Electromedical & X-ray Apparatus Manufacturing
Description
Companies in this industry manufacture magnetic resonance imaging and ultrasound equipment, pacemakers and other devices, and irradiation apparatus for medical or industrial uses. Major US companies include Abbott, GE Healthcare Systems, Hologic, Varian Medical Systems, and Zoll Medical, as well as divisions Johnson & Johnson. Outside the US, major companies include Hitachi Healthcare (Japan), Medtronic (Ireland), Philips (Netherlands), Siemens Healthineers (Germany), and Sonova (Switzerland).
The diagnostic imaging equipment market, which includes X-ray imaging and electromedical systems, is forecast to reach a revenue of about $60 billion at a compound annual growth rate (CAGR) of 4.35% by 2029, according to Statista. North America dominates the market due to the increase in chronic diseases, growth in the geriatric population, and increase in government funding. Growth is driven by aging populations and rising occurrences of noncommunicable conditions such as heart disease and cancer.
The US electromedical and X-ray apparatus manufacturing industry includes about 1,000 establishments with combined annual revenue of about $45 billion.
COMPETITIVE LANDSCAPE
Demand is driven by technological advancements, demographics (the aging US population drives the need for medical products), and the needs of the health care industry. The profitability of individual companies depends on efficient operations and effective marketing. Large companies enjoy economies of scale in research, manufacturing, marketing, and distribution. Smaller companies can compete effectively by developing innovative technologies or specialty products for niche markets, such as cancer therapy apparatus. In the US, both the electromedical and the X-ray apparatus segments are highly concentrated: the 50 largest companies account for about 85% and 98% of revenue, respectively.
Imports of electromedical and X-ray apparatus products, mainly from Mexico, Germany, Ireland, Japan, China, and the Netherlands, account for bout 40% of the US market. Exports account for about 35% of US production. Major export markets for US manufacturers include China, the Netherlands, Japan, Canada, Germany, and France.
PRODUCTS, OPERATIONS & TECHNOLOGY
Major products include MRI, CT, and PET scanners, along with X-ray, mammography, ultrasound, fluoroscopy, and nuclear medicine equipment. Other products are hearing aids, pacemakers, defibrillators, electrocardiographs, and electromedical endoscopic equipment.
Customers include hospitals, clinics, imaging centers, and physicians' offices. Health care providers use the equipment to visualize inside the human body and diagnose and treat illnesses or injury.
MRI (magnetic resonance imaging) machines consist of a large tube with a strong magnet that causes the atoms inside the body to line up in certain ways. The wires that form the magnet are supercooled in a liquid helium bath that is insulated in a vacuum. Magnet strength ranges from 1.5 tesla and 3.0 tesla, while scanners used mainly in research have magnet strengths of 7.0 tesla to 11.0 tesla. The equipment is expensive, with prices ranging from $300,000 to more than $500,000, depending upon the quality of the images.
Ultrasound machines consist of a transducer that produces sound waves and receives echoes using a piezoelectric effect. The CPU processes the echoes and creates the image for the researcher or physician. New ultrasound machines cost around $20,000 to $200,000 or higher.
A CT or CAT (computerized or computed tomography or computerized axial tomography) scanner uses X-rays to scan a consecutive series of images, called slices. These slices are then put together into a composite image. Prices for a CT scanner range from $100,000 to $300,000 or more, depending on the tier.
Pacemakers are placed in the chest or abdomen to help control abnormal heart rhythms. A pacemaker consists of a battery, computerized generator, sensors (electrodes), and wires. Electrodes detect the heart's activity and send data to the generator, which sends electrical pulses to the heart if its rhythm is abnormal. Recorded data, which is used by physicians to fine-tune treatment, typically can be accessed remotely.
Products are complex and require highly specialized raw materials. Some companies contract out subassembly work and install and test these units in-house. Raw materials may include tungsten, lead, rhenium, molybdenum zirconium, and copper, radioactive materials for X-ray and nuclear medicine equipment, and steel alloy for X-ray tubes. The supply of these materials is volatile, causing pricing to fluctuate. Companies also purchase sensors, semiconductors, motors, and other electronic components, as well as metal castings and forgings, from third-party suppliers.
Companies conduct quality control assessments throughout the manufacturing process, from inspection of raw materials, to testing of purchased assemblies to inspection of the final product. Facilities are often certified according to the International Standards Organization (ISO), which governs quality control.
There is a market for secondhand and refurbished machines; resales are a big part of industry revenue.
The diagnostic imaging equipment market, which includes X-ray imaging and electromedical systems, is forecast to reach a revenue of about $60 billion at a compound annual growth rate (CAGR) of 4.35% by 2029, according to Statista. North America dominates the market due to the increase in chronic diseases, growth in the geriatric population, and increase in government funding. Growth is driven by aging populations and rising occurrences of noncommunicable conditions such as heart disease and cancer.
The US electromedical and X-ray apparatus manufacturing industry includes about 1,000 establishments with combined annual revenue of about $45 billion.
COMPETITIVE LANDSCAPE
Demand is driven by technological advancements, demographics (the aging US population drives the need for medical products), and the needs of the health care industry. The profitability of individual companies depends on efficient operations and effective marketing. Large companies enjoy economies of scale in research, manufacturing, marketing, and distribution. Smaller companies can compete effectively by developing innovative technologies or specialty products for niche markets, such as cancer therapy apparatus. In the US, both the electromedical and the X-ray apparatus segments are highly concentrated: the 50 largest companies account for about 85% and 98% of revenue, respectively.
Imports of electromedical and X-ray apparatus products, mainly from Mexico, Germany, Ireland, Japan, China, and the Netherlands, account for bout 40% of the US market. Exports account for about 35% of US production. Major export markets for US manufacturers include China, the Netherlands, Japan, Canada, Germany, and France.
PRODUCTS, OPERATIONS & TECHNOLOGY
Major products include MRI, CT, and PET scanners, along with X-ray, mammography, ultrasound, fluoroscopy, and nuclear medicine equipment. Other products are hearing aids, pacemakers, defibrillators, electrocardiographs, and electromedical endoscopic equipment.
Customers include hospitals, clinics, imaging centers, and physicians' offices. Health care providers use the equipment to visualize inside the human body and diagnose and treat illnesses or injury.
MRI (magnetic resonance imaging) machines consist of a large tube with a strong magnet that causes the atoms inside the body to line up in certain ways. The wires that form the magnet are supercooled in a liquid helium bath that is insulated in a vacuum. Magnet strength ranges from 1.5 tesla and 3.0 tesla, while scanners used mainly in research have magnet strengths of 7.0 tesla to 11.0 tesla. The equipment is expensive, with prices ranging from $300,000 to more than $500,000, depending upon the quality of the images.
Ultrasound machines consist of a transducer that produces sound waves and receives echoes using a piezoelectric effect. The CPU processes the echoes and creates the image for the researcher or physician. New ultrasound machines cost around $20,000 to $200,000 or higher.
A CT or CAT (computerized or computed tomography or computerized axial tomography) scanner uses X-rays to scan a consecutive series of images, called slices. These slices are then put together into a composite image. Prices for a CT scanner range from $100,000 to $300,000 or more, depending on the tier.
Pacemakers are placed in the chest or abdomen to help control abnormal heart rhythms. A pacemaker consists of a battery, computerized generator, sensors (electrodes), and wires. Electrodes detect the heart's activity and send data to the generator, which sends electrical pulses to the heart if its rhythm is abnormal. Recorded data, which is used by physicians to fine-tune treatment, typically can be accessed remotely.
Products are complex and require highly specialized raw materials. Some companies contract out subassembly work and install and test these units in-house. Raw materials may include tungsten, lead, rhenium, molybdenum zirconium, and copper, radioactive materials for X-ray and nuclear medicine equipment, and steel alloy for X-ray tubes. The supply of these materials is volatile, causing pricing to fluctuate. Companies also purchase sensors, semiconductors, motors, and other electronic components, as well as metal castings and forgings, from third-party suppliers.
Companies conduct quality control assessments throughout the manufacturing process, from inspection of raw materials, to testing of purchased assemblies to inspection of the final product. Facilities are often certified according to the International Standards Organization (ISO), which governs quality control.
There is a market for secondhand and refurbished machines; resales are a big part of industry revenue.
Table of Contents
- Industry Overview
- Quarterly Industry Update
- Business Challenges
- Business Trends
- Industry Opportunities
- Call Preparation Questions
- Financial Information
- Industry Forecast
- Web Links and Acronyms
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