Medical Device Manufacturing in the US Industry Market Research Report from IBISWorld has Been Updated

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Medical device manufacturers will continue to benefit from the aging US population, while the influx of newly insured people due to the healthcare reform bill will drive up demand for industry products. For these reasons, industry research firm IBISWorld has updated a report on the Medical Device Manufacturing industry in its growing industry report collection.

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Changing regulations for medical devices will inhibit growth, but revenue will remain stable

During the five years to 2012, the Medical Device Manufacturing industry fared relatively well, with revenue expected to grow at an average annual rate of 1.2% to $34.9 billion. The aging population is a major factor driving demand, as the occurrence of health issues that require medical devices is higher in the elderly population. Nonetheless, despite the indispensable nature of medical device products, the recession took a toll on a number of companies. “As some hospitals struggled to raise capital for large assets, thus delaying the purchase of medical equipment, industry revenue plunged in 2009,” says IBISWorld industry analyst Anna Son. “However, the improving economy, the aging population and technological advances have bolstered demand for medical devices in the following years.” IBISWorld estimates that revenue grew 2.3% revenue in 2012.

The Medical Device Manufacturing industry has a medium level of industry concentration. Small operators are common in this type of industry, and typically specialize in developing technology and products for a niche area. “Larger operators, such as major players Medtronic Inc. and General Electric Company, frequently seek to acquire these firms to expand their product offerings or gain access to a particular technology,” adds Son. As a result of consolidation, concentration within the Medical Device Manufacturing industry has increased over the past five years. During the five years to 2012, consolidation has swept the industry. As a result of consolidation, concentration within the Medical Device Manufacturing industry has increased over the past five years.

In the next five years, industry growth is forecast to continue. While the aging baby boomer population and technological advances will further underpin industry growth, a changing regulatory environment will be the main hindrance. For example, the Patient Protection and Affordable Care Act of 2010 has placed an excise tax of 2.3% on the sale of medical devices starting January 1, 2013. As a result, industry profit is expected to contract through 2017. Many companies are already preparing for the effects of the new tax by reducing jobs, slashing research and development budgets and delaying expansion plans. Also, potential reform of the approval process for new devices will likely hamper innovation and encourage more companies to shift some operations overseas.

Foreign outsourcing of manufacturing, research and development and other operations, combined with industry consolidation, is forecast to decrease the number of industry operators. This decline represents continued consolidation from the past five years. Emerging markets like China and Brazil will attract medical device manufacturers as US customers face more stringent Medicare reimbursement requirements and other cost-cutting pressures. Demand for medical devices is forecast to grow in these emerging markets due to their improving economies, rapidly increasing and aging population and the prevalence of chronic disease. For more information, visit IBISWorld’s Medical Device Manufacturing in the US industry report page.

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IBISWorld industry Report Key Topics

This industry includes manufacturers of electromedical and electrotherapeutic apparatus, such as magnetic resonance imaging equipment, medical ultrasound equipment, pacemakers, hearing aids, electrocardiographs and electromedical endoscopic equipment. The industry also manufactures irradiation apparatus and tubes for applications such as medical diagnostic, medical therapeutic, industrial, research and scientific evaluation.

Industry Performance
Executive Summary
Key External Drivers
Current Performance
Industry Outlook
Industry Life Cycle
Products & Markets
Supply Chain
Products & Services
Major Markets
Globalization & Trade
Business Locations
Competitive Landscape
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
Major Companies
Operating Conditions
Capital Intensity
Key Statistics
Industry Data
Annual Change
Key Ratios

About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit or call 1-800-330-3772.

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