The U.S. market is of strategic importance for the medical sector being the largest and most sophisticated in the world with $71.3 billion in sales for 2002. As a rule of thumb the U.S. market for medical devices and most of its segments represent about half of the world market (the European market representing 25%). This market is expected to grow at a compound annual rate of 8% over the next three years.
Health care system
Private payers comprised more than half of national health expenditures in 2002. Private health insurance totaled $479.3 billion, and made up the largest share within the private payers group, while out-of-pocket payments totaled $212.5 billion and comprised 16 percent of expenditures.
The public sector comprised the remaining 44 percent of health payments in the U.S. The public sector is made up of two primary components: Medicare and Medicaid. Medicare is the national health insurance program which provides coverage to approximately 40 million Americans. Covered individuals include people age 65 or older, as well as some prople under age 65 with disabilities, and people with End-Stage Renal Disease. Medicaid is a program that pays for medical assistance for certain individuals and families with low incomes and resources who meet certain eligibility requirements. Medicare spending totaled $259.1 billion (19%) while Medicare spending totaled $232.4 billion (17%).
Regulatory envionment
The complexity of the U.S. legal system needs to be treated with respect. The challenges of the regulatory environment are feasible provided the company is willing to make a careful assessment and plan accordingly.
- For importation into the United States issues related to tariff classification, transfer pricing and origin marking requirements need to be considered
- Before market entry products need the approval from the FDA. This approval is granted for products evaluated as safe and effective. It is important to note that CE marks are not recognized in the U.S.
- Product liability and court procedures differ largely from Swiss standards and demand particular attention. As a consequence the Swiss manufacturers needs to fully meet all design standards set by the FDA, make sure that comprehensive quality control is implemented, provide carefully formulated warnings and instructions, follow-up with customers, and file a complete set of all records. In addition issues related to product liability insurance need careful consideration.
Source: "The U.S. Market for Medical Devices - Opportunities and Challenges for Swiss Companies" 2004 by Swiss Business Hub USA in Chigaco.
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