This article was originally distributed via PRWeb. PRWeb, WorldNow and this Site make no warranties or representations in connection therewith.
The Medical Device Cleaning and Recycling industry has grown in popularity during the five years to 2012. The Great Recession was a strong boon to the industry; the poor economic environment resulted in fewer people with health insurance coverage. In turn, the number of insured patients in hospital rooms shrank, contributing to declining operating profit margin for these key customers. Healthcare providers' shrinking revenue and mounting costs made relatively cheaper reprocessed medical devices more appealing. These trends are forecast to persist through 2017, and aspects of the 2010 healthcare reform will start to benefit the industry starting in 2014, when growth is projected to pick up. For these reasons, industry research firm IBISWorld has added a report on the Medical Device Cleaning and Recycling industry to its growing industry report collection.
Los Angeles, CA (PRWEB) May 21, 2012
The Medical Device Cleaning and Recycling has grown in popularity during the five years to 2012. Revenue is expected to increase 20.5% per year on average to $372.5 million during this period. “The Great Recession was a strong boon to the industry,” says IBISWorld industry analyst Sophia Snyder. “The poor economic environment resulted in fewer people with health insurance coverage. In turn, the number of insured patients in hospital rooms shrank, contributing to declining operating profit margin for these key customers.” Healthcare providers' shrinking revenue and mounting costs made relatively cheaper reprocessed medical devices more appealing. As the economy continues its slow recovery in 2012, growth is expected to decelerate to 12.0%.
Environmental awareness has also been on the rise to the benefit of the industry. Major player Stryker Sustainability Solutions reportedly reduces 2,150 tons of medical waste per year while saving hospitals in supply costs. Additionally, Snyder says, “the aging population and rising incidence of diseases that can be treated with medical devices are fostering industry growth.” These trends are forecast to persist in the Medical Device Cleaning and Recycling industry through 2017. And aspects of the 2010 healthcare reform will start to benefit the industry in 2014.
The industry's growth has not gone unnoticed. Original-equipment manufacturers (OEMs) have previously tried to discourage recycling medical devices on the basis of safety concerns. In response, the Food and Drug Administration conducted studies to determine the safety of reprocessed medical devices. The resulting standards and regulations caused costs to rise in the industry and pressured operating profit margin down. Even though heightened standards have made hospitals and patients feel more comfortable with reprocessed devices, competition from OEMs is projected to persist in the next five years, conceivably through the development of devices that are more difficult to reprocess or through lower prices that make reprocessed devices less economically appealing. OEMs are also expected to progressively enter the industry themselves, either through adding services or acquisitions. Acquisitions are expected to keep the number of operators low despite strong revenue growth that will lure new entrants into the industry. The Medical Device Cleaning and Recycling industry has an extraordinarily high degree of market share concentration. Concentration has increased steadily during the past five years, primarily driven by Stryker's and Johnson & Johnson's growth and the exit of many noncompliant establishments. Notable acquisitions include Stryker's acquisition of Ascent Healthcare Solutions in 2010. At the time, Ascent Healthcare was one of the largest medical device reprocessors, thus, substantially increasing Stryker's market share. In 2011, Johnson & Johnson acquired SterilMed, which aided the company in its efforts to remain at the forefront of the industry. For more information, visit IBISWorld’s Medical Device Cleaning and Recycling in the US industry report page.
Follow IBISWorld on Twitter: https://twitter.com/#!/IBISWorld
Friend IBISWorld on Facebook: http://www.facebook.com/pages/IBISWorld/121347533189
IBISWorld industry Report Key Topics
This industry owns and operates medical waste reprocessing centers where reusable medical waste is recycled, cleaned, recalibrated, repackaged and resterilized. Industry firms then sell the goods back to hospitals and medical suppliers.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.
For the original version on PRWeb visit: http://www.prweb.com/releases/prweb2012/5/prweb9521615.htm