The answer to that depends on the level of competitiveness. "America is the acknowledged world leader in medical technology, but that leadership is being challenged," said Stephen J. Ubl, CEO of Advanced Medical Technology Association (AdvaMed). "We know medical technology has a bright future. The question is: will that future be made in America -- or somewhere else? Without the right public policies in place to provide a level playing field between the U.S. and foreign competitors, America's leadership will be lost."
And there is real concern as other nations are catching up to the U.S. in this field. A recent Innovation Scorecard, produced by PwC, found that on a scale of 1 to 9 the U.S. currently has a total score of 7.1. Other developed nations (the UK, Germany, Japan and France) are moving up and fall within a tight band of 4.8 to 5.4. Among the developed countries included in this study, Germany and the UK demonstrate the strongest support for innovation and Japan the weakest. And Israel ranks near the level of the European nations indicating a strong capacity to foster innovation, says PwC.
The emerging markets rank lower with China at 3.4, and India and Brazil, each of which scored 2.7.
"The medical technology field in the U.S. has long benefited from a confluence of social, technical, political and economic forces that came together to create an ecosystem which fosters medical technology innovation," said Michael Swanick, U.S. Pharmaceuticals, Medical Device and Life Sciences industry leader, PwC. "However, the balance of these forces is beginning to change, driven by global economic dynamics, governmental policies and the actions of individual companies and entrepreneurs. As the innovation ecosystem evolves, it creates challenges for those countries and companies that have ridden this wave -- and offers opportunities to those, in the US and around the world, who find themselves well-positioned to adapt to new modes of innovation."
Currently the industry employs 422,788, according to AdvaMed. The group calculates that this has an overall impact on U.S. jobs of 1.96 million. The value of the annual exports is $33 billion, produced by 7,000 companies with 62% of the firms having less than 20 employees. To view a state-by-state map of employment click here.
Last month AdvaMed outlined a Competitiveness Agenda which proposes specific recommendations under six broad policy imperatives:
- Innovation in the life sciences must be a government priority, including requiring an innovation impact statement for significant new regulations that affect the health sector.
- The FDA review process must be reformed to reduce total review times. American patients should have as prompt access to new treatments as do European patients.
- Payment policies of Medicare, Medicaid and private insurers must support medical innovation and not penalize early adopters of new treatments and cures.
- A vigorous trade policy must support export growth and provide a level playing field for U.S.-based manufacturing.
- Strategic tax policies to level the playing field must be implemented, including improvements to the R&D tax credit to keep it competitive with other countries.
- The American research and development infrastructure must be sustained and improved. Special emphasis should be placed on creating research structures that support commercialization of the R&D.
"Medical technology is a source of life-enhancing and life-sustaining treatments and cures, but it also is an important manufacturing industry and a driver of current and future U.S. economic growth," said Stephen P. MacMillan, CEO, Stryke.