MedTech

~$430 billion worldwide sales driven by focus on healthcare outcomes and costs

The global medtech industry is forecasted to grow 5.4% p.a. through 2022, reaching global sales of ~$430 billion. Growth in this sector is typically derived from innovations that improve patient care and new product iterations. Over the next five years, in vitro diagnostics and cardiology are anticipated to represent the largest segments of the market, and neurology the fastest-growing.

A key influence on the medtech market is the focus on health outcomes and costs. Private and public sector payers are more closely measuring device performance and related costs, creating opportunities for low cost, disruptive solutions with better performance characteristics to take share. This trend will be accelerated by the shift from “fee for service” payment to “risk-based” forms of reimbursement.

The convergence of information technology with medical devices is also altering the landscape. Medical devices are combining with mobile technology to create new applications that reduce costs and improve healthcare performance. Evaluating a patient’s most important health measures is no longer tied to an office visit. This immediacy of information, in a wide range of diseases, is transforming the practice of medicine and lies at the center of lowering healthcare spending and improving patient outcomes.

We believe there are attractive investment opportunities in the medtech space that play into these themes.