Executive Summary

In 1996, the UK medical equipment and consumable product market was worth £2.03bn, having grown by 9.6% from 1995. This made the UK the third largest market in Europe, behind Germany and France. The market is forecast to reach £3.3bn by the year 2001. Hospital supplies are divided into five main groupings, these being medical equipment, medical consumable products, non-medical equipment, pharmaceutical products, and non-medical consumable products. This report focuses on the first two of these groupings.

The largest purchaser of medical equipment and consumable products in the UK is the National Health Service (NHS), via the NHS trust hospitals and the National Health Service Supplies Authority (NHSSA). The other purchasers are the independent acute-care hospital and nursing and residential home sectors.

There are an estimated 2,745 organisations producing medical equipment, electromedical equipment and orthopaedic appliances. The market is highly concentrated, with the majority of sales being the ten largest manufacturers. The market appears fragmented due to the sheer profusion of medical equipment manufacturers. However, most of these are small companies with correspondingly small market shares. Of all medical instrument and orthopaedic appliance manufacturers, 58.7% have annual revenues of less than £500,000, and 26.5% have revenues of less than £100,000. Exports rose steadily between 1992 and 1993, and levelled out in 1994, before rising again. Exports for medical instruments and orthopaedic appliances increased by 22.3% between 1993 and 1995. Over the same period, however, exports for electromedical instrumentation dropped by 3.7%, reflecting strong competition from the US and Germany.

The uncertain state of the economy has led to rationalisation and budget restrictions. However, the increasing market awareness of the NHS is creating opportunities for manufacturers. In addition, the increasing efficiency of acute-care, with the rising trends for day surgery and shorter patient stay, is increasing throughput of patients. This will lead to increased use and consumption of medical supplies, particularly disposables. Regardless of the short-term uncertainty caused by the coming General Election, and Government policy, the demographics of an ageing population will ensure long-term growth in the usage of medical equipment.

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