5 Big Changes in the Medical & Life Sciences Products Industry
- Fluctuating senior populations mean ebbs and flows in medical-product needs. As baby boomers continue to age, the demand for lab and medical products grows. Conversely, over the next couple of decades, members of that generation will begin to dwindle. But the elderly population is expected to double again by the middle of this century, as life expectancies increase dramatically. Long story short: sales of laboratory testing and supply items that are steady right now may drop off temporarily and expand again—meaning that making solid client connections early gives you an edge over competitors.
- Medicare is experiencing growth in spending, while ACA constraints attempt to even it out. As more people become of Medicare-eligibility age, the Affordable Care Act has tried to curb unruly growth, which can have an adverse effect, too. Cuts in patient insurance reimbursements to healthcare providers and facilities are causing concern about product accessibility to patients in need of them. Although an excise tax was placed on medical and lab products in 2014, a moratorium and extension has been placed through 2019, postponing the 2.3% taxes on medical products and immediately making doctors and facilities prime sales targets.
- Medical products are largely separated from set pricing, so visibility is increasingly important. Because patients are billed for doctor visits and procedures and not for lab equipment and supplies, it’s difficult to appraise costs. Current legislation and a shift toward value-based care lead the industry toward fewer medical procedures and the aforementioned cuts in reimbursements to providers, all of which drive down purchasing from and profit for medical-product manufacturers. In this climate, it’s more important than ever for marketing campaigns to serve value-based messages to all members of a clinical buying committee.
- Traditionally, innovation has driven the life-sciences product industry. Now, it’s a bit trickier. As the medical field transforms itself continually, there is less room for new products. Inventing has its own set of risks, financial and otherwise, and development of new devices is research-heavy and full of red tape. While the government places hefty regulations on the medical-products field, these also help curb competition with patenting restrictions. It’s no surprise how crucial timing is for lab-supplies manufacturers trying to acquire new providers for new products.
- Biotech testing is predicted to offset any stagnation. If 80% of diagnoses come as a result of common, routine laboratory testings, then the need for supplies will fluctuate significantly as baby boomers make their exits. Globally, medical labs are increasing spending nevertheless with the emergence of biotech and at-home testing kits. As all these changes are made over the next several decades, adapting to emerging trends and technologies with ABM makes all the difference in excelling in the life-science products industry as a whole.