While 75% of survey participants said they had "very positive" or "somewhat positive" feelings about industry's outlook in 2015, that was down from 85% percent in the 2014 survey. It also varied by geography: Executives based in Europe expressed slightly less rosy predictions than their counterparts in the Americas and Asia/Pacific. "This is not surprising given the lackluster performance of the EU economy in 2014 and dim prospects for improvement in 2015," notes the report.
Company size also has a bearing on the results. When asked how they felt about the outlook for their company in 2015, as opposed to industry in general, nearly half of small companies (fewer than 50 employees) had a "very positive" outlook; that number dipped to 38% among companies employing 250 or more people. This may be because larger companies are more vulnerable to pricing and regulatory pressures, posits Emergo.
A section of the survey devoted to challenges facing executives, which polled more than 600 presidents, CEOs and managing directors of medical device companies, predictably found that regulatory changes, product development and financing ranked highest among their concerns. When sorted by company size, however, the results were infinitely more illuminating. Funding is the overwhelming challenge of companies with one to nine employees, while changing regulations is one of the primary issues keeping executives of companies with 50 or more employees up at night. Pricing pressure is relatively low key among the smallest companies (22%), but it becomes a major headache (61%) at companies employing 250 or more people.
When asked about the growth potential of the various regions over the next five years, medical device executives ranked Asia-Pacific at the top, with 47% saying it had high-growth potential, although that is a considerable drop from the 67% that said so in the 2014 survey. Only 24% expect to see high growth in North America and 17% in Europe. Nevertheless, when asked in which markets they expect their company to have the strongest growth in 2015, 44% chose China and 43% selected the United States. Europe came in third with 37%.
The survey also took a look at the medical device excise tax (MDET), which has been called a job killer and is currently in the crosshairs of the Republican-led Congress. "Overall, about 14% of U.S. medical device firms reduced staff to make up for MDET," note Emergo analysts, with nearly 57% not making any significant changes. Here again, size matters: the larger the company, the more likely it was to reduce headcount to offset the tax.
The complete survey results can be downloaded free of charge (registration required) from the Emergo website.