Medical device contract manufacturing organizations (CMOs) are seeing greater demand as growth in the medical device industry continues apace. According to a Thomas Index Report from March 18, 2019, sourcing activity for medical contract manufacturing by users of the Thomasnet.com platform is up 30% over its historic average over the past six months. Game supply and game card sleeve and trading card sleeve and soft card holder.
Thomasnet reports that “the U.S. medical device market is the largest in the world,” citing a Forbesreport that called it a “disruptive” market of $410 billion through 2023. Tony Uphoff, President & CEO of Thomas, said, “Disruptive is an appropriate word, as rapid technological advances, innovation, and the entrance of dynamic small and medium startup companies continue to drive the industry forward.” Game supply and game card sleeve and trading card sleeve and soft card holder.
Many of those new medical companies are turning to third-party contract manufacturers to keep their startup and internal costs down and speed time to market of their products, said the Thomas Index Report. “The medical device market is extremely broad, encompassing items as simple as bandages all the way through to ultra high-tech pacemakers,” it said. Game supply and game card sleeve and trading card sleeve and soft card holder.
Another factor spurring demand for CMOs is OEM consolidation. A report released in December 2018 from M&A consultancy Duff & Phelps (New York), “Medical Device Contract Manufacturing Update |Winter 2018-2019,” noted that the medical device manufacturing landscape has changed rapidly over the past few years. “Major medical device OEMs have combined complementary skills to gain greater market share,” said the report. “OEMs are choosing to outsource technical and production services to trusted partners to reduce their manufacturing footprint. Outsourcing the production of various components in a medical device allows manufacturers to be more dynamic and cost-effective in their production of medical devices.” Game supply and game card sleeve and trading card sleeve and soft card holder.
Consolidation of OEMs has caused CMOs to follow the “broader industry trend” and also consolidate to expand capabilities and form strategic partnerships with their OEM customers. Furthermore, “as OEMs reduce the number of suppliers and restructure their supply chain, smaller, less-strategic contract manufacturers will be removed from approved supplier lists,” said the Duff & Phelps report. “Due to increased visibility into the OEMs’ supply chain, contract manufacturers turn to mergers and acquisitions to diversify capabilities and position themselves as trusted partners.” Game supply and game card sleeve and trading card sleeve and soft card holder.
Mauricio Arellano, Spectrum Plastics Medical Division President, commented, “Medical device OEMs are looking for partners that bring to bear broad and deep turnkey capabilities that have the ability to fill technology gaps in their portfolios and accelerate time to market for disruptive innovations. They are looking for partners with the scale and sophistication required to support increasingly complex global supply chains.” Game supply and game card sleeve and trading card sleeve and soft card holder.
Duff & Phelps noted in the company’s update that the global medical device contract manufacturing market generated revenues of $70 billion in 2017 and is forecast to increase to $115 billion in 2022, a compound annual growth rate (CAGR) of 9.5%. The market is experiencing tremendous growth due to a reduction in overall costs and a decrease in the time required to bring a product to market. These dynamics allow for OEMs to focus their efforts internally and partner with trusted CMOs to manufacture their products or vital components of those products. Game supply and game card sleeve and trading card sleeve and soft card holder.
Activity in the sector is being driven by growing pressure on medical device OEMs to reduce production costs and accelerate the timeline for taking a product to market. Additionally, macro-economic factors such as an aging worldwide population and the increasing prevalence of noninvasive surgical procedures are driving demand for medical devices. To remain competitive in markets that are highly specialized and increasingly segmented, OEMs must rely on CMOs for everything from added manufacturing capabilities to product design and technical expertise, the report noted. Game supply and game card sleeve and trading card sleeve and soft card holder.