Global Pandemic Energizes Medical Device Industry Outlook
The medical device industry is a cornerstone component of the healthcare sector. Ranging from surgical to cardiovascular and orthopedic, medical devices have a wide application across many areas of medicine. In 2020, the diagnostic and monitoring-focused medical devices have been a key focus, as the world scrambles to contain the virus’s spread.
According to the market research firm Lucintel, the global medical device market was not immune to the economic impacts of COVID-19. However, the firm notes that medical device recovery will likely occur quickly in 2021. Lucintel estimated that the global medical device market could reach an estimated value of $426.2 billion by 2025, which represents a compound annual growth rate (CAGR) around 4%.
Cardiovascular Devices Estimated to Remain Largest Segment
Heart health-focused medical devices represent the largest segment of the overall industry. Lucintel estimates that will likely continue the foreseeable future. The market research firm highlights growing population of obesity, inactive lifestyles, and bad eating habits, as key reasons for the continued growth in cardiovascular devices.
Cardiovascular diseases continue to be the leading cause of death for men and women in the United States, according to the Centers for Disease Control. That means that roughly one person dies every 36 seconds in the U.S. from a cardiovascular disease. On an annual basis, these diseases account for roughly 655,000 American lives, or about 1 in every 4 deaths.
Given that 2020 has been largely a year of lockdowns and stay-at-home-orders (depending on where you live), one could make the argument that the pandemic has likely only increased our sedentary lifestyle. This could have longer term repercussions for the already-deteriorating state of cardiovascular health across the United States.
PRISM Emerging Med-Devices Index
Investors Prism maintains an index covering the medical device industry. The PRISM Emerging Med-Devices Index tracks small- and micro-cap companies that are focused on the development and marketing of medical devices.
Currently, the index tracks 59 companies and has seen returns of 49.20% year-to-date, as of mid-December 2020. In fact, eleven of the index’s components have seen triple-digit gains this year this far. Here is a breakdown of the top five winners from the PRISM Emerging Med-Devices Index:
- Retractable Technologies, Inc. (NYSE: RVP): 641.20%
Retractable Technologies is engaged within the research, development, manufacture, and marketing of retractable syringes and other related medical products.
- Allied Healthcare Products, Inc. (NASDAQ: AHPI): 279.40%
Allied Healthcare Products focuses on medical devices for a wide range of respiratory and anesthesia purposes.
- Alpha Pro Tech, Ltd. (NYSE: APT): 249.70%
Alpha Pro Tech has two key business segments, Building Supply and Disposable Protective Apparel. The company’s Disposable Protective Apparel business supplies everything from caps and gowns to lab coats, face masks, shoe covers and more.
- Inspire Medical Systems, Inc. (NYSE: INSP): 164%
Inspire Medical Systems describes itself as a medical technology company, which focuses on the development and commercialization of medical devices for patients with obstructive sleep apnea (OSA).
- Pro-Dex, Inc. (NASDAQ: PDEX): 129.40%
Pro-Dex is a global provider of surgical instruments and components for medical device original equipment manufacturers. One of the main products offered are multi-purpose surgical drivers and shavers used in the orthopedic, thoracic, and maxocranial facial markets.
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