Need to Cut Operational and Manufacturing Costs Will Drive the Global Medical Device Manufacturing Outsourcing Market Through 2020, Says Technavio
By Business Wire News
By Business Wire News
According to the latest market study released by Technavio, the global medical device manufacturing outsourcing marketis expected to grow at a CAGR of more than 11% during the forecast period.
This research report titled ‘Global Medical Device Manufacturing Outsourcing Market 2016-2020’ provides an in-depth analysis of the market in terms of revenue and emerging market trends. This market research report also includes up to date analysis and forecasts for various market segments and all geographical regions.
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The report categorizes the global medical device manufacturing outsourcing market into six major segments on the basis of services. They are:
- Product design and development
- Product upgrade and maintenance
- Regulatory consulting
- Product testing and certification
- Supply chain management
- Product implementation
Product design and development
The outsourcing of operational activities has become standard practice in many businesses including medical devices. Design outsourcing enables companies to test ideas, develop prototypes, and work collaboratively with specialist companies that have the capabilities and resources to deliver.
According to Barath Palada, a lead analyst at Technavio for medical devices research, “Outsourced design engineering is expected to grow well in the coming years as an increased number of manufacturers from start-up ventures to large companies capitalize on the benefits associated with outsourced design engineering such as better product design and cost-effectiveness to gain a competitive edge.”
Product upgrade and maintenance
Product upgrade involves reconditioning and refurbishment. It also involves continual updates, engineering change management, field failure services, and remediation. Product upgrade services contributed a 12% market share to the global medical devices manufacturing outsourcing market in 2015. With the growing technological advancements and changing consumer needs, the demand for these services has grown substantially. Product upgrade services include redesigning for cost reduction and improved reliability, obsolescence mitigation, and product revitalization.
Regulatory consulting is one of the growing segments of the global medical device manufacturing outsourcing market. Medical devices are subject to stringent government regulations. As a result, regulatory services are constantly growing in the global outsourcing market.
Regulatory consulting companies negotiate, perform documentation work, submit data related to product testing to regulatory authorities, and apply for regulatory approvals of products on behalf of OEMs. OEMs have to comply with several regulatory guidelines to manufacture and commercialize a medical device or product. From time to time, the regulatory authorities may come up with new guidelines or amend an existing one. Owing to this, OEMs consult providers that are considered to have high expertise in regulations and documentation work.
Product testing and certification
Product testing and certification or qualification is the process of certifying that a certain product or device has qualified performance tests and quality assurance tests, and meets qualification standards stipulated in contracts, regulations, or specification. These services form an important part of medical device manufacturing outsourcing because a device needs to comply with certain standards, including environmental and other regulations. “Many OEMs prefer outside facilities for testing and certifications of their products,” says Barath.
Supply chain management
This includes sterilization, packaging, and warehousing. Warehousing the products is an expensive proposition for OEMs. It includes leasing and managing a facility, and reducing overheads. Medical technology clients utilize supply chain management services to avoid excess shipping costs, and eliminate internal overhead. For example, there is a “drop-ship” program in which the companies outsource their warehouse and shipping operations to companies such as ICAT Logistics. Another similar option is a “stock and ship” program for setting up medical carts with their products, and then send customized carts to clients. Medical technology clients can realize economies by using one of these programs.
Product implementation helps in bringing the product to the market. Time to market is an important factor for a company to launch a product. Therefore, product implementation has an immense potential in the medical device manufacturing outsourcing market. In February 2016, Norman Noble added a dedicated capacity in its process development centers to produce prototype iterations quickly for medical device OEMs.
Norman Noble process development centers support customers with ultra-precision micromachining of medical devices from initial prototype, the US FDA approval, to large-scale manufacturing. These process development centers are instrumental in bringing next-generation medical technology devices to the market and in a cost-effective manner adhering to all quality, and regulatory requirements.
The top vendors highlighted by Technavio’s research analysts in this report are:
- Creganna Medical
- Nortech Systems
Browse Related Reports:
- Global Portable Medical Devices Market 2015-2019
- Global Diagnostic Wearable Medical Devices Market 2016-2020
- Global 3D Medical Imaging Equipment Market 2016-2020
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Technavio is a leading global technology research and advisory company. The company develops over 2000 pieces of research every year, covering more than 500 technologies across 80 countries. Technavio has about 300 analysts globally who specialize in customized consulting and business research assignments across the latest leading edge technologies.
Technavio analysts employ primary as well as secondary research techniques to ascertain the size and vendor landscape in a range of markets. Analysts obtain information using a combination of bottom-up and top-down approaches, besides using in-house market modeling tools and proprietary databases. They corroborate this data with the data obtained from various market participants and stakeholders across the value chain, including vendors, service providers, distributors, re-sellers, and end-users.
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