Released on = April 16, 2007, 3:19 am

Press Release Author = Bharat Book Bureau

Industry = Marketing

Press Release Summary = Medical equipment accounts for a small but significant
proportion of total spending on healthcare in the UK. In 2002, total expenditure on
medical equipment and consumables was estimated at £2.49bn, having increased by 27%
since 1998 and by 32.2% since 1997 - the year the New Labour administration,
committed to increasing spending on the National Health Service (NHS), came to
power.

Press Release Body =
Medical Equipment - Market Report

Medical equipment accounts for a small but significant proportion of total spending
on healthcare in the UK. In 2002, total expenditure on medical equipment and
consumables was estimated at £2.49bn, having increased by 27% since 1998 and by
32.2% since 1997 - the year the New Labour administration, committed to increasing
spending on the National Health Service (NHS), came to power.

In recent years, the market has been growing, on average, at almost twice the rate
of inflation - a real growth rate of between 2% and 3% per annum. This probably
reflects the price inflation seen in the healthcare sector and the introduction of
more sophisticated (and more expensive) equipment, as well as greater spending on
healthcare by the Government and private citizens.

Technology has been the key driver in the medical equipment and consumables industry
- and indeed the entire healthcare sector - in recent years. Developments are taking
place at an astonishing pace. Products are becoming increasingly sophisticated, yet
simpler to use, as well as more flexible and more portable. These improvements,
along with advances in communications technology, mean that medical equipment and
consumables are increasingly being used outside their traditional settings: in the
patient\'s home or - with the advent of telemedicine - at remote locations, rather
than in a doctor\'s office or at the hospital.

In comparison with other industries, the medical-equipment market is relatively
stable and immune from the vagaries of the economic cycle, because spending on
healthcare tends to increase whatever the state of the economy. Governments are
always reluctant to cut back on healthcare spending, even in times of economic
hardship, because this is a politically sensitive issue. Equally, consumers
(understandably) only reduce spending on their health as a last resort - although
expenditure on private healthcare is undoubtedly influenced by the economic cycle.

The market is highly competitive - the global nature of the marketplace means that
UK suppliers must compete on a global basis. US, Japanese and German companies own a
significant number of medical-equipment manufacturers, and the industry is
characterised by a strong research and development (R&D) base: some companies invest
as much as 20% of their turnover in R&D. As a result, and because the industry
incorporates a broad range of different technologies and products, the
medical-equipment market is dynamic, innovative and responsive to change.

Although the market\'s annual growth rates are already strong, Key Note expects them
to rise over the next 5 years, fuelled by the Government\'s commitment to increase
spending on the NHS by historically large amounts. The market should benefit not
only from higher public spending on healthcare, but also from the increase in
private health insurance, supported by strong economic growth. In addition, the
ageing profile of the UK population will help to drive sales.



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