NRI Papers
No. 202 August 1, 2015
  An Increasingly Aging World and Expectations for the Medical Device Industry  
Ai SATO, Mia MATSUO, Ryosuke FUJITA, Eisuke YOSHIMURA and Mie NAKAHARA

The global medical device market, which had a market size of about 400 billion dollars as of 2014, is predicted to grow at an annual growth rate of 6.5 percent from 2011 to 2017. In 2013, all of the top-ranked companies in terms of profit margin and sales in this market were either European or U.S. manufacturers. The environment in which Japanese manufacturers compete with them will be affected by trends in patient care and the health care policy of each government. Another noteworthy factor that affects this environment is the U.S. manufacturing reshoring initiative.

The problems of the health care industry are not limited to rapidly growing health care costs in developed countries. An aging population and worsening health conditions have increasingly become matters of concern not only in developed countries but also in emerging economies. Compared with the pace at which their economies grow, a rapidly increasing number of older populations in emerging economies presents a serious problem.

Against this background, contributions that are required of medical device manufacturers include: (1) lowering the prices of existing products, (2) optimizing the operations of medical institutions and nursing care facilities, (3) developing innovative products and services and (4) improving the effects of preventive medicine. The areas of contribution (3) and (4) above are primarily aimed at developed countries.

Thanks to the American manufacturing reshoring initiative, U.S. medical device manufacturers, which receive support for strengthening technology development capabilities from the U.S. government, are highly likely to achieve technological innovation at an early stage in the areas of (2), (3) and (4) above and gain first-mover advantage. On the other hand, because of bias in the support measures provided by the Japanese government fs health care policy, Japanese manufacturers are likely to fall behind their American competitors. In particular, Japan needs to quickly expand and improve measures to support the medical device industry with an eye to supplementing sales functions.

For more comprehensive discussions about the medical device business, please see the July 2014 issue of Chiteki Shisan Souzou (Knowledge Creation and Integration) featuring gIryo-kiki bizinesu ni yoru jigyo seicho wo gensou ni owarasenai tameni (Don ft let projected business growth driven by the medical device business end up being a mere dream) h (only available in Japanese).

Contents
I Trends in the Global Medical Device Market and the Industry fs Business Structure
II Increasingly Aging Populations and Worsening Health Indicators throughout the World
III Contributions Required of Medical Device Manufacturers
IV The U.S. Manufacturing Reshoring Initiative and the Future of the Medical Device Industry

PDF GO to PDF

Copyright(c) Nomura Research Institute, Ltd. All rights reserved.