UNITED KINGDOM - UK Medical Device Industry and Demographic Data

Shown below you will find some basic demographic and economic data for the United Kingdom (UK), plus information specific to the medical device and healthcare industry.

Capital city: London

Total area: 242500 km²

Population of the UK: 62.6 million

Currency: Pound sterling

Language: English

Structure of UK population:
0-14 years: 17%
15-64 years: 66%
65 years and over: 17% (2011 est.)

Life expectancy at birth:
Male: 78 years
Female: 82 years

Healthcare expenditures total (% of GDP): 9.8%

Healthcare expenditures per capita: $3440 (USD)

Expenditures on healthcare:
Government: 84%*
Private: 16%**

Number of UK hospitals: 2312 (2007)

Healthcare financing on the UK: In England, NHS hospitals are reimbursed for their inpatient and outpatient services on the base of a case mix system, the so-called "Payment by Results", a fixed price (national tariff) is paid for each individual case treated. The tariffs are applied at DRG level. In Northern Ireland, Scotland and Wales, NHS hospitals receive an annual ex-ante fixed budget which is used to fund all their services. General practitioners are self employed. Since 2004 the remuneration of their services has been based on the combination of capitation and quality points.

United Kingdom medical device industry: The UK medical device market is valued at $9.9 billion in 2008 and thus placing this market as the third largest in Europe behind Germany and France. The medical device trade is import-led; import $7.4 billion (2006), export $6.9 billion (2006). The UK has a very open and transparent medical device market. The language makes it also an easier country to approach then other European countries. The market is characterized by a large number of small scale medical device manufacturers. There are also few world players with R&D based in the UK (Smith & Nephew, J&J, GE Healthcare); and world players that have activity in the UK (Medtronic, Smiths Industries, etc.). In 2005 there were approximately 2000 medical manufacturers. The strength of UK manufacturers lies especially in orthopedics but also in imaging, diagnostics, and innovative interdisciplinary devices. Disposable medical devices are preferred above reusable devices due to high awareness of hygiene in the hospitals. They prefer disposable products to avoid cross-contamination.

Opportunity for importers: low elasticity of domestic suppliers to respond to changing demand. Threat for importers: The NHS, the biggest consumer of medical devices, places barriers that might make it difficult for small companies to access the procurement rules, large scale requirements and pricing policy. In addition NHS hospitals are slow in adapting innovative medical technology.

* Government expenditures include all spending on healthcare passed through governmental agencies regardless of the funding source. Source: World Health Organization global health expenditure database. 2010 data.
** Private healthcare expenditures include private medical insurance, direct out-of-pocket payments by the consumer and other non-governmental sources. Source: World Health Organization global health expenditure database. 2010 data.