The next Roaring ’20s
The medtech industry received one of the best holiday gifts it could have hoped for just before Congress adjourned for its year-end break: the repeal of the 2.3% medical device excise tax.
The tax was part of the Affordable Care Act of 2010 and was one of a number of funding mechanisms meant to help pay for the health reform. But the medtech industry argued that the tax limited jobs and innovation.
The tax on the sale of most medical technologies applied to medtech companies’ revenues, not profi ts. Device companies over the years achieved temporary suspensions of the tax through Congress — but never an outright repeal, until now.
It’s a huge win for the industry. The medtech industry directly accounts for well over 300,000 jobs in the United States, according to the U.S. Department of Commerce. More than 80% of medical device companies in the United States consist of fewer than 50 employees. If the tax was reactivated, it would lead to a loss of 21,390 full-time equivalent jobs and a reduction in of $1.7 billion in the gross domestic product, according to a recent Tax Foundation estimate.
With the specter of the tax lifted, medtech can concentrate on its continued growth. The global medical devices market size was valued at $425.5 billion in 2018 and is expected to reach $612.7 billion by 2025, according to a report released last month by Fortune Business Insights.
One clear spark for that growth is leadership, the theme of this month’s issue of Medical Design & Outsourcing. We profi le Miles White, 64, who will step down as CEO and chairman of Abbott in March after 21 years at the helm.
Abbott was a very different company when White took over in 1999, focusing more on pharmaceuticals than medical devices. White made some bold moves to change that focus, spinning off the company’s research-based pharmaceutical business in 2013 and acquiring St. Jude Medical four years later in one of the biggest deals in medtech history. Our profile offers insights into White’s achievements and leadership style.
Also featured this month, we talk with Nadim Yared, CEO of CVRx, which this year received FDA premarket approval for its Barostim Neo, the first neurostimulation device that can treat heart failure patients who are not indicated for cardiac resynchronization therapy. Yared, who recently served as chairman of the medical device trade group AdvaMed, shares the leadership philosophy that brought him to CVRx and reveals the traits he looks for in budding medtech leaders.
Finally, I’ve been writing and editing for Medical Design & Outsourcing since May 2018, and took over as managing editor in November. (Former managing editor Chris Newmarker moved up to executive editor of Life Sciences.) I look forward to interacting with many more of our readers and contributors, and to providing the news on the latest in medtech.
Medical Design & Outsourcing