EY 'Pulse of the MedTech Industry Report 2025'

The EY Pulse of the MedTech Industry Report 2025 indicates that the global medical technology (MedTech) sector is robust, with strong financial fundamentals and a heightened focus on high-growth, differentiated innovation despite geopolitical uncertainty and trade headwinds.
 
Key Financial Insights and Market Trends 📈

Resilient Revenue Growth: The industry recorded its seventh consecutive year of top-line growth, reaching approximately US$584 Billion. Commercial leaders are projected to achieve 6% to 7% revenue growth again.

"Safe Harbour" Status: MedTech is proving to be a relative "safe harbour" compared to the broader healthcare industry, with strong performance in areas like orthopaedics (16% revenue growth) and ophthalmics (28% surge).

Concentrated Funding: Investment activity is characterized by fewer, larger deals:

Venture Capital (VC): Total VC investment climbed 20% to US$8.7 Billion, but the number of rounds dropped 47%. The average round swelled significantly to US$37 Million.

M&A Focus: Total M&A spending was below historical norms, but the average deal size increased substantially (up 72% over the decade average), with a focus on acquiring later-stage, high-growth assets closer to profitability.

High-Growth Segments: Investor confidence is concentrated in technologies driving differentiated innovation in key therapeutic areas:

Robotics
Pulse Field Ablation (PFA)
Structural Heart
Diabetes
 
Strategic Imperatives for MedTech Leaders 💡

The report highlights that sustained success will depend on companies proactively addressing several strategic challenges:

Proving the "Right to Grow": Companies must demonstrate not just growth, but the ability to earn that growth through healthy margins and effective capital allocation.

Advanced Operating Models: Organizing around autonomous business units (rather than a strictly regional model) is proving to outperform competitors.

Adapting to Trade Friction: Companies are compelled to build tariff task forces and reconfigure supply chains, often shifting towards "local-for-local" manufacturing to mitigate risk from trade uncertainty.

Harnessing AI: Integrating advanced data and Artificial Intelligence (AI) tools is critical for transforming operations, enhancing diagnostics, and improving supply chain resilience.

Source: https://www.ey.com/en_us/life-sciences/pulse-of-medtech-industry-outlook