The medical device industry has escaped unscathed from the recent manufacturing downturn and is now one of the UK's key manufacturing growth areas, according to recent research.
The research, which was conducted among 105 leading UK medical device manufacturers as part of an independent study on behalf of the organisers of the Medical Device Technology Exhibition, shows that the medical device manufacturing industry is now worth an estimated €3.19 billion. Unlike their counterparts in other manufacturing industry sectors which are being forced to make cut-backs, the medical device manufacturing industry is looking to expand still further. The recent NHS budget increase is in part responsible for this positive effect on business with over half predicting an increase in spending on medical devices from hospitals and health organisations in the UK. Respondents also predict that sales will increase by over a third in the next year through new products and new export markets. According to the study, not all this predicted growth will be organic: 40% of companies are planning to merge with or acquire a UK or overseas business in the next two years to gain a competitive edge. With fierce competition in this market, it comes as no surprise that manufacturers' business priorities for the year ahead centre on product innovation. The vast majority (84%) of manufacturers are planning to develop new products for current markets, whilst 75% are planning to extend current products to new markets. Consequently innovation is high on everyone's agenda, with more than four-fifths stating product innovation as the number one priority and 72% reporting they have launched an innovative product or service in the last year. Investment in research and development highlights the optimism in the industry. Nearly half of respondents (46%) see their R&D spend increasing by on average 34% during the next twelve months – a 14% increase on last year's R&D forecasts. However, the general downturn in manufacturing has been noted by the sector. This year, reducing costs has leapt up the rankings as a key business issue. In last year's study 56% saw this as a priority – this year the figure has significantly increased to 80% - placing it at the second most important business priority.