Technological advances, the legislative expansion of healthcare access, and the improving economy have stimulated demand. With advancements in technology, operators have expanded the reach of customers. This has also been supported with increased research and development efforts and government intervention. The aging US population has further contributed to the sector’s revenue growth, due to the high incidence of health issues requiring medical devices within the elderly population. These dynamics have propelled consistent demand, and control revenue volatility in the sector.
Value of Closed Domestic M&A Transactions ($mm)
Sector Performance vs. National GDP
The elderly population and technological developments will continue to bolster the sector’s growth, but changing the regulatory environment will likely hamper profitability. With increased regulation, the sector will likely see consolidation with medical device manufacturers. The sector’s revenue is anticipated to rise as healthcare providers continue to invest in newer equipment to keep up with growing demand for healthcare services. New product development by medical device manufacturers will also contribute to the sector’s growth by offering new solutions to health issues. Mergers and acquisitions (M&A) among medical device manufacturers will cause wholesalers to consolidate in order to maintain negotiating power and meet the demands of newly expanded customers. Consolidation will help sector operators reduce costs, therefore leading to a rise in profit margins.