In the holiday season, On Target Editor Chris Ross takes an express tour of the European medical device market and looks at how medical technology is making a difference – not only to public health, but also to the economy.

In the June issue of On Target, we looked at how investment in medical technologies holds the key to wealth as well as health. This article focuses on the medical devices market in Europe, which is estimated by Eucomed to be worth €55.2 billion. This represents a 30% share of a global sector worth €184 billion. To understand why the medical devices sector is worth investing in, we need to look at what makes it special: its distinctive nature (see Figure 1), its diversity (see Figure 2) and its growing importance for public health.

The big €

Germany, France, Italy, the UK and Spain account for almost 78% of the European medical devices market, with Germany and France alone accounting for 51%. However, even the most mature markets are beset with challenges in the current environment. In Germany, the largest European market, growth is being driven by good export performance as the domestic market battles healthcare reforms, financial difficulties and cost-containment policies. Similarly in France, performance has been badly hit by poor economic growth and government cost-containing measures, driven by an almost constant deficit in its national health insurance fund. Healthcare in Italy and Spain is also in a state of flux, with both countries trying to devolve administrative and financial responsibilities to the regions in order to control spending.

The UK is Europe’s third-ranked market for medical devices. In fact, Britain is home to the largest number of medical technology companies in Europe. However, per capita spending is relatively low compared to other Western European countries. The UK invests around 7.5% of its GDP in health, but less than 5% of this amount is spent on medical devices. This is below the European average of 6.4%. While the NHS accounts for around 80% of all healthcare expenditure, a small specialist private healthcare sector also plays a role in the market. To reduce waiting times, preferred supplier status has been given to private healthcare groups in orthopaedics, ophthalmology, general surgery, primary care services and local procurement.

Saving lives and fighting disability

According to Frost & Sullivan, the total European medical devices market will grow to $77.8 billion by 2010. Cardiovascular devices are currently the leading European single product segment for devices (19%), followed by orthopaedics and surgery. Over the next five years, Frost & Sullivan forecasts that the cardiovascular devices market will grow by around 25%.
Eucomed reflects these trends by citing the following disease areas as key challenges in which medical devices can make an impact in the coming years: cardiovascular disease, cancer, diabetes and musculoskeletal conditions. Cardiovascular disease is the leading cause of death in Europe, killing 4 million people each year – 46% of all women and 38% of all men. Eucomed points out that interventional cardiology (including coronary angiography and coronary stents), arrhythmia and stroke management all provide great examples of the contribution medical technology makes to patient care. Such innovations not only improve patients’ quality of life, but also relieve the economic burden of lengthy hospital stays.
Cancer is the second largest killer in Europe. The World Cancer Report predicts that global cancer rates could increase by 50% between now and 2020. Medical technology assists the screening, diagnosis and treatment of cancer, as well as helping to restore quality of life post-surgery. Medical science shows that cure rates in cancer improve when early detection is combined with optimal treatment – a good example of how medical devices and pharmaceuticals can work together to improve public health. Diabetes is emerging as one of Europe’s major killers. Eucomed notes that medical technology plays a vital role in diabetic patient care, and can help to reduce the healthcare bill for the disease. Devices for diabetes treatment include insulin delivery products such as syringes, pens, automatic injectors, insulin patches and external or implantable pumps. Precise blood glucose monitoring can substantially reduce the risk of developing complications and slow the progression of the disease. Effective wound care reduces the frequency and length of hospital stays and the incidence of amputation in diabetic patients.
Finally, medical devices play a significant role in improving patient outcomes in four major musculoskeletal conditions: osteoporosis, osteoarthritis, rheumatoid arthritis and lower back pain. With populations continuing to live longer, osteoarthritis is projected to become the fourth leading cause of disability in Europe by 2020. Joint replacement surgery can restore the patient’s mobility, while new developments in bone, cartilage and soft tissue regeneration based on biomaterials can speed up the healing process.