The medical device sector is one of the primesegments of the healthcare industry. This industry has been outsourcing medical device manufacturing services for nearly a decade now. Since then, outsourcing has been a helping hand for medical device companies to cut-down development costs by almost 10% to 30%. Hence, regardless of the risingoperationalcosts, themedical device industryhas witnessedsignificantdevelopment duringthe past decade.
Drivers of medical device manufacturing outsourcing industry
Several healthcare and medical device companies are currently putting efforts in maintaining companyand industry productivity byoffering an amazinglyhigh level of quality in product development. They are adopting a variety of creativecost-cutting techniques and one among them is the increasinglypopular strategy of outsourced manufacturing.
On the other hand, a significant rise in the cases of chronic diseases including diabetes, cancer, CVDs (Cardiovascular Diseases), and others has increased the demand for efficient medical devices. Furthermore, factors such as a decrease in time and cost required to introduce a new product into the marketis one of the key factors fueling the growth of medical device manufacturing outsourcing sector. Besides,surge in the life expectancy, and increasing demand for technical adoption in the medical devices industry are contributing to the development of the medical device manufacturing outsourcing industry.
Whereas, increased attention and demand from various healthcare companies is unveiling lucrative opportunities for the continued growth of the medical device manufacturing outsourcing industry.Additionally, another factor which is boosting the trend toward outsourcing manufacturing services is the need to cut down operational costs. The growing demand and huge profit margins of the medical device manufacturing industry have enticedseveral new market players, and has boosted the competition in the industry. The entry of new medical device manufacturers has also increased the demand for outsourcing services.
Recent trends in the industry
Looking at the increased demand for outsourcing services, it is clear that various outsourcing companies that are operational in the medical manufacturing industry are likely to get merged. A latest example of this is the acquisition of TNCOInc. (Whitman, MA) by Symmetry Medical, a company offering manufacturing solutions for complex, high-precision products and services for medical devices. Symmetry Medical is mainly involved in the production of surgicalimplants and instrumentsfor the orthopedic device segment. With this acquisition,TNCO, focusseson designing, developing,and manufacturing devices for laparoscopic, arthroscopic, nasal sinus surgeries, and other minimallyinvasivetreatments.With Symmetry's greater scaleand resources, the mergedcompany will be able to develop and expandon TNCO's intellectual competencesand expandrapidly and effectivelyin TNCO's arenas of specialty andincrease its market share.
There are various other companies currently dominating the global medical device manufacturing outsourcing industry by adopting various activities such as development of new techniques, merges & collaborations, acquisitions, and geographical expansions. Some of these companies are Creganna, Tecomet, Inc., FLEX LTD., Nortech Systems, Inc., Mitutoyo Corporation, Integer Holdings Corporation, DAIICHI JITSUGYO CO., LTD., Cirtec, Hamilton Company., and Kinetics Climax Inc.
Future scope of the industry
The industry for outsourced medical manufacturing is growing at an increased rate.
According to a report by Research Dive, the global medical device manufacturing outsourcing market is foreseen to grow at a CAGR of 10.3% from 2019 to 2026. Medical device firmsare expected to obtain a continuous flow of an extensive range ofoptions that offer outsourcing manufacturing services in order to reduce their costs, capital investments, and time to market. The rapid growth coupled with a high demandis expected tobring in several lucrative opportunities for the development of global industry.