Medical devices for diagnostics and treatment are set to become big growth drivers over the next several years for component suppliers specializing in high-reliability medical markets. Two examples include auto-positive airway pressure (Auto-PAP) devices and diagnostic cardiology devices.
In the U.S. alone, shipments of auto-PAP devices for the treatment of sleep apnea is expected to grow 70 percent by 2017 over 2013 levels, according to IHS Technology (NYSE: IHS). The U.S. is the largest market globally for sleep apnea devices with estimated revenues of $765.3 million in 2013, according to the IHS report "Sleep Diagnostics, Sleep Therapy and Sleep Interfaces - World - 2013."
The report finds that auto-PAP device shipments will increase at a compound annual growth rate (CAGR) of 14.2 percent over the next four years, reaching 1,312,811 units by 2017, surpassing shipments of continuous positive airway pressure (CPAP) machines in 2015.
"Healthcare expenditures in the U.S. for sleep apnea have reached unsustainable levels," said Nicola Goatman, medical devices and healthcare IT analyst at IHS, in a statement. "Diagnosis through sleep laboratories and therapy using a CPAP system are no longer the most cost-effective solution to an ever-worsening problem."
The move to auto-PAP devices is driven by functionality. These devices provide variable pressure in response to the patient's requirements unlike CPAP machines. The benefit is twofold: respiratory therapists don't have to visit patients as often to modify the device as a patient's condition changes, and it reduces costs for the provider, as Medicare reimbursements for sleep therapy devices have dropped, according to the report.
Another healthcare issue driving growth is the need for early detection of cardiovascular disease, which is expected to drive demand in the global market for diagnostic cardiology devices, including electrocardiogram (ECG), stress ECG, Holter ECG, ECG management systems, remote cardiac monitoring devices and defibrillators. The global market is expected to grow 15 percent from 2012 to 2017, reaching $913.2 million in 2017, according to an IHS report “Diagnostic Cardiology – World – 2014.”
“CVD is the leading cause of death globally, with the World Health Organization estimating that 17 million people die from the disease each year,” said Holly Ingram, IHS analyst for clinical care devices, in a statement. “Of these, 3 million occur before the age of 60 that might have been prevented with early detection.”
The report finds that ECG devices are driving growth in emerging regions. However, mature markets, including the U.S. and Canada, are concerned about efficiency, which is driving the purchase of devices such as ECG management systems that can be used in hospitals' information technology (IT) systems and meet the requirements in the U.S. for maintaining electronic medical records under the Meaningful Use regulations and reimbursement rules.
Other technologies expected to drive future growth include remote cardiac monitoring devices and defibrillators, according to the report.