Wearable Medical Devices: Future Growth Drivers and Market Leaders

Current Market Trends

Current market trends in wearable medical devices show significant growth potential in underpenetrated markets like Japan, increased accessibility through financing solutions, global market expansion, and strong market share in specific segments, driven by clinical and economic benefits.

"Japan is a market that has over a 1000000 folks reimbursed for CGM and currently one of the lowest penetration markets in the world." --- (DXCM, conference, 2024/06/05)

"We've introduced several financing solutions from installment plans to trading programs that reduce the affordability threshold and therefore, customers tend to buy -- want to buy at the top of the range that is very valuable for us in developed markets, but particularly in emerging markets where the affordability issues are more pronounced." --- (AAPL, earning call, 2024/Q2)

"It's difficult to kind of forecast it, but what I have said is on previous calls and on some of my prepared remarks that I think you're going to see this just this build that will be occurring globally in the market as the data proves and shows the clinical medical and health economic benefit by reimbursing for this patient population." --- (ABT, earning call, 2024/Q1)

"This is in our core U. S. Market, but we also have a lot of international markets that we're moving in as well." --- (DXCM, conference, 2024/06/05)

"It's done very well. From a single chamber perspective, I think we are now at about 50 share of the US market." --- (ABT, earning call, 2024/Q1)

Regulatory Environment Impact

The challenging regulatory environment is impacting the wearable medical devices market, but companies like JNJ and DXCM are navigating it effectively. JNJ is achieving significant regulatory milestones, while DXCM benefits from expanded coverage, indicating that despite challenges, regulatory advancements are fostering growth.

"Just wanted to ask you in this sort of more challenging regulatory environment, what gives you confidence in a mid-twenty 20 foreclose for the deal?" --- (JNJ, M&A Announcement, 2024/04/05)

"4th, we closed the Seidgen acquisition, which demonstrates our ability to interact effectively with regulators around the world even in the current challenging environment. We believe that this acquisition marks the beginning of a new chapter in our oncology story and our fight against cancer." --- (PFE, AGM, 2024/04/25)

"National Protectionists believe in reshaping & redirecting the regulatory state to advance policies that improve the plight of American workers and manufacturers." --- (DXCM, Twitter, 2024/07/11)

"We have strong momentum with key end-market products and continue to advance our pipeline with significant clinical and regulatory milestones being attained. Our MedTech business delivered growth that fell below our expectations of growing in the upper range of our markets, which as you recall correlates to a weighted-average market growth rate of 5% to 7% from 2022 through 2027." --- (JNJ, earning call, 2024/Q2)

"We have attracted tens of thousands of new prescribers to our ecosystem, meaningfully improved our presence within primary care, and experienced growing demand from people with diabetes who are benefiting from significant expansions in coverage over the last year." --- (DXCM, earning call, 2024/Q1)

Key Applications Driving Growth

Key applications driving growth in wearable medical devices include structural heart devices like TAVR, LAA, and tricuspid repair, which are seeing increased adoption and market share. Additionally, safety remains a crucial driver, underscoring the importance of reliable and secure wearable medical technologies.

"In structural heart, growth of more than 15% reflects an acceleration in growth compared to the first quarter and was led by several recently launched products that are driving new adoption and share capture in attractive high growth areas, including TAVR, LAA, and tricuspid repair. This quarter, we" --- (ABT, earning call, 2024/Q2)

"I guess my view here is that, I believe that, probably safety is a key driver here, just to start off with." --- (ABT, earning call, 2024/Q1)

Competitive Landscape

Apple acknowledges the highly competitive nature of the wearable medical devices market, emphasizing the intense competition and evolving consumer demand for new devices.

"And if that's the case and maybe this is for Tim obviously, how are you thinking about the competitive landscape in the context of what you just said maybe outside of China and what changes sort of, the consumer demand or receptivity to new devices because we've been in this malaise for a while." --- (AAPL, earning call, 2024/Q2)

"Tim Cook: Well, certainly, the competitive environment there is the most competitive in the world." --- (AAPL, earning call, 2024/Q3)

Market Leaders

Abbott, Dexcom, and Apple are leading the wearable medical devices market. Abbott focuses on internal appreciation and emerging market opportunities. Dexcom is excited about international growth and serving diverse markets. Apple strategizes capital deployment to spur demand, maintaining its leadership.

"it affords them, so I think this is a great opportunity for us. It might be under-appreciated with the market, but it is definitely appreciated amongst me and the device team and the CRM team, and we’re working hard to get to that point where you can really let it go strong." --- (ABT, earning call, 2024/Q2)

"So we're really excited about the international market opportunities ahead of us." --- (DXCM, conference, 2024/06/05)

"And, you know, given you're struggling to reduce your net -- your -- reach your net neutral cash position and your margins are sort of near highs, do you see ways to deploy capital more to spur replacement demand in your installed base either with greater device financing, more investment in marketing, more promotions." --- (AAPL, earning call, 2024/Q2)

"With our extensive presence in emerging markets, we have a unique opportunity to scale a licensing model that is capital efficient and can bring access to these life-changing medicines to millions of people in emerging markets." --- (ABT, earning call, 2024/Q2)

"So it's an opportunity to serve both tender markets as well as high end markets." --- (DXCM, conference, 2024/06/05)

Future Growth Drivers

The future growth drivers for wearable medical devices include the expansion of Apple's installed base and ecosystem, which sets a strong foundation for future growth, and Abbott's new product pipeline, which sustains top-tier growth in health tech. Increased customer engagement also bolsters these growth prospects.

"We continue to have great momentum in services, as the growth of our installed base of active devices, sets a strong foundation for the future expansion of our ecosystem." --- (AAPL, earning call, 2024/Q3)

"Our new product pipeline is helping us sustain top-tier growth as we create the future of health tech." --- (ABT, Twitter, 2024/07/18)

"This provides a strong foundation for the future growth of the services business as we continued to see increased customer engagement with our ecosystem." --- (AAPL, earning call, 2024/Q2)

Challenges and Risks

Wearable medical device companies face significant challenges and risks, including addressing market obstacles, financial market conditions affecting capital access, cost containment efforts, competitive pressures, and specific risk models related to patient outcomes.

"So these are -- putting these things, some of these questions, risks or obstacles behind us is also, I think, another one." --- (MDT, earning call, 2024/Q4)

"The general condition of the financial markets and the economy may increase those risks and may affect the value and liquidity of investments and restrict our ability to access the capital markets." --- (DXCM, sec filing, 2024/Q1)

"I do think we benefit from the global nature of our business. While there are pockets cost containment efforts that we're managing, like VBP in China, we see tremendous opportunity to really secure a premium pricing, especially where we have differentiated innovation. And especially now that we're entering or are entering is like cardiovascular of significant unmet need, there is tremendous opportunities for us to ensure that we secure premium pricing for truly differentiated innovations, especially in areas like electrophysiology, in heart recovery with Abiomed, and more recently with Shockwave. Thank you." --- (JNJ, earning call, 2024/Q2)

"I was hoping you could just help or share your thoughts on the share gain opportunity in integrated pump segment of CGM market versus the share loss risk in the Type 2 non-insulin cash pace segment with a competitive launch share early in 2024. I just have one follow up." --- (ABT, earning call, 2024/Q1)

"It's a risk decision model that the smaller the aniline, the higher the risk for patient prosthesis mismatch. And we know for whatever that annual size is that we have a mark reduction, you know, large reduction in the risk of PPM if you use an evolute compared to a sapient." --- (MDT, event transcript, 2024/04/07)