Medical Device Outsourcing Market Hits $USD 50.37 billion By 2020: Grand View Research, Inc.

Global medical device outsourcing market is expected to reach USD 50.37 billion by 2020, according to a new study by Grand View Research, Inc. Increasing pricing pressure on medical device OEMs and the presence of stringent government regulations are some key drivers of the medical device outsourcing market. One such regulation involves the imposition of additional 2.3% excise duty on medical devices in the U.S. The implementation of this act increased manufacturing costs, thereby encouraging OEMs to adopt outsourcing as a cost curbing tool. Budgetary cutbacks undertaken by healthcare establishments is another key reason accounting for the increase in pricing pressure on medical device OEMs.

Product design and development accounted for over 28.0% of the market in 2013. Escalating competition in the medical device industry has heightened the importance of new product development and extensive R&D investments. Manufacturers in an attempt to mitigate risks associated with this rise in capital expenditure levels adhere to cost effective strategies, especially outsourcing. Design and development expertise offered by outsourcing firms are also expected to improve usage rates during the forecast period.

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