Impact of COVID-19 on the Medical Devices Market Size, Share, Industry Analysis and Regional Forecast, 2020-2027

The impact of the COVID-19 outbreak on the medical devices market is expected to be significant as increasingly more countries resort to lockdowns to control the spread of the disease.

As of 15^th April 2020, there are around 2 million cases and 127,000 deaths resulting from the COVID-19 outbreak. About one-third of the global population is under lockdown. The pandemic has caused an exponential growth in demand for healthcare products such as ventilators, medical clothing, face masks, and diagnostic devices whereas the sales of companies, whose products rely heavily on elective and non-essential procedures, are expected to be hurt badly. Many such medical device companies have either withdrawn or revised their financial guidance for 2020 due to the uncertainty associated with the degree and duration of the impact of the outbreak.

Based on the analysis of Fortune Business Insights, the short-term impact of COVID-19 is expected to cause a decline in annual growth rate of the global medical devices market from 5.4% to 3.0% in 2020. The global medical devices market, which was projected to be worth USD 472 billion in 2020 before the outbreak of this infectious disease, is now expected to generate USD 461 billion this year.

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Key Reasons for the Impact of COVID-19

Decline/Delay in Elective Procedures

With the outbreak spreading to over 180 countries, elective procedures are being delayed as countries have diverted their healthcare resources to contain the pandemic. For example, the Centers for Medicare and Medicaid Services (CMS) has announced that all non-essential procedures in the U.S. will be delayed during the outbreak. In China and Italy, which went into lockdown earlier than other countries to control the outbreak, the number of elective medical procedures declined by up to 80-90% in February and March.

The impact of the decline or delay in elective procedures on the demand for medical devices is significant as these types of procedures account for around 40%-50% of the facility’s revenues in an average hospital in the U.S.

Supply Chain Disruptions

The supply of medical devices or the raw material/components required for the manufacturing of medical devices were disrupted as many countries went into lockdown. The forced quarantine in China has hit the supply-chain the hardest as the country has transitioned from being a key player in the manufacturing of low-end to high-end medical devices. There are over 60 manufacturers of essential medical devices with headquarters in the U.S. and manufacturing facilities in China. To exacerbate the situation, the majority of the top 10 global medical device companies have a manufacturing facility in China.

With a huge increase in the demand for certain medical products, few countries have barred the exports of essential medical devices, especially the devices that are vital in fighting against the outbreak. For example, the U.S. government directed 3M to prioritize the sales of protective masks to the domestic market and halt exports. This has further augmented the supply chain disruption.

For Ex. In the U.S., imports account for 30% of the total demand for medical devices in the country. Also, the U.S. exported medical devices valued at around US$ 48 billion in 2018, with Europe, China, and Japan being the major export destinations accounting for around 60% of the exports.

Strong Impact of China, a Growing Market for Medical Devices

China is one of the countries that has been hit the hardest due to the COVID-19 outbreak. As of 15^th April, there are more than 83,000 cases and over 3,300 deaths from the COVID-19 outbreak in the country. China, which accounted for around 7% of the global medical devices market, was projected to grow at a CAGR of around 10% in the 2018-2025 period before the outbreak. The demand for medical devices is expected to decline considerably in the first quarter of 2020 in China and impact the revenues of all major medical device companies.

China accounts for a considerable proportion of the sales of major medical devices, which are as follows;

• Zimmer Biomet – 5%


• Smith & Nephew – 7%


• Medtronic – 7%


• Boston Scientific – 5%


• Becton Dickinson and Co – 7%

A Large Number of Countries Impacted

Around 184 countries are affected by the COVID-19 outbreak and the key reason for the global spread of the disease is the interconnected global economy with countries being dependent on each other due to international trade and global supply chains. The top 10 countries affected by the COVID-19 outbreak accounted for around 65% of the global medical devices market in 2019.

Segmentation

“The demand for medical devices used in minimally invasive and elective procedures will be affected during the lockdown period.”

The In-vitro diagnostics market was valued at USD 58 billion in 2019 and accounted for around 13% of the global medical devices market

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The level impact due to the outbreak will vary across different medical device markets. For example, the demand for orthopedic implants and dental devices is significantly dependent on non-essential or elective procedures and hence these segments have high exposure to the COVID-19 pandemic. On the contrary, the demand for respiratory care devices and clinical diagnostics has grown tremendously in the wake of this outbreak, thereby giving the lowest exposure to these market segments. The report provides a detailed qualitative and quantitative analysis on the level of impact of COVID-19 across different medical device market segments.

Low level of exposure to the COVID-19 outbreak

• In-vitro Diagnostics


• Diagnostic Imaging


• Respiratory Care


• General Hospital and Healthcare Supplies

High level of exposure to the COVID-19 outbreak

• Orthopedic Devices


• Cardiovascular Devices


• Minimally Invasive Surgical Devices


• Dental Equipment and Devices


• Diabetes Care Devices


• Ophthalmic Devices

List of Significant Tractions due to COVID-19 Outbreak

• Medical Clothing


• Medical Masks


• Ventilators


• Molecular Diagnostics


• Respiratory Devices


• Personal Protective Equipment


• Hospital Beds


• Point-of-care Diagnostics


• Rapid Diagnostics


• Critical Care Equipment

Key Market Players

“Top 10 companies accounted for around 40% of the global medical devices market in 2018.”

All the major medical device manufacturers have been impacted by the COVID-19 outbreak but the level of impact varies based on their product portfolio – if it is diverse or focuses on market segments that are heavily impacted due to the outbreak.

For example, companies such as Stryker and Boston Scientific that rely heavily on elective procedures for the demand for their products are expected to have a high level of exposure. On the contrary, companies such as Abbott and Roche have a low level of exposure as they either have a diverse portfolio or focus on market segments least affected by the COVID-19 pandemic.

Revenue Growth Projections Scaled Back by Major Medical Device Companies due to the Impact of COVID-19

• Boston Scientific expects revenues to decline by up to $40 million in the first quarter of 2020


• Smith & Nephew projects that revenues will decline by up to 8% in the first quarter of 2020


• GE expects to take a hit of up to $300 million in profits in the first quarter of 2020 with the company’s healthcare and aviation businesses to be affected the most.


• ConMed has downgraded its revenues in the first quarter of 2020 from 5-6% to 2-3%.

The report provides a detailed qualitative and quantitative analysis on the level of impact of COVID-19 on major medical device manufacturers along with the measures taken by these companies to minimize the impact.

• Medtronic PLC


• Abbott


• Siemens Healthineers AG


• Johnson & Johnson Services, Inc.


• Koninklijke Philips N.V


• Stryker


• F. Hoffmann-La Roche AG


• BD


• GE Healthcare


• Boston Scientific Corporation


• Other Major Players

KEY INDUSTRY DEVELOPMENTS:

• March 2021 – F. Hoffmann-La Roche Ltd, launched eight new configurations for cobas pro integrated solutions, in countries accepting the CE mark with an aim to increase testing capacity of clinical laboratories.


• March 2021 – F. Hoffmann-La Roche Ltd., acquired GenMark Diagnostics, with an aim to include its novel technology to test for broad range of pathogens with one patient sample


• February 2021 – Siemens Medical Solutions USA, Inc., announced that its laboratory-based SARS-CoV-2 antigen assay (CoV2Ag) received the CE mark.


• February 2021 – F. Hoffmann-La Roche Ltd., received a special approval by the German Federal Institute for Drugs and Medical Devices to offer the SARS-CoV-2 rapid antigen test using a simple nasal swab for patient self-testing in Germany.


• January 2021 – Johnson & Johnson subsidiary DePuy Synthes received the U.S FDA approval for its VELYS robotic-assisted solution designed for use with the ATTUNE total knee system

Regional Analysis

"Medical Devices Market Segments with Positive and Negative Impact due to COVID-19 Outbreak"

The North America medical devices market value stood at USD 177 billion in 2019 and accounted for around 39% of the global medical devices market.

An Infographic Representation of COVID-19 Impact Medical Devices Market

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The level of impact of the COVID-19 outbreak will vary across regions as well and the level of exposure experienced by different regions and countries will depend on various factors such as:

• Number of COVID-19 cases/deaths and growth in the infection rate


• Burden on the healthcare system to fight against the outbreak


• Number of elective procedures performed


• Penetration of minimally invasive surgical technologies


• Initiatives taken by the government or companies to reduce the impact of CIVID-19


• Per capita medical device spending

The report provides a detailed analysis of the level of impact of COVID-19 across different regions/countries by taking these factors into consideration.

Conclusion

• Medical device companies that rely on elective surgeries for revenue generation will see a bigger impact as compared to the ones that rely on emergency surgeries


• COVID-19 is expected to have a short-term impact on the global medical devices market but the long-term impact is projected to be minimal to none


• The outbreak is expected to cause a delay in mergers, acquisitions, partnerships, and product development activities in the medical devices sector

The report developed by Fortune Business Insights on ‘Global Medical Devices Market – Impact of COVID-19’ will answer the following questions;

• What is the short-term and long-term impact of COVID-19 on the global medical devices market?


• What is the short-term and long-term impact of COVID-19 on the demand for medical devices in major regions and countries?


• What is the short-term and long-term impact of COVID-19 on the various medical device market segments?


• What is the segmentation of the various medical device market segments based on the high, medium and low levels of impact of COVID-19?


• What is the segmentation of the major medical device companies based on the high, medium and low levels of impact of COVID-19?


• What are the short-term and long-term opportunities offered by the COVID-19 pandemic in the medical devices market?


• What are the factors that are driving the impact of COVID-19 on the global medical devices market?


• What is the impact of COVID-19 on the supply chain of medical devices?


• What are the steps being taken by companies to minimize the impact of COVID-19 on their business units/revenues?


• What are the steps being taken by the government/industry to minimize the impact of COVID-19 on the medical devices market?


• What are the key industry developments in response to the impact of COVID-19?