Report Predicts Top Ten Medical Device Trends to Watch in 2017
Posted January 12, 2017
2017 looks to be another challenging year for medical device manufacturers as they face mergers, the results of the 2016 U.S. presidential election, and other significant changes in the business landscape.
A report by Kalorama Information, a division of MarketResearch.com, has forecasted the most significant trends in the medical device industry through 2020. The top 10, according to The Global Market for Medical Devices, are:
- The incoming Donald Trump administration is expected to give a “sympathetic hearing” to medical device companies who would like to see a reduction in the user fees collected by the Food and Drug Administration (FDA).
- Trump is also expected to push for a repeal of the Affordable Care Act (ACA) and the associated medical device tax. Ensuring that people who gained health insurance under ACA will be important, so they will continue to have access to “the latest innovations.”
- The greater than $390 billion medical device market will grow in 2017, but the rate of growth will be modest over the next five years at 2.8%. The medical device user base will grow, but cost cutting will be an issue.
- Large-scale mergers and acquisitions will continue in 2017.
- Hospital consolidation will continue to drive spending toward top companies selling innovative products. However, the Federal Trade Commission may step in to slow the consolidation trend.
- Medical device prices will rise slower than other areas of healthcare due to group purchasing organizations, buying committees, and legislation.
- Research will continue to be a priority. Medical device companies spend an average of 7% of their revenue on research and development, with many increasing their spending as a percentage of revenue.
- The United States will dominate medical device revenues in 2017, in part because of challenges in reimbursement and reduced growth in Europe. The Chinese and Southeast Asian markets will grow much faster than the worldwide market as a whole.
- Cybersecurity threats will become more of an issue due to the increasing connectivity of medical devices.
- Wearable device revenues will outpace the rest of the medical device market. The global value for wearable medical devices was more than $13.2 billion in 2016.