MEDICAL DEVICE CONTRACT MANUFACTURING MARKET ANALYSIS

The global medical device contract manufacturing market was valued at US$ 88.8 Bn in 2022 and is forecast to reach a value of US$ 192.3 Bn by 2030 at a CAGR of 10.2%between 2023 and 2030. The global medical device contract manufacturing market is experiencing strong growth due to the increasing prevalence of chronic diseases and increasing demand for medical devices around the world. Moreover, growing trend of medical device contract manufacturing and the outbreak of COVID-19 (pandemic) is expected to propel the market growth. However, factors such as stringent rules and regulations and risk of consolidation are expected to hamper the market growth.

Global Medical Device Contract Manufacturing Market: Regional Insights

Based on geography, the global medical device contract manufacturing market is segmented into North America, Latin America, Europe, Asia Pacific, Middle East, and Africa.

Among regions, North America is expected to gain highest share in the market during the forecast period owing to the increasing prevalence of chronic disease, growing demand for medical devices, growing deployment of Industry 4.0, and increasing adoption of technologically advanced medical devices in the region. For instance, according to the US Centers for Disease Control and Prevention (CDC), chronic diseases such as heart disease, cancer, and diabetes are the leading causes of death and disability in the U.S. With the rise in burden of chronic diseases, demand for medical devices used to diagnose and treat such conditions is also increasing rapidly.  

Europe and Asia Pacific are expected to witness significant growth in the medical device contract manufacturing market owing to the rise in burden of chronic disease, growing geriatric population, increasing demand for medical devices, and rapid growth of the pharmaceutical industry in these regions. For instance, European Medical Contract Manufacturing B.V. is a centre of excellence in developing and manufacturing medicinal products, catering to the Biomaterials, Pharmaceuticals, and Tissue Engineering markets. European Medical Contract Manufacturing B.V. (EMCM) is a manufacturer of sterile medicinal products.

Figure 1. Global Medical Device Contract Manufacturing Market Share (%), by Region, 2023

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Global Medical Device Contract Manufacturing Market Drivers:

Rise in burden of chronic diseases to drive market growth

One of the key factors expected to augment growth of the medical device contract manufacturing market during the forecast period is the increasing prevalence of chronic diseases across the world. With the increasing prevalence of chronic diseases, the use or demand for medical devices is also increasing, as they are used to prevent, diagnose, and treat such conditions. According to the World Health Organization (WHO), chronic diseases kill 41 million people each year, equivalent to 74% of all deaths worldwide. Every year, over 17 million people die from a chronic disease before age 70; 86% of these premature deaths occur in low- and middle-income countries.

Increasing demand for medical devices to propel market growth

Another factor driving the growth of the global medical device contract manufacturing market is the increasing demand for medical devices around the world. For instance, with the rise in global disease burden and growing geriatric population around the world, the demand for novel medical devices is also increasing rapidly. In May 2022, Biomerics, one of the leading vertically integrated medical device contract manufacturers serving the interventional device market, opened 2,000 sq. ft. balloon and balloon catheter centre of excellence in Galway. This is Biomerics' first facility in Europe and the second facility outside the United States after Costa Rica.

Global Medical Device Contract Manufacturing Market Opportunities:

Growing trend of medical device contract manufacturing is expected to provide significant growth opportunities for players in the global medical device contract manufacturing market. For instance, in May 2023, ONCAP planned to invest in Biomerics, a Salt Lake City, Utah-based medical device contract manufacturer focused on micro-plastics, micro-metals, image-guided intervention, and/or final device assembly for interventional sectors. Biomerics will have over 1.2 million square feet of manufacturing space across several locations, making it one of the top Interventional Contract Development and Manufacturing Organizations worldwide.  

The outbreak of COVID-19 (global pandemic) is expected to offer significant growth opportunities for players in the global medical device contract manufacturing market. For instance, COVID-19 pandemic increased the demand for medical device such as personal protective equipment (PPE), ventilators, and diagnostic tests, among others. In March 2022, Medtronic increased the production of ventilators by more than 40% due to the global coronavirus (COVID-19) outbreak and to cater to the increase of demands of patients and healthcare systems across the world; to help meet urgent demand from hospitals worldwide fighting the novel coronavirus.

Global Medical Device Contract Manufacturing Market Trends:

Growing trend of outsourcing is a recent trend

Medical device contract manufacturing is the outsourced manufacturing of medical devices for the healthcare marketplace. Original equipment manufacturers (OEMs) around the world are looking for contract manufacturers who have adequate resources, plant space, and machine time to adapt to the changing market demands. OEMs are constantly looking for contract manufacturers (CMs) who can guide them in increasing their product portfolio and help them offer innovative products. This trend is expected to continue during the forecast period.

Increasing demand for IVD devices is another trend

IVD (in vitro diagnostic) medical device is used to determine the status of a person's health. They are used to test human samples, where the results can assist in clinical diagnosis or management. The use of IVD devices is increasing in medical facilities as the adoption rate for these devices is higher among end users. This can be attributed to factors such as rise in burden of chronic diseases, growing number of hospitals in developing countries and improving healthcare infrastructure. This trend is also expected to continue over the forecast period.

Global Medical Device Contract Manufacturing Market Restraints:

Stringent rules and regulations to hinder market growth

One of the key factors expected to hamper the growth of the medical device contract manufacturing market is the stringent rules and regulations. With increase in adverse effects by the use of medical devices, countries with strong medical device industry initiated the process of either developing or strengthening their regulatory systems. The need for regulation has increased primarily to enable access to high-quality, safe, and effective medical devices for patients. The product is developed according to the specifications sent by the OEMs in compliance with guidelines.

Risk of consolidation to hamper the market growth

Another factor which is hampering the growth of the global medical device contract manufacturing market is the risk of consolidation. For instance, the top global medical device manufacturers are acquiring small/medium-sized specialized companies to enhance their internal capabilities. Other companies are focusing on acquiring contract manufacturing organizations (CMOs) to reduce their expenses related to the contract manufacturing. This in turn is expected to transfer small percentage of manufacturing from CMOs to OEMs.

Figure 2. Global Medical Device Contract Manufacturing Market Share (%), by Device, 2023

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Global Medical Device Contract Manufacturing Market Segmentation:

The global medical device contract manufacturing market report is segmented into Device, Product, Service, and Region.

Based on Device, the market is segmented into Class I, Class II, and Class III. Out of which, Class II Segment is expected to dominate the medical device contract manufacturing market over the forecast period and this is attributed to the increasing demand for Class II medical devices.

Class III Segment is also expected to witness robust growth in the near future and this is due to the increasing prevalence of chronic disease and growing geriatric population.

Based on Product, the market is segmented into Electronics Manufacturing Services, Raw Materials, and Finished Goods. Out of which, Electronics Manufacturing Services Segment is expected to dominate the market during the forecast period and this is attributed to the increasing demand for technologically advanced medical products.

Finished Goods Segment is also expected to witness significant growth in the near future and this is owing to increasing demand for medical devices across the globe.

Based on Service, the market is segmented into Product Manufacturing and Assembly Services, Quality Management Services, Packaging and Sterilization Services, Regulatory Consulting Services, and Product Design and Development Services. Out of which, Product Manufacturing and Assembly Services Segment is expected to dominate the market over the forecast period and this is attributed to the growing trend of contract manufacturing.

Product Design and Development Services Segment is also expected to witness robust growth in the near future and this is owing to the increase in research and development worldwide.

Global Medical Device Contract Manufacturing Market: Key Developments

In June 2022, Belgian contract manufacturer Amnovis and medical device service provider BAAT Medical teamed up to offer an innovative and rapid turnaround process for 3D printed medical devices.

In November 2021, Biofortuna, a contract development, and manufacturing partner to the IVD and point-of-care testing sectors, doubled its manufacturing capacity following its relocation to new state-of-the-art facilities in Deeside, North Wales.

In September 2021, TE Connectivity acquired three companies focused on microfluidic cartridge and blister reagent package development, usability testing, clinical research, and manufacturing, including Toolbox Medical Innovations (California, USA), which provides development, usability testing, clinical research, and manufacturing services for Point of Care IVD products.

In June 2021, Somnics, Inc. and Maxnerva Technology Services signed a cooperation agreement regarding the contract development and manufacturing organization (CDMO) of IVD devices.

Global Medical Device Contract Manufacturing Market: Key Companies Insights

The global medical device contract manufacturing market is highly competitive. This is attributed to the rise in burden of chronic disease and growing geriatric population, as a result, players in the market are focusing on launching novel products in the market.

Some of the key players in the global medical device contract manufacturing market are Flex, TE Connectivity, Sanmina, Jabil, Celestica, Plexus, and Tecomet, among others.

*Definition: Medical device contract manufacturing (CM) is the system by which a manufacturing company manufactures medical devices and components of medical devices that can be then sold by another company. The product is developed according to the specifications sent by the original equipment manufacturer (OEM) in compliance with ISO:13485 and FDA guidelines.