding of regulatory systems and strategies, and also involves training in ethics, reviewing clinical research, post-market assessment, traceability and product recall.

Regulatory Bodies

Australia, Japan, the US, Canada and the EU are the five founding members of the Global Harmonization Task Force (GHTF), a body that seeks to maintain regulatory control over medical devices in a cohesive manner across global markets. The organization has three broad phases of regulatory control for medical devices, which are divided into premarket, placing-on market and post-market frames. Though different regions differ in the specifics of regulatory control, the first two phases involve risk management, licensing and registration while the post-market surveillance phase includes recording distribution, recall procedures and processing complaints.

The GHTF aims to coordinate regulatory efforts, aid technological growth and encourage trade by producing documentation that provides coherent guidelines for its members. The documents are made by GHTF study groups and are split into four areas of expertise: comparison of worldwide medical device regulatory systems, post-market analysis, study of already operational quality system stipulations, and lastly a study group that puts forth principles by which to review medical devices.

The Medical Device Manufacturers Association, a Washington DC-based national trade association, seeks to streamline policy decisions related to the medical device sector through cooperation with the US Congress, the Food and Drug Administration (FDA) and US healthcare payer the Centers for Medicare and Medicaid (CMS).

The FDA Center for Devices and Radiological Health (US FDA/CDRH) is also involved in the regulatory control of medical device products. This body aims to record adverse events of medical devices on the market. One of its initiatives proposes the establishment of a database that would allow easy access to information on US FDA-approved medical devices.

Moving forward, one of the most important tasks for bodies of regulatory control is to set medical device standards applicable in all countries to harmonize and facilitate global trade and promote patient safety.

Market Outlook

The global medical device industry is likely to continue going from strength to strength, with the US keeping its top spot for the foreseeable future. The US remains a leader thanks to cutting edge technological innovation and demand from growing markets such as India and China. The industry as a whole is growing largely because of an ageing global population and climbing societal risk factors. In particular, diet-related chronic diseases, such as cardiovascular disease and diabetes, continue to create demand for medical healthcare services.

Equally, the need for medical devices continues to climb, with life expectancy jumping nearly 20 years over the past 50 years. In fact, worldwide demographics are increasingly shifting towards older populations: between 2000 and 2050, populations in developed regions will see those aged over 60 grow from less than 20% to 34%, while the proportion of children aged under 15 is set to decline by 2% from 18%. According to a United Nations report on ageing, by the 2050s, life expectancy at birth will reach 80 years for almost 60% of the global female population. This ageing population, combined with lifestyle-related disease, is the medical device industry’s assurance of increasing market demand.

Leading Industry Associations

• World Medical Device Organization http://www.wmdo.org/  
• Medical Device Manufacturers Association http://www.medicaldevices.org
• Global Harmonization Task Force for Medical Devices http://www.ghtf.org/
• UK Medicines and Healthcare Product Regulator http://www.mhra.gov.uk/index.htm
• US Food and Drug Administration - Medical Device Regulator http://www.fda.gov/MedicalDevices/default.htm