United States Medical Device Outsourcing Market By Service (Quality Assurance, Regulatory Affairs Services, Product Design and Development Services, Product Testing & Sterilization Services, Product Implementation Services, Product Upgrade Services, Product Maintenance Services, Contract Manufacturing), By Application (Cardiology, Diagnostic Imaging, Orthopedic, IVD, Ophthalmic, General and Plastic Surgery, Drug Delivery, Dental, Endoscopy, Diabetes Care, Others), By Class (Class I, Class II, Class III), By Region, Competition, Forecast & Opportunities, 2020-2030F

Market Overview

The United States Medical Device Outsourcing Market was valued at USD 31.06 Billion in 2024 and is expected to reach USD 64.68 Billion by 2030 with a CAGR of 12.98% through forecast period. The United States Medical Device Outsourcing Market is growing rapidly as medical device companies increasingly seek to outsource manufacturing and product development to specialized third-party providers. This shift is largely driven by the need to lower production costs while maintaining high-quality standards. Outsourcing provides companies with access to advanced technologies, expertise, and resources, enabling them to focus on their core competencies such as innovation and regulatory compliance. Additionally, companies benefit from economies of scale offered by outsourcing partners, which can reduce operational costs significantly. The increasing demand for medical devices, driven by an aging population and advancements in healthcare technologies, further fuels the growth of outsourcing services in the sector.

Several trends are shaping the market, with the demand for contract manufacturing services being particularly prominent. Companies are moving away from in-house production to rely on specialized outsourcing partners for manufacturing medical devices. These partnerships often provide flexibility in production volumes and faster time-to-market for new products. Moreover, the trend toward miniaturization and personalized medical devices has led to the demand for more advanced manufacturing techniques, such as additive manufacturing and precision engineering, that are available through outsourcing. Additionally, the increasing complexity of regulatory requirements for medical devices has prompted companies to partner with outsourcing firms that have the expertise to ensure compliance with local and international standards, thus reducing the risk of regulatory delays.

Despite its growth, the United States Medical Device Outsourcing Market faces several challenges. Regulatory hurdles remain a major concern, as strict standards and approval processes for medical devices can increase the complexity of outsourcing agreements. Companies must ensure that their outsourcing partners adhere to these regulations, which can vary across different regions. The rising pressure to cut costs while maintaining product quality also means that manufacturers need to closely monitor the performance and capabilities of outsourcing partners. There is also the challenge of intellectual property (IP) protection. Medical device manufacturers must be cautious in sharing proprietary designs and technologies with outsourcing partners to avoid IP theft or breaches. These factors, combined with supply chain vulnerabilities and a shortage of skilled labor in some areas, make it essential for companies to carefully choose their outsourcing partners to ensure smooth and efficient operations.

Key Market Drivers

Growing Demand for Advanced Medical Devices

​The growing demand for advanced medical devices significantly drives the United States Medical Device Outsourcing Market. As healthcare evolves, there's an increasing need for sophisticated devices that address complex medical conditions. Patients seek solutions offering better outcomes, quicker recovery, and enhanced comfort, leading to a demand for devices incorporating cutting-edge technologies such as robotics, minimally invasive procedures, and smart functionalities. This trend encourages medical device companies to innovate and expedite product development.​

To meet this demand, manufacturers are increasingly turning to outsourcing. Outsourcing allows companies to leverage specialized expertise and advanced manufacturing capabilities without heavy infrastructure investments. This strategy enables access to a range of services, from design and prototyping to testing, regulatory compliance, and large-scale production, thereby reducing time to market and managing costs effectively.​

The integration of advanced technologies into medical devices requires specialized knowledge and skilled personnel. For instance, the FDA has been actively involved in promoting medical device interoperability, aiming to enhance patient care and reduce errors through improved device connectivity. Additionally, the FDA's Digital Health Center of Excellence supports the advancement of digital health innovations, fostering responsible development of AI-enabled medical devices. These initiatives highlight the regulatory support driving innovation in medical devices.​

In 2020, U.S. manufacturing accounted for USD 2.3 trillion in value added, representing 12.0% of the GDP. This substantial manufacturing base supports the production of advanced medical devices, further bolstering the outsourcing market.​

The increasing demand for advanced medical devices, coupled with regulatory initiatives and a robust manufacturing sector, continues to drive the growth of the medical device outsourcing market in the United States.

Focus on Core Competencies

The United States Medical Device Outsourcing Market has experienced significant growth, driven by manufacturers’ increasing focus on their core competencies. Outsourcing non-core activities, such as manufacturing, regulatory support, and testing, allows medical device companies to streamline operations, improve efficiency, and reduce costs. By focusing on the development and design of innovative products, manufacturers can leverage specialized outsourcing partners to handle other aspects of the production process. This enables companies to remain competitive in an industry where the demand for high-quality, cost-effective medical devices is growing rapidly.

In 2019, the medical device industry in the U.S. accounted for 5.2% of the total healthcare expenditures, amounting to approximately USD 200 billion. This emphasizes the crucial role that medical devices play in the healthcare system, prompting manufacturers to adopt more strategic approaches to stay ahead. Outsourcing allows medical device companies to meet the increasing demand for high-quality products while maintaining a competitive edge. The ability to outsource components such as design verification, testing, and manufacturing helps companies mitigate risks, improve speed to market, and ensure compliance with stringent regulatory requirements.

This trend toward outsourcing enables manufacturers to keep up with evolving industry standards while allowing them to focus on product innovation, design, and customer engagement. The overall medical device outsourcing market is thus expected to grow steadily as companies increasingly partner with specialized service providers to maximize operational efficiency and improve their offerings. According to the U.S. Bureau of Economic Analysis, spending on medical devices continues to rise, indicating a robust demand for high-quality outsourced services to meet the evolving needs of the healthcare industry.

Advancements in Technology Integration

​Advancements in technology integration have significantly propelled the growth of the United States Medical Device Outsourcing Market. The adoption of cutting-edge technologies such as artificial intelligence (AI), machine learning, 3D printing, and automation has led to more efficient product development, manufacturing processes, and regulatory compliance.​

In 2023, the U.S. Food and Drug Administration (FDA) approved 221 AI and machine learning-enabled medical devices, marking a substantial increase from previous years. This surge highlights the growing incorporation of AI in medical devices, enhancing diagnostic accuracy and operational efficiency.​

The FDA's approval process has also seen an uptick in submissions, with 19,100 received in 2023, up from 18,800 in 2022. This increase reflects a dynamic and rapidly evolving medical device landscape, where technological advancements are continually being introduced. 

Employment within the medical device industry remains strong, supporting nearly 2 million jobs, both directly and indirectly. This workforce is essential in driving technological integration and maintaining the industry's competitive edge globally. ​

These statistics underscore the profound impact of technological advancements on the U.S. medical device outsourcing market, highlighting increased regulatory approvals, financial growth, and employment within the sector.

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Key Market Challenges

Stringent Regulatory Compliance

One of the significant challenges in the United States Medical Device Outsourcing Market is navigating stringent regulatory compliance. The U.S. Food and Drug Administration (FDA) imposes a rigorous set of rules and standards to ensure medical devices are safe, effective, and manufactured in accordance with Good Manufacturing Practices (GMP). Companies outsourcing medical device production must ensure that their third-party manufacturers comply with these regulations, which include extensive documentation, regular audits, and reporting requirements. Any deviations from these standards can lead to delays in product approval, recalls, or even severe penalties, making regulatory adherence a critical concern for companies in the market.

The FDA’s 21 CFR Part 820 regulation mandates detailed design controls, validation of manufacturing processes, and continuous quality monitoring throughout the production lifecycle. Compliance with these regulations often requires significant investments in quality control systems and staff training, which adds complexity and cost to the outsourcing process. In addition to FDA regulations, medical device companies must also comply with international regulations, such as those set by the European Medicines Agency (EMA) or other regional governing bodies, which may differ in their requirements.

The ever-evolving nature of regulatory frameworks further complicates matters, as companies must stay abreast of any updates or changes to avoid non-compliance. The regulatory burden often results in longer timelines for product development and a slower time to market, limiting the competitive edge of companies relying on outsourced production. Thus, maintaining compliance while managing outsourcing partnerships presents a persistent challenge for stakeholders in the U.S. medical device outsourcing industry.

Quality Control Issues

Quality control issues represent a significant challenge in the United States medical device outsourcing market. As medical devices become more complex and regulation-heavy, ensuring that products meet stringent quality standards becomes increasingly difficult. Outsourcing manufacturers are often located in regions with varying levels of regulatory compliance, leading to inconsistencies in product quality. The U.S. Food and Drug Administration (FDA) has established rigorous guidelines to ensure device safety and efficacy, but some outsourcing partners may not adhere to these standards due to differences in local regulatory environments or cost-cutting measures. This can result in deviations from expected product specifications, defects, or even device failures once they are in the market.

The increasing reliance on third-party manufacturers raises concerns about maintaining quality oversight. Medical device companies must establish robust monitoring systems to track quality metrics and ensure compliance with Good Manufacturing Practices (GMP). Lack of effective communication and insufficient oversight during production can lead to significant discrepancies in product quality. Additionally, outsourcing relationships can sometimes create challenges in accountability, with unclear responsibility for defects or failures. If issues with quality control arise, they can cause delays in product development, regulatory complications, costly recalls, and damage to a company’s reputation.

Ensuring comprehensive quality control across outsourced operations requires investment in training, quality audits, and proactive risk management strategies. Companies that fail to address quality concerns may face regulatory scrutiny, legal liabilities, and a loss of consumer trust, which can significantly harm their position in the competitive medical device market.

Key Market Trends

Increasing Demand for Non-Invasive Devices

​The United States medical device outsourcing market is experiencing significant growth, driven by the increasing demand for non-invasive devices. These devices, encompassing Class I and certain Class II products, are gaining popularity due to their ability to minimize patient discomfort and reduce recovery times compared to traditional invasive procedures. For instance, non-invasive cardiology devices, such as diagnostic imaging tools and wearable monitors, are in high demand as healthcare providers seek to offer less intrusive treatment options.

The shift towards non-invasive devices is prompting medical device manufacturers to outsource various functions, including design, production, and regulatory support, to specialized third-party providers. This approach allows original equipment manufacturers (OEMs) to focus on their core competencies while leveraging the expertise of outsourcing partners to meet the growing demand for advanced, non-invasive medical technologies. The outsourcing market is further bolstered by the need for compliance with stringent regulatory standards, such as ISO 13485, which emphasize risk management and quality assurance.

Technological advancements, including artificial intelligence, robotics, and additive manufacturing, are also playing a pivotal role in the development and production of non-invasive devices. These innovations enable the creation of more precise and effective medical devices, thereby enhancing patient outcomes and driving market growth. As healthcare providers continue to prioritize patient comfort and safety, the demand for non-invasive medical devices is expected to remain a key factor influencing the expansion of the U.S. medical device outsourcing market.​

Supply Chain Resilience Initiatives

​The U.S. medical device outsourcing market is undergoing significant transformation, driven by the growing demand for enhanced supply chain resilience. In recent years, supply chain vulnerabilities have been laid bare, particularly during disruptions such as the COVID-19 pandemic. To address these challenges, regulatory bodies like the FDA launched the Resilient Supply Chain Program (RSCP) in 2022, aiming to improve the visibility and robustness of medical device supply chains. This initiative focuses on monitoring risks, ensuring continuous device availability, and identifying vulnerabilities that could disrupt production and distribution.

The pandemic's impact has emphasized the risks associated with offshore manufacturing, especially in critical sectors like medical devices. As a result, many companies are rethinking their reliance on overseas production and exploring more diversified and resilient sourcing strategies. While reshoring some production to the U.S. is part of the strategy, many experts argue that it is not feasible to bring back all manufacturing. Instead, a hybrid approach that combines global supply chains with localized production for critical components is gaining traction.

Geopolitical tensions and shifting trade policies, such as tariffs on imports from countries like China and Mexico, have further complicated the landscape. These external pressures are pushing U.S. companies to reassess their supply chain models, looking for alternatives that reduce reliance on potentially volatile regions while ensuring cost-effectiveness.

The Biden administration has also recognized the need for supply chain resilience. In June 2024, President Biden signed an executive order aimed at improving the nation's supply chain infrastructure. The executive order directs the establishment of a White House council focused on reducing vulnerabilities and enhancing the competitiveness of U.S. industries. Through collaboration between industry leaders and government entities, the medical device sector aims to build stronger, more resilient supply chains that can withstand future disruptions and meet growing demand.

Segmental Insights

Application Insights

Based on the Application, Cardiology emerged as the dominant segment in the United States Medical Device Outsourcing Market in 2024. This is due to the increasing prevalence of cardiovascular diseases and the demand for advanced diagnostic and therapeutic devices. Cardiovascular diseases (CVDs) remain the leading cause of death in the U.S., driving the need for innovative medical devices such as pacemakers, stents, diagnostic imaging systems, and monitoring devices. With the growing aging population, the demand for cardiology-specific medical devices has expanded, resulting in higher outsourcing needs for design, manufacturing, testing, and regulatory compliance services. Medical device companies are increasingly turning to outsourcing partners to handle complex aspects of the development and manufacturing process, such as quality assurance, risk management, and regulatory compliance, particularly for devices intended for high-risk applications like cardiology. Outsourcing allows manufacturers to focus on their core competencies while ensuring adherence to stringent medical device standards set by regulatory bodies like the FDA.

Class Insights

Based on the Class, Class II emerged as the dominant segment in the United States Medical Device Outsourcing Market in 2024. This is due to their broad range of applications and regulatory requirements. These devices, which include products like infusion pumps, diagnostic imaging devices, and surgical instruments, are subject to moderate risk and require substantial regulatory oversight for approval. As such, manufacturers often rely on outsourcing partners to manage the development, testing, and compliance processes associated with these devices. The FDA mandates that Class II devices undergo premarket notification (510(k)) approval, ensuring they meet stringent safety and efficacy standards before they enter the market. This regulatory requirement increases the complexity of the development process, driving companies to outsource various stages, such as product design, manufacturing, testing, and quality assurance, to specialized service providers with the expertise to navigate these regulatory challenges.

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Regional Insights

The Mid-West region emerged as the dominant region in the United States Medical Device Outsourcing Market in 2024. This is due to its strong manufacturing infrastructure, skilled workforce, and strategic location. Several states in the Mid-West, such as Illinois, Ohio, and Michigan, have a long-standing presence in the medical device and manufacturing sectors. The region offers a competitive advantage with its established network of suppliers, service providers, and research institutions, making it an attractive location for medical device outsourcing. In addition, the region’s central position in the U.S. enables efficient distribution and logistics, allowing companies to access key markets across the country. The Mid-West also benefits from cost-effective labor and competitive operating costs, making it an appealing option for medical device manufacturers looking to reduce production expenses.

Recent Developments

• In March 2025, Flex Ltd. unveiled a new product introduction (NPI) center near Boston, designed to accelerate the development of medical devices and enhance support for healthcare clients. The center will streamline the entire product development process, from prototyping and preclinical builds to design verification and production transfer. This facility is expected to mitigate risks and expedite the commercialization of new medical devices.
• In February 2025, Jabil Inc. finalized the acquisition of Pharmaceutics International Inc. (Pii), a contract development and manufacturing organization (CDMO) specializing in aseptic filling, lyophilization, and oral solid dose manufacturing for early-stage, clinical, and commercial volumes. This acquisition strengthens their ability to offer pharmaceutical companies comprehensive, end-to-end support, enhancing the supply chain with a focus on quality and safety as healthcare innovation accelerates. Jabil’s expanded pharmaceutical solutions now include auto-injectors, pen injectors, inhalers, and on-body pumps, further bolstered by Pii’s expertise in scientific insights and manufacturing capabilities.
• In February 2025, Arterex, a leading global medical device developer and contract manufacturer, acquired Adroit USA Inc., a vertically integrated contract manufacturer specializing in complete medical device production. The company based in Pleasanton, California, Adroit USA operates two ISO 13485-certified manufacturing facilities in Bangalore, India, and an engineering applications development lab in Milpitas, California. The company specializes in high-precision injection-molded plastic components, stainless steel and nitinol parts, and fully assembled medical devices. Adroit USA's comprehensive "all under one roof" model provides tailored solutions for businesses of all sizes, from startups to large enterprises.
• In January 2025, Spectra Medical Devices (Spectra) and XL Precision Technologies (XLPT) unveiled their unified brand, Elevaris Medical Devices. This new contract development and manufacturing organization (CDMO) combines a legacy of excellence with advanced capabilities in precision medical device development and manufacturing. The merger followed Spectra’s acquisition of XLPT in September 2024, facilitated by healthcare investor QHP Capital. The integration of Spectra’s engineering and manufacturing expertise with XLPT’s specialization in precision micro-components, complex tubular components, and sub-assemblies strengthens their ability to serve both large OEMs and startups in the medical device industry.
• In November 2024, MDC (Medical Device Components), a leading provider of high-precision medical device components, announced the acquisition of Lighteum, a pioneer in nitinol-based medical component manufacturing. The deal merges MDC's expertise in platinum group metals and micromachining with Lighteum's advanced nitinol processing capabilities, including laser cutting, welding, heat shaping, and electropolishing. This acquisition enhances MDC’s portfolio and strengthens its ability to meet the growing demands of the medical device industry.
• In September 2024, Eurofins Scientific acquired Infinity Laboratories, Inc., expanding its capabilities in biopharma product testing in the U.S. This acquisition strengthens Eurofins' position in the growing market for outsourced testing services, addressing the rising demand for sterility, biocompatibility, and quality assurance testing for medical devices.

Key Market Players

• Laboratory Corporation of America Holdings
• Pace Analytical Services, Inc.
• Intertek Group plc
• Charles River Laboratories
• PAREXEL International Corporation
• Accell Clinical Research, LLC
• Criterium, Inc.
• ICON plc.
• IQVIA Inc.
• Integer Holdings Corporation

Report Scope:

In this report, the United States Medical Device Outsourcing Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

• United States Medical Device Outsourcing Market, By Service:

o   Quality Assurance

o   Regulatory Affairs Services

o   Product Design and Development Services

o   Product Testing & Sterilization Services

o   Product Implementation Services

o   Product Upgrade Services

o   Product Maintenance Services

o   Contract Manufacturing

• United States Medical Device Outsourcing Market, By Application:

o   Cardiology

o   Diagnostic Imaging

o   Orthopedic

o   IVD

o   Ophthalmic

o   General and Plastic Surgery

o   Drug Delivery

o   Dental

o   Endoscopy

o   Diabetes Care

o   Others

• United States Medical Device Outsourcing Market, By Class:

o   Class I

o   Class II

o   Class III

• United States Medical Device Outsourcing Market, By Region:

o   North-East

o   Mid-West

o   West

o   South

Competitive Landscape

Company Profiles: Detailed analysis of the major companies present in the United States Medical Device Outsourcing Market.

Available Customizations:

United States Medical Device Outsourcing Market report with the given market data, TechSci Research offers customizations according to a company's specific needs. The following customization options are available for the report:

Company Information

• Detailed analysis and profiling of additional market players (up to five).

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