As our 2024 Global Medical Device Outlook infographic illustrates, medical device manufacturers face a broad array of market challenges in 2024. That said, the global outlook for the industry is positive, with growth projections ranging from 5-7% CAGR over the next five years. Background trends offer both opportunities and threats, but overall prospects for the industry in the next year appear to be improved over 2023. If there is one challenge that stands out, it’s that of selling into an industry that is financially stressed while managing underlying costs in an inflationary environment.

Across the globe, financially stressed payers continue to raise the bar for the purchase of new products, putting a premium on products that reduce operating costs as a way of dealing with ongoing staff shortages. This translates to growing emphasis on evidence of better outcomes and lower costs based on real world evidence.

Historically, comparatively stricter medical device regulations in the EU and UK have biased companies toward the US market. While there had been hope that an update to MDRs in the EU and UK in 2024 would change the situation, those updates have been delayed, so the US remains the more accessible market, especially for smaller companies.

Even so, regulators globally will continue tough enforcement, especially in the adverse event reporting universe. Cost effectiveness evidence will play an ever more significant role in approvals. And given heightened economic pressures, government payers worldwide will continue to move toward alternative contracting frameworks like risk-based pricing.

Demanding evidence of better outcomes and lower costs, private payers will continue to expand value-based contracting, reference pricing, and direct purchasing of devices. Consumers will get more involved in choosing diagnostic tests as they also shop for lower cost, higher quality procedures. Employers and payers will look for ways to accelerate the migration of care to outpatient clinics as a path to lower costs and improved outcomes, creating new opportunities for innovative medical device makers.

In the U.S., centralization of decision-making in consolidated integrated delivery networks (IDNs) will continue to erode the influence of clinicians in buying decisions. Better positioning with these IDNs will be key to future success.

Given this outlook, what’s next?  We recommend these key action steps:

  • Redesign commercial models, targeting/segmentation.
  • Align R&D, Medical Affairs, Commercial functions.
  • Craft compelling databased economic & clinical value narratives that resonate with key stakeholders.
  • Innovate new products/services for select markets and use across the care continuum, including health at home.
  • Recruit, train talent to engage executive decision makers.
  • Elevate business acumen, diagnostic and influence skills.
  • Structure more strategic collaborations with providers/payers.

At Numerof & Associates, we help medical device manufacturers achieve these key action steps for success in today’s evolving healthcare landscape. From competitive strategy and ensuring evidence to demonstrate value to commercial model innovation and implementation, we have solutions. Read more about our perspectives and solutions for the medical device industry and see our case studies.

Need critical insights across the healthcare sector? Check out our 2024 outlook infographics for payers, healthcare delivery, and pharmaceuticals.