For those interested, we recommend reading this extremely interesting article, from Area Studi Mediobanca MedTech, which analyzed the annual financial statements of the 227 major Italian MedTech companies with an aggregate turnover of 18.6 billion, 40% of which comes from export.

In 2021, the worldwide turnover of MedTech industry is estimated at 535.6 billion euros, with an expected average annual growth of 5.7%, reaching 632.6 billion in 2024.
The sector represents 5.5% of the world healthcare spending, and it invests in research for 33 billion euros, over 6% of the turnover.

The global market is divided between:

  • In vitro diagnostics (IVDs), which is worth 97 billion euros, with an expected average annual growth of 4.9%;
  • Medical Devices (MDs) with 439 billion euros and an an expected average annual growth of 5.9%.

MedTech industry also grew in 2020 (+ 6.8%), thanks to the exceptional use of some products related to the fight against the pandemic (masks, cannulas, syringes, antigen tests, ventilation equipment), while other sectors suffered, such as orthopedics and dentistry, whose performance has been postponed.

The major demographic trends linked to the extension of life expectancy are now back to support the sector for the years to come.

North America is the world leader, with 193 billion euros of sales in 2021 (36% of the total), followed by Europe with 155 billion (28.9%). Asia is advancing rapidly to 136 billion (25.5%), with an expected expansion of 9.7% per year, almost double the global expectactions of growth. The specialties with the highest global turnover are cardiology, with 57.7 billion (+ 8% expected), medical imaging, with 50.1 billion (+ 3.2%), orthopedics, with 39.4 billion (+3,1%), general and plastic surgery, with 33.6 billion (+ 11%) and ophthalmology, with 32.2 billion (+ 9.2%). Important development prospects await diabetes devices (+ 15.3%) and nephrology (+ 10.6%).

The European panorama is dominated by Germany with 41.7 billion (26.9% of the total), ahead of France with 23.5 billion (15.2%), the United Kingdom with 17.8 billion (11.5%). and Italy with 17.2 billion (11.1%).

In Italy

Italy has a more important position in in vitro diagnostics, where it accounts for 12.7% of the European market, with a turnover of 1.9 billion, which makes it the third largest producer (in 2014 it was the second European player with 16.3% of the market).
Italy is the sixth exporter in the EU-27 with 4.3 billion euros, preceded by Germany (28.4 billion euros), the Netherlands (25.5 billion), Ireland (11.5 billion), Belgium (9.8 billion) and France (7.4 billion), and the 13th world exporter.

The main markets for Italian export are the United States (11.6% of the total Italian export), followed by Germany and France (both 9.3%).

In 2018-2020, the Italian MedTech sector achieved an average annual growth of 7%, with the foreign turnover (+ 9%) which grew faster than the national one (+ 5.7%).

  • In 2020, the aggregate turnover of the 227 main Italian MedTech companies amounted to 18.6 billion euros, of which 8.9 billion from production companies and 9.7 billion from commercial companies. Foreign ownership predominates, with 102 companies with a turnover of almost 10 billion euros (53.5% of the total). Foreign ownership is prevalent in commercial companies (73.6% of sales), minority in production (31.5%).
  • In 2021, an average growth in turnover of 6.4% is expected, with higher expextations for the foreign market (+ 8.2%) than for the domestic market (+ 4.7%).
  • The projections for 2022 are also optimistic, with an expected +6.1% growth compared to 2021, which breaks down into +6.4% across the border and + 5.8% in Italy.Investments also grew in 2021 with an increase of 9.6%, and by 2022 52% of companies plan to further increase their investments on the previous year.

    Italian laboratory diagnostics companies (4.5 billion) and medical imaging companies (3.3 billion) account for 42% of the total turnover, followed by companies operating in the treatment of cardiovascular and cardiopulmonary diseases (2 billion) and those operating in pneumology and otolaryngology sectors (1.8 billion).

Devices applied to infusion, nutritional and transfusion therapies recorded 1.4 billion sales, while products related to the orthopedic branch achieved sales of approximately 1 billion. Around 0.8 billion in turnover are produced by protective equipment, medical dressing and surgical instruments and ophthalmological devices. The dental sector marks 0.6 billion in sales and the furnishings close the list with 0.2 billion euros.

In 2020 the health emergency pushed the whole sector (+ 5.8%) with extraordinary exploits for biomedical producers (+ 19.3% on 2019), producers of contrast agents, reagents and diagnostic tests (+19%) and laboratory equipment (+ 17.3%). Among the areas of specialization, we underline the great performance of personal protective equipment, surgical dressing and instrumentation (+45.3%) and laboratory diagnostics (+ 27.4%). Meanwhile, the sectors of ophthalmology (-12.5%), orthopedics (-11.1%) and dentistry (-9.5%) were suffering.

The entire sector recorded an export share of 39.9% in 2020. Within it, with 53.8%, prostheses and contrast agents, reagents and diagnostic tests stand out (51.2%).

The war between Russia and Ukraine and the economic sanctions imposed on the former seem to have little impact in the immediate term on the Italian manufacturers of medical devices who are not very present in those territories.
However, there may be repercussions in the long term, although it is currently difficult to assess their extent. The war between Russia and Ukraine is also causing further increases in the prices of raw materials whose value had already increased in 2020 and 2021 following the health crisis.

In particular, some commodities used in the production of medical devices (iron, stainless steel, plastic materials and electronic components) recorded significant increases. All this must be added to the surge in costs for transport and for imports of components, semi-finished and finished products as well as the increases in gas and electricity prices, requiring a strengthening of the commitment for renewable sources, also for sustainability reasons.

Source: Area Studi Mediobanca MedTech