The European Medical Technology Industry in Figures

The European Medical Technology Industry in Figures

What is Medical Technology? Medical technology is a collective noun for medical devices, in vitro diagnostics, medical imaging equipment and e-health solutions. Billions of patients worldwide depend on medical technology at home, at the doctor s, at hospital and nursing homes. Wheelchairs, pacemakers, blood-glucose monitors, orthopaedic shoes, spectacles and contact lenses, insulin pens, hip prostheses, condoms, oxygen masks, HIV-tests, dental floss, MRI scanners, pregnancy tests, surgical instruments, bandages, syringes, life-supporting machines: more than 500,000 products (20,000 generic groups) are available today. Medical technology is used to ensure health in individuals suffering from a wide range of conditions. It extends life and brings healthy life years, reduces symptoms and prevents disease progression, thus playing an essential role in healthcare. Good health is a prerequisite for well-being and economic prosperity. Medical technology helps people live healthier, more productive, social active, independent lives and reinforces employability. Moreover, continuous medical technology innovation enhances the quality and effectiveness of care. In doing so, it contributes to steering healthcare onto a sustainable path. Diversity of Medical Technology High risk Class III Class IIB Class IIA Class I Low risk 2

The European Medical Technology Industry in Figures Despite this high diversity, the MedTech industry s common goal is to develop medical technology of the highest quality and offering the greatest benefit to patients. Products need to meet stringent quality criteria and their clinical performance is evaluated to ensure they work as designed. Moreover, each technology comes with strict instructions for use and industry continuously invests in hands-on training for physicians. At the same time, clinical investigations comprised of thousands of patients, and interviews with physicians and patients help the medical technology industry to improve its products ever more. Also, after a product has been made available to patient industry has a permanent monitoring system (vigilance) in place to ensure that any serious adverse event can be addressed quickly and appropriately. There are more than 500,000 technologies, in 20,000 generic groups. These fall within 16 categories of products, as determined by the Global Medical Devices Nomenclature (GMDN) Agency. 1 Code Classification Example 01 Active implantable technology Cardiac pacemakers, neurostimulators 02 Anaesthetic and respiratory technology Oxygen mask, gas delivery unit, anaesthesia breathing circuit 03 Dental technology Dentistry tools, alloys, resins, floss, brushes 04 Electromechanical medical technology X-ray machine, laser, scanner 05 Hospital hardware Hospital bed 06 In vitro diagnostic technology Pregnancy test, genetic test, glucose strip 07 Non-active implantable technology Hip or knee joint replacement, cardiac stent 08 Ophthalmic and optical technology Spectacles, contact lenses, intraocular lenses, ophthalmoscope 09 Reusable instruments Surgical instruments, rigid endoscopes, blood pressure cuffs, stethoscopes, skin electrodes 10 Single use technology Syringes, needles, latex gloves, balloon catheters 11 Technical aids for disabled Wheelchairs, walking frames, hearing aids 12 Diagnostic and therapeutic radiation Radiotherapy units technology 13 Complementary therapy devices Acupuncture needles/devices, bio-energy mapping systems/software, magnets, moxibustion devices, suction cups 14 Biological-derived devices Biological heart valves 15 Healthcare facility products and Gas delivery systems adaptations 16 Laboratory equipment Most IVD which are not reagents 3

Innovation Medical technology is characterised by a constant flow of innovations, which are the result of a high level of research and development within the industry, and of close cooperation with the users. Products typically have a lifecycle of only 18-24 months before an improved product becomes available. In 2012, more than 10,000 patent applications were filed with the European Patent Office (EPO) in the field of medical technology equivalent to 7 % of the total number of applications more than any other technical field. 38% of these patent applications were filed from European countries. In comparison, around 5,400 applications were filed in the pharmaceutical field and 5,300 in the field of biotechnology. While over the last decade the number of EPO filings in the field of medical technology has doubled, biotech and pharma patent applications were relatively stagnant. 2 Top technical fields in patent applications. Number of patent applications filed with EPO, 2012 2 Medical technology 10.412 Electrical machinery, apparatus, energy 9.799 Digital communication 9.592 Computer technology 8.288 Transport 6.633 Measurement 6.428 Organic fine chemistry 6.002 Engines, pumps, turbines 5.668 Pharmaceuticals 5.364 Biotechnology 5.309 Distribution of health technology fields by patent applications filed with EPO, 2012 2 Pharmaceuticals 5,309 Biotechnology 10,412 38% 6 Medical technology 5,364 Applications filed from EU28, Norway and Switzerland Applications filed from other countries Evolution of European patent applications by technical field 2 Biotechnology Pharmaceuticals Number of patent applications filed with EPO 12 000 10 000 8 000 6 000 Medical technology 4 000 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 4

The European Medical Technology Industry in Figures Employment in Europe The European medical technology industry employs more technology industry is an important player in the European than 575,000 people. Germany has the largest share of economy. In comparison, the US medical technology total employment, while the number of medical technology industry employs around 520.000 people 4 while the employees per capita is highest in Switzerland and Ireland. 3 European pharmaceutical industry employs 675.000 This high level of employment shows that the medical people 5. Number of people employed in the medical technology industry 3 200 000 70 150 000 Number of employees 60 50 Number of employees per 10 000 inhabitants 40 100 000 30 20 50 000 10 0 0 Germany United Kingdom France Italy Switzerland Companies in Europe Spain Switzerland Ireland Denmark Sweden Germany Belgium United Kingdom France Netherlands Italy Portugal Spain Greece There are almost 25,000 medical technology companies in Europe. Most of them are based in Germany, followed by the UK, Italy, Switzerland, Spain and France. Small and medium-sized companies (SMEs*) make up almost 95% of the medical technology industry, the majority of which employ less than 50 people (small and micro-sized companies). 6 95% SMEs * An enterprise is considered to be an SME if it employs fewer than 250 persons and has an annual turnover not exceeding 50 million (Small company - employs fewer than 50 persons and has a turnover of less than 10 million). 5

100 bn European Market The European medical technology market is estimated at roughly 100 billion 7. Medical technology offers solutions for many disease areas. On a worldwide perspective, in vitro diagnostics are the largest segment, followed by cardiology and diagnostic imaging. Medical technology market estimates by area and sales growth, World, 2012-2018 8 % WW Market Share in 2012 16% 14% 1 10% 8% Orthopedics Diagnostic imaging Cardiology In vitro diagnostics Endoscopy Ophthalmics 6% 4% Drug delivery Wound management Dental General & plastic surgery 0% 2,0% 2,5% 3,0% 3,5% 4,0% 4,5% 5,0% 5,5% 6,0% 6,5% Note: Bubble size = WW Sales in 2012 % Sales growth: CAGR 2012-2018 Based upon manufacturer prices the European medical technology market* is estimated to comprise around 30% 9 of the world market. It is the second largest medical technology market after US (40% 9 ). World medical technology market * by region, based upon manufacturer prices, 2012 9 European medical technology market * by region, based upon manufacturer prices, 2012 9 5% 10% 1 39% US Europe Japan China Russia Canada Brazil Other 3% 3% 3% 4% 4% 5% 14% 10% 27% 16% Germany France United Kingdom Italy Spain Netherlands Switzerland Sweden Belgium Austria Other 28% 11% 6

The European Medical Technology Industry in Figures The European market has been growing on average by 4% 10 per annum over the past 6 years. European medical technology market* growth rates, based upon manufacturer prices, 2008-2013 10 10% 8% 6% Annual growth rate 4% Trend 0% 2008 2009 2010 2011 2012 2013 * Market size estimated in manufacturers prices, not including margins, such as value added in the wholesaling and retailing, transportation costs, some taxes included in the final price, etc. Medical technology not including in vitro diagnostics. IVD specific information is available at European IVD Market Statistics Report 11. Trade Europe has a positive medical technology* trade balance of 15.5 billion (2012), more than a twofold increase since 2006. In comparison, US medical technology* trade surplus is at 5.3 billion. 9 Exports and imports of medical technology* by country, 2012 (including European intra-trade) 9 Germany Netherlands Belgium Switzerland Ireland France United Kingdom Italy Sweden Denmark Austria Finland Export Import Spain Czech Republic Poland Billion EUR 0 5 10 15 20 25 7

Top European medical technology* export destinations, 20129 Russia 5.5% Canada 3% US 41% China 9.5% Brazil 2.5% Japan 10% Australia 4% Top suppliers to European medical technology* market (imports), 20129 US 65% China 10.5% Japan 7% Singapore Australia Medical technology* trade balance by country, 20129 8 7 6 5 4 3 2 1 Billion EUR -2 er G -1 m an Ire y Sw la itz nd Ne erla th nd er la n Be ds lg De ium nm ar Fin k la Sw nd ed Hu en ng Lit ary hu an Es ia to ni a La tv Bu ia lg a Cz Sl ria ec ove h Re nia pu bl Au ic st r Cr ia oa t ia Sl ov a Ro kia m an G ia re e Po ce rtu ga No l rw a Po y la nd Un ite d Ita Ki ng ly do m Fr an ce Sp ai n 0 *Medical technology not including in vitro diagnostics. 8

The European Medical Technology Industry in Figures Expenditure on Medical Technology In Europe, an average of 10.4% of gross domestic product is spent on healthcare. Of this figure, around 7.5% is attributed to medical technologies. The spending on medical technology varies significantly across European countries, ranging from around 5% to 10% of the total healthcare expenditure. 7 Expenditure on medical technology per capita in Europe is at around 195 7 (weighted average), compared with 380 in the US 12. Breakdown of total healthcare expenditure in Europe 13 17% 0.8% Inpatient & outpatient care, other Phamaceuticals & other medical non-durables 75.5% 7.5% 6.7% Medical technology Medical devices (incl. imaging) In vitro diagnostics Per capita spending on various fields, in EUR, latest year available 7 Education Environmental protection Pharmaceuticals Medical technology 195 450 560 1600 0 500 1000 1500 2000 9

The European Medical Technology Industry in Figures References 1 Global Medical Devices Nomenclature (GMDN) Agency, 2010. 2 European Patent Office, Eucomed calculations. Medical technology as defined by World Intellectual Property Organization (based on the WIPO IPC-Technology concordance as revised in August 2012). European countries refer to EU + Norway, Switzerland. Patents are attributed by the country of residence of the applicant. 3 Eurostat, Eucomed calculations based on the data obtained from National Associations of 15 countries for the latest year available. Countries with (partially) provided data: Belgium, Czech Republic, Denmark, France, Germany, Greece, Ireland, Italy, Netherlands, Poland, Portugal, Spain, Sweden, UK, Switzerland. Europe refers to EU + Norway, Switzerland. 4 S. Tripp, M. Grueber, R. Helwig - The Economic Impact of the U.S. Advanced Medical Technology Industry, Battelle Technology Partnership Practice, March 2012. 5 EFPIA The Pharmaceutical Industry in Figures. Key Data 2013. Europe refers to EU + Norway, Switzerland. 6 Eucomed calculations based on the data obtained from National Associations of 15 countries for the latest year available. Europe refers to EU + Norway, Switzerland. 7 WHO Global Health Expenditure Database, Eurostat, Eucomed calculations based on the data obtained from National Associations of 15 countries for the latest year available. Countries with (partially) provided data: Belgium, Czech Republic, Denmark, France, Germany, Greece, Ireland, Italy, Netherlands, Poland, Portugal, Spain, Sweden, UK, Switzerland. Europe refers to EU + Norway, Switzerland. 8 World Preview 2013, Outlook to 2018: The Future of Medtech, EvaluateMedTech, September 2013.www.evaluategroup.com/ MedTechWP2013. 9 Espicom, Eucomed calculations. Manufacturer prices. Medical devices and Imaging excluding in vitro diagnostics. Europe refers to EU (excluding Cyprus, Luxembourg, Malta) + Norway, Switzerland. 10 Espicom, Eucomed calculations. Average growth rate over 2008-2013 years. Manufacturer prices. Medical Devices and Imaging excluding in vitro diagnostics. Europe refers to EU (excluding Cyprus, Luxembourg, Malta) + Norway, Switzerland. 11 http://www.edma-ivd.eu/uploads/market%20intelligence/2011_eu_ivd_market_statistics_report-2.pdf 12 WHO; G. Donahoe and G.King - Estimates of Medical Device Spending in the United States, F.S.A., M.A.A.A. AdvaMed, 2012. 13 WHO, Eurostat, EFPIA, EDMA, Eucomed calculations. 10

About MedTech Europe MedTech Europe is an Alliance of European medical technology industry associations. The Alliance was founded in October 2012 and currently has two members being EDMA, representing the European in vitro diagnostic industry, and Eucomed, representing the European medical devices industry. The Alliance was established to represent the common policy interests of its members more effectively and efficiently. Its mission is to make value-based, innovative medical technology available to more people, while supporting the transformation of healthcare systems onto a sustainable path. As such, the medical devices and in vitro diagnostics industries are jointly executing their industry strategy. In 2012 MedTech Europe published the Contract for a Healthy Future, the medtech industry s 5-year strategy, and Creating Value in European Healthcare. Contract for a Healthy Future details the role of Europe s medical technology industry in steering healthcare systems onto a sustainable path, while the Creating Value in European Healthcare - publication explains how Europe's medical technology industry is delivering on the promise of the Contract. Both publications are available at www.reforminghealthcare.eu

www.edma-ivd.eu www.eucomed.org www.medtecheurope.org www.reforminghealthcare.eu 12 2013