Dive Brief:

• The medtech industry is projected to grow at a compound annual rate of 5.6% worldwide from 2017 through 2024, reaching $595 billion, according to a new analysis from Evaluate Ltd. that also ranks fastest-growing specialties, biggest companies and top R&D spenders.
• Total medtech R&D spending is seen growing by 4.5% to hit $39 billion by 2024. Medtronic, the biggest medical device maker by sales, is also the biggest R&D spender, but smaller players such as Edwards Lifesciences and bioMérieux invest a much larger percentage of their sales in R&D.
• The number of new devices receiving first-time FDA approval in 2017 matched a previous 10-year high set in 2015.

Dive Insight:

With FDA working on a number of new policies aimed at getting devices to market more quickly, premarket approvals (PMAs) and 510(k) clearances are up. Total products approved through PMA, humanitarian device exemption (HDE) or product development protocol (PDP) pathways rose to 51 in 2017 from 40 the year before. The number of 510(k) clearances increased 9% to 3,248, also a new peak.

Cardiology devices received 20 PMAs in 2017, more than any other therapy area. Abbott Laboratories won six first-time PMAs and HDEs, the most for a single company. Medtronic received the largest number of overall approvals and clearances at 791.

Medtronic, the largest medtech company in 2017 with sales of $30 billion, is expected to remain the leading device maker with sales of $38.9 billion forecast for 2024, according to Evaluate. Becton Dickinson will soon enter the top five thanks to its purchase of C. R. Bard. After Medtronic, the largest medical device makers by sales currently are Johnson & Johnson, Abbott Laboratories, Siemens Healthineers, Philips, Stryker, Roche, Becton Dickinson, General Electric and Boston Scientific.

Medtronic is also the biggest spender on research and development with $2.25 billion in 2017, representing 7.5% of sales. But a number of device makers, including several of its competitors, spend a larger percentage of their sales on R&D. Among them are Abbott with 10.2% of medtech sales spent on R&D, Boston Scientific with 10.8%, Edwards Lifesciences with 16.1% and Intuitive Surgical with 10.5%. Among the top 20 medtech companies in the report, the average R&D budget represented 8.7% of sales.

The report also ranked the largest and fastest-growing medical device specialties. The top 10 device areas by sales are in vitro diagnostics, cardiology, diagnostic imaging, orthopedics, ophthalmics, general and plastic surgery, endoscopy, drug delivery, dental and diabetes care.

In vitro diagnostics is projected to remain in the No. 1 spot in 2024 with annual sales of $79.6 billion and a 13.4% share of the medical device industry. The fastest-growing device specialty, however, is neurology, expanding at a rate of 9.1% a year with sales expected to reach $15.8 billion in 2024. The slowest-growing segments in the top 15 are diagnostic imaging and orthopaedics, both expected to see compound annual growth of just 3.7% between 2017 and 2024.