Having witnessed the decline in many segments of the domestic manufacturing industry, many manufacturers and services providers who have traditionally not focused on the healthcare and medical technology sectors are currently looking into these markets as their next major areas for growth, according to Frost & Sullivan which recently completed a white paper on the topic “Looking at the Healthcare Industry for Growth Opportunities: What New Entrants to the Market Need to Know.”
“The prospects of healthcare reform and billions of dollars in stimulus funding already allocated to healthcare have drawn new competitors to the market,” says the research firm, adding that major companies such as Google, Intel, Delphi, Microsoft, Wal-Mart, Procter & Gamble, and others have targeted healthcare as a critical sector for future expansion.
Such 'non-traditional' companies include materials, component and OEM manufacturers, finished goods manufacturers in non-healthcare sectors, information technology companies, contract manufacturers, consumer goods companies, and distributors and retailers, among others.
"In most cases, these companies see an ability to leverage their strengths to tap into a market with strong fundamentals – an aging population, consistent growth and the ability to reward innovation," explains Charlie Whelan, Director of Healthcare Consulting for Frost & Sullivan. "While the ultimate fate of healthcare reform is still to be determined, it will likely result in the expansion of healthcare services to millions of new consumers of medical goods and services."
While the healthcare industry has many attractive features, non-traditional companies must conduct a careful assessment of their opportunities before making significant investments in this complex market. The healthcare industry is intensely regulated, litigious, and heavily controlled by insurance reimbursement guidelines. Distribution and purchasing pathways are also complex, but the diversity of the healthcare and medical technology marketplace creates opportunity.
"Companies with a fresh, outside perspective will be invaluable to improving healthcare delivery and producing the next generation of medical technology," adds Whelan. "The enormous demand for new technology and solutions to address both the clinical needs of patients and the systemic problems of healthcare delivery will create opportunities for companies with the foresight to identify and capitalize on opportunities."