Eyeing a global customer base hell-bent on perpetual belt-tightening, medical device manufacturers are launching new device lines, updating existing ones and investing more dollars in research and development—and the aggressive strategy is paying off.
Such is the word from Kalorama Information. The market research publishing house released a study earlier this month showing that the world market for medical devices rode product innovations and emerging-market penetration to sales of $322 billion in 2011, an increase of 5 percent over the previous year.
“Our list of bellwether companies boosted R &D spending eight percent on average,” said Bruce Carlson, Kalorama’s publisher. “It's an indication of long-term optimism and a signal that the strategy is to find new products and product innovations in order to get around the lower reimbursements.”
Not all shared in the scope of the success. The firm said in its May 15 announcement of the report’s availability that, despite broad market growth, such prominent companies as Johnson & Johnson, Medtronic and Siemens Healthcare were among those whose revenues failed to keep pace with the rate of growth in the overall market.
Kalorama pointed out that the industry will continue to face challenges in coming years as fiscal austerity programs roll out in Europe and elsewhere. “2011 was a year of cost control,” said Carlson. “Governments implemented policies unfavorable to medical device makers and hospitals took steps to reduce device pricing. These trends are likely to continue.”
The industry’s pro-active approach to the tough times reflects companies’ plans to enable “better price leverage” going forward, according to Kalorama.
The report is titled “The Global Market for Medical Devices, 3rd Edition.”