45 Medical Device Industry Statistics, Trends & Analysis

The medical device industry in the United States is expected to reach $208 billion by the year 2023. The exports of these items exceeded $43 billion for the American economy in 2018. Sometimes referred to as the “medical technology industry,” items such as instruments, machines, apparatuses, and articles that help in the prevention, diagnosis, or treatment of disease or illness are all part of this segment.

The purpose of a medical device does not include the use of metabolic, immunological, or pharmacological interventions. These products work to correct, restore, or modify the function or structure of the body in some way.

Almost 2 million jobs (direct and indirect) are present in the U.S. economy because of the medical device industry. Over 80% of the active companies in this space have fewer than 50 employees, and most of them have little or no sales revenues to report.

Companies responsible for medical device manufacturing in the United States are highly regarded for innovative, high-technology solutions. That’s why investments in research in this area have more than doubled in recent years, with investment rates doubling the average for American manufacturing.

Important Medical Device Industry Statistics

#1. The United States is the largest medical device market in the world today. The value of this single segment was approximately $155 billion in 2017. Americans represent approximately 43% of the worldwide market for this industry. (SelectUSA)

#2. When evaluating the entire diagnostic industry supply chain (which includes medical devices), the total value to the global economy is more than $300 billion. (DSV)

#3. The average American spends about $400 on each medical device they use, making the U.S. market the most expensive one in the world today. (Inbound Logistics)

#4. Regulatory inspections in the medical device industry are increasing at a 300% rate. (Supply Chain Drive)

#5. 70% of the world’s largest original equipment manufacturers, measured by revenue, have their headquarters in the United States. Some of them are only divisions of a larger company, such as General Electric Healthcare or Johnson and Johnson Medical Devices and Diagnostics. (Inbound Logistics)

#6. 39% of senior executives in the medical device industry consider their supply chain technology systems to be a critical component to the enhancement of their current operations. (Logimed)

#7. 43% of senior executives report that digitization of the supply chain is an essential component of their organization’s future success. That’s the same percentage who also believes that big data is a critical part of the supply chain. (Logimed)

#8. 75% of the medical device industry believes that having a better supply chain ability is a concern for the market. (AT Kearney)

#9. The in-full, on-time delivery performance for medical device manufacturers stands at just 93%. (AT Kearney)

#10. Companies in the medical device industry spend approximately 7% of their annual revenue on research and development projects, reflecting the competitive nature of this space. (SelectUSA)

#11. Supply chain costs account for 40% of the expenses found in the medical devices market today. Improving the performance in this one area could boost profits for manufacturers by up to 20%. (McKinsey)

#12. Up to $5 billion in expenses each year managed by the medical device industry involve adverse quality costs. (IQS)

#13. Only five manufacturers in this industry control 90% of the market for artificial knee and hip implants. The total sales for implantable devices are more than $70 billion per year. (AARP)

#14. The value of surgical and medical instrument manufacturing shipments in the United States totaled $38.4 billion in 2018. (Statista)

#15. The top company in the United States in 2017 in the medical technology industry was Johnson and Johnson, earning almost $27 billion through this division. (Statista)

#16. The strongest companies within the Medtech industry involve orthopedics, cardiology, IVD, and diagnostic imaging. IVD brings the industry about $53 billion annually, with Roche the leading global manufacturer. The Swiss firm brought in over $10 billion in revenue in this one segment in 2017, taking 19.5% of the market. (Statista)

#17. Zimmer Biomet is the leading provider of global hip and knee implants for the medical technology industry. Their share of the market in 2018 was 33%. (Statista)

#18. The leading provider of products for the advanced wound management segment of the market in 2018 was Smith and Nephew at 14%. (Statista)

#19. Venture capital investments in the medical device industry in 2018 totaled $8.5 billion in the United States. Over $1.1 billion of this was in the information technology sector. (Statista)

#20. Size matters for agencies that operate in the medical device industry. The largest companies are consistently profitable and operate with margins that fall into the 20% to 30% range. (MedPac)

#21. Hospitals spent about $14 billion on implantable devices and $10 million in medical supplies that were covered by Medicare in the United States. (MedPac)

#22. The medical device industry has about 5,500 active companies operating in this sector, providing direct employment figures of up to 365,000 each year. (BMI Research)

#23. Up to 40% of domestic American production is ultimately exported each year in the Medtech sector, but that figure also represents the number of foreign sales that occur in the United States each year. (Seligman)

#24. The largest export markets for U.S. medical device companies is usually Japan and the European Union, sometimes representing up to half of the revenues earned for the year. (International Trade Administration)

#25. 73% of the companies currently active in the medical device industry have fewer than 20 employees. 88% of them have less than 100 employees. About 20% of total employment comes from these agencies. (International Trade Administration)

#26. Only two companies outside of the United States consistently break into the list of the 10 largest medical device firms in the world each year: Siemens Healthcare in Germany and Philips Healthcare in the Netherlands. (Medical Product Outsourcing)

#27. 83% of the companies who were active in the Medtech industry in the past year had less than $1 million in total assets. 95% of them have less than $10 million in assets. (MedPac)

#28. The top 1% of firms that are active in the medical device industry are responsible for 82% of this segment’s assets. 56% of the assets come from the top 0.2% of agencies. (MedPac)

#29. The 17 companies with more than $2.5 billion in assets in this space claimed 56% of the tax credits for research, development, and experimentation. Firms with over $500 million in assets claimed 80% of these credits. (MedPac)

#30. Most medical devices manufactured by the industry get replaced by a new version within 18 to 24 months in most circumstances. That means a successful product is not typically as profitable as a blockbuster-level prescription drug. (Advanced Medical Technology Association)

#31. Doctors were responsible for about 1 out of every 5 patents granted to the medical device industry between 1990 to 1996. The U.S. Patent and Trademark Office has issued over 75,000 patents in this space since the 1980s. (Seligman)

#32. The Food and Drug Administration reviews about 4,000 510(k) submissions each year. Most of the products receive clearance in 90 to 180 days. (Seligman)

#33. Over 60% of the medical devices that entered the market between 2003-2007 were exempt from any FDA review, whereas 31% went through the 510(k) process. Only 1% went through a premarket approval process to reach the market. (MedPac)

#34. The cost of submitting for a premarket approval can be up to ten times higher than the expense of submitting a 510(k) notification in the United States for new medical devices. (MedPac)

#35. The FDA can order product recalls for devices found to pose a health risk. During FY 2016, the agency issued this order for almost 2,900 products. About 4% of these orders involved a serious risk to patients. (FDA)

#36. Total healthcare spending in the United States totals more than $3 trillion per year. That means the average expenditure on needs in this area is over $9,400 per person annually. (Emergo)

#37. Only 52% of the spending that occurs in the American healthcare market comes from private payments. The remainder comes from government resources. (Emergo)

#38. The United States has one of the lowest rates of hospital beds per capita in the world today. Americans have only 2.9 beds per 1,000 people, whereas Japan has 13.7 per 1,000 people. Even China, where the average spending on healthcare expenditures is only $420 per person, has a higher rate at 3.8 beds per 1,000 people. (Emergo)

#39. Despite the high rate of growth found in the medical device industry, 12 of the 20 largest companies in this space experienced negative growth at least one year in the past five. (Evaluate)

#40. Electro-medical equipment represents 17% of the industry, accounting for a variety of powered devices like MRI machines, ultrasonic scanning devices, and pacemakers. (International Trade Administration)

#41. 29% of the Medtech market involves surgical and medical instruments, including optical diagnostics, blood transfusion devices, and hypodermic needles. (International Trade Administration)

#42. Irradiation apparatus items that include X-ray devices and CT equipment represent about 8% of the medical device industry sales each year. (International Trade Administration)

#43. The average job in the American medical device industry manufacturing sector pays about 15% more than the median found in other sectors. The average wage in 2012 was over $60,000 per year. (International Trade Administration)

#44. The United States serves as a home to 141 accredited medical schools and about 400 teaching hospitals and health systems, many of which consistently rank as some of the best in the world. (International Trade Administration)

#45. Although the mature export markets for American manufacturers are quite lucrative and large, Japan, Canada, and the European Union have relatively low annual growth rates of 3% to 5% in most years. That’s why the industry is looking to build resources in the developing world. (International Trade Administration)

Medical Device Industry Trends and Analysis

The medical device industry is forecast to grow by up to 12% annually over the next five-year period. This outcome is certainly achievable is manufacturers can continue to add efficiencies to their supply chain while reducing adverse quality outcomes. Growing demand for products outside of the United States will encourage additional growth.

If this industry wants to see success, then it must continue to invest in research and development projects while reducing problems in the manufacturing process. 28% of the companies in this space experience at least one recall order each year due to shipping issues. When the quality control issues combine with that statistic, those who see the most success in the future may look to areas like implantable devices to limit losses.

Regulatory convergence is another trend to watch. Representatives from several nations have met consistency since 2011 to address the establishment and operation of voluntary regulators to create harmonization around the world. Efforts are in place to reduce or eliminate tariffs in critical markets while having government payments provide higher reimbursement rates.

The future looks bright for the medical device industry as Baby Boomers reach new plateaus in their aging needs. If refinement to the supply chain can happen, then the profits should be massive.