Is 2023 A Good Time To Sell My Medical Device Manufacturer In California
2023 is the year to make your move and sell/exit- especially if you’re a medical device manufacturing company with quality products that are solving market issues. With plenty of competitive buyers on board, it’s set to be an epic battle for innovation supremacy! Strategize wisely and let the games begin…
Medical Device Manufacturers’ Revenue:
- Surgical & Medical Instruments(30.0%)
- Surgical & Medical Supplies(30.0%)
- Surgical & Medical Equipment(9.0%)
- Artificial Limbs & Joints (5.0%)
- Instrument & Equipment Parts(4.0%)
- Orthopedic & Prosthetic Appliances (4.0%)
- Other (18.0%)
Nonetheless, there are many other medical devices integrated with digital health technology (especially artificial intelligence machine learning) that is also popular in California.
The total number of medical device manufacturing companies in the US is 8,900; California accounts for 44 percent of the total established operating medical device manufacturers in the US estimated at 3,922 businesses according to Dun & Bradstreet.
US & California Medical Device Manufacturing Landscape
A typical medical device manufacturer generates $10 million in annual revenue and has about 35-36 employees.
- The overall medical device manufacturing industry consists of about 8,900 companies with $92 billion in sales and 320,000 employees.
- The two largest segments of the industry, are surgical and medical instruments, and surgical appliances and supplies, consisting of about 2,700 companies with over $75 billion in sales and 245,000 employees. These segments are the primary focus of this profile.
- The states with the highest number of medical device companies include California (44% of the total), Florida (23%), New York (1.7%), Texas (17%), Illinois (10%), Indiana (5%), Pennsylvania (11%), Ohio (9%), and Minnesota (8%).
- Major US medical device companies include Medtronic, GE Healthcare Technologies, Johnson & Johnson, Boston Scientific, Baxter, Becton Dickinson, Beckman Coulter, Abbott Labs, and Stryker Corporation.
Source – Virtual IQ | NAICS: 339112, 339113 SIC: 3841, 3842
In California, as in the US, an increasing share of medical device manufacturers are owned by small and medium-sized companies accounting for 60 percent.
A recent study showed that the share of medical device manufacturers owned by:
- female entrepreneurs are 12%
- followed by 9.9% veteran owned
- and finally, 7% are owned by minorities.
Forty percent are classified under a corporate entity.
Medical Device Manufacturers are Blossoming with Growing Investments
Medical devices M&A remains historically strong in 2022, staying up to date with the industry’s record-breaking investments.
While totals in the healthcare industry have decreased since 2021’s highs, they are still holding steady compared to levels before then. Whether this trend continues into 2023 is yet unknown; several varying factors—from supply chain issues and inflation to geopolitical unrest—could influence outcomes going forward. Yet, Rogerson Business Sevices remain cautiously optimistic that medical devices M&A will stay relatively robust throughout the year ahead!
The market for the medical device manufacturing sector is bullish in California despite a recent article by Fierce Healthcare stating that Pitchbook claims deals are slowing down in the healthcare services industry.
“After a record-breaking 2021, private equity deals in healthcare achieved an impressive runner-up spot with 863 total deals announced or closed by the end of 2022.”
The article continued enforcing the slowdown in deals stating: “although Q4 saw fewer transactions than prior quarters, overall this was still one of the most successful years to date for PE activity within health care and demonstrates that investors remain bullish on opportunities provided through synergistic stake acquisitions in this industry sector.”
“We are seeing things slow down relative to where we were coming off of an unprecedented level of deal activity in 2021,” PitchBook’s senior healthcare analyst Rebecca Springer told Fierce Healthcare.
Needless to say, 2023 is primed to be an exciting year for medical device manufacturing companies in M&A activity – fueled by the two market drivers of industry consolidation and a healthy cash reserve.
California just closed 4 acquisitions in January & February 2023.
| Announced Date | Acquirer Name | Transaction Name | Price |
| Jan 17, 2023 | Shockwave Medical | Neovasc acquired by Shockwave Medical | $147M |
| Jan 5, 2023 | Life Science Outsourcing | J-Pac Medical was acquired by Life Science Outsourcing | — |
| Jan 9, 2023 | Ra Medical Systems | Catheter Robotics acquired by Ra Medical Systems | — |
| Feb 13, 2023 | Cytek Biosciences | Luminex – Flow Cytometry & Imaging acquired by Cytek Biosciences | — |
Source: Crunchbase
The current economic landscape provides many opportunities ripe for investment, while larger firms are looking to leverage those gains through strategic acquisition. It’s no wonder experts predict that Mergers and Acquisitions in the MedTech and Medical Devices Sector will remain strong this year! California also created special incentive programs supporting the manufacturing industry.
When it comes to the medical device manufacturing industry, three key trends can’t be overlooked. To navigate these positive vibes successfully, let’s explore what each of these entails.
Benefits of Industry Consolidation
When efforts to innovate and develop new medical products become logistically overwhelming or financially risky, small device firms can seek out larger partners as a strategic solution.
Merging with established companies gives smaller businesses access to the expertise and resources they need while providing their bigger counterparts entry into cutting-edge technology – enabling both parties to remain competitive in continually evolving markets!
Aging Population Driving High Demand
With the US population aging and healthcare costs on the rise, medical device companies face an exciting challenge.
Home health care is leading growth in this industry as more patients receive care outside of traditional hospital settings. This shift has sparked a demand for high-tech products designed to be used by even unskilled workers or directly administered by patients themselves – think pacemakers and defibrillators!
As demographics continue to evolve so too will opportunities in advanced medical technology; both creatively solving complex issues while containing costs at the same time.
Growth In Minimally Invasive Procedures
Surgeries uplifted by modern technology are bringing about a new era in patient care, featuring minimally invasive endoscopic procedures.
Much less traumatic than traditional open surgeries and accompanied by reduced post-operative pain, fewer complications such as infections, and quicker recovery periods – all rounds of applause for the rise of these medical advancements!
To take advantage without breaking their bank accounts hospitals turn to fixed fee per-use leasing systems on sophisticated optical lenses that outfit these versatile instruments.
Quite frankly we’re living in an age where state-of-the-art healthcare access is no longer out of reach; aside from achieving better outcomes, it’s also translating into significant cost savings! See these manufacturing success stories.
Rogerson Business Services have been brokering manufacturing companies since 2006 in California. We have sold many manufacturing-related businesses in various niches and sectors. Most recently, we sold a $36 million manufacturing company deal in 2021.
Send us an email to support@rogersonbusinessservices.com and get the full list of manufacturers sold.
Let’s dig deeper to understand more the certain factors that can influence this market environment.
Let’s go…
5 Buy-Sell Medical Device Manufacturers’ Outlook in 2023
First Outlook: Interest Rates
With the medical devices manufacturing industry poised to become a hot investment prospect in 2023, now could be the ideal time for strategic buyers and acquirers alike.
Experience higher interest rates due to recent Fed action ensuring long-term high rate elevation – leading to strong returns for investors an attractive recession-proof option offering high security on funds invested within this sector.
Looking at current market conditions it’s evident that selling your California-based manufacturing business now is arguably the most opportune economic event; putting you firmly in the driving seat of lucrative financial gain!
Second Outlook: Strategic Buyers
California serves as a beacon for medical device manufacturers, drawing in prospective buyers and investors looking to capitalize on the market’s impressive range of products.
From tongue depressors and bandages to programmable pacemakers or sophisticated imaging systems – businesses seeking strategic investments have an array of options from which they can choose that cater perfectly to their goals.
This dynamic landscape offers unrestricted possibility amidst a wide selection of surgical appliances, instruments & supplies, electro-medical equipment (pacemakers, etc.), diagnostic substances (lab-related goods), irradiation apparatus (X-Ray, etc.) dental products to ophthalmic goods; so comes witness why the following medical or biomedical devices manufacturing niche is at the top everyone’s bucket list!
- Surgical & Medical Instruments
- Surgical & Medical Supplies
- Surgical & Medical Equipment
- Artificial Limbs & Joints
- Instrument & Equipment Parts
- Orthopedic & Prosthetic Appliances
Among many trending new devices in the healthcare industry continue to evolve, there is an increased demand for single-use disposable medical instruments and devices.
Reusable products are becoming a thing of the past as more organizations recognize that this cost-effective solution allows them to avoid costly infrastructure investments such as cleaning, repairing, and sterilizing reusable materials while simultaneously reducing any risks associated with ineffective sterilization or potential contamination from reused equipment.
Boomer business owners are passing the torch to a new generation of savvy investors, creating an unprecedented chance for strategic buyers to capitalize on the medical device industry.
With demand remaining strong and ever-expanding despite recessions — entrepreneurs have a golden opportunity like never before!
Third Outlook: Availability of Dry Powder (Cash For Investment Availability)
As we look into the future, professionally managed medical device manufacturing companies remain highly desirable M&A targets.
This is evidenced by a massive amount of cash held in S&P 500 entities and private equity funds seeking to invest in these established businesses over the next 12 months – totaling nearly $3.7 trillion! With such impressive numbers at their disposal, mom-and-pop shop owners should rest assured that their business will certainly garner attention from potential buyers as they prepare it for sale down the line according to Preqin.
Fourth Outlook: Capital Gains Tax
Californians are savvy when it comes to capital gains taxes, but even the great Warren Buffet needs a helping hand.
Thanks to some tax relief this year though, state taxpayers can continue counting their blessings and working on those investment portfolios without any extra stress from Biden’s proposed hikes in 2021/2022!
Fifth Outlook: Timing The Medical Device Manufacturer Sale
As a medical device manufacturer in California, you’ll have to decide whether you want maximum bang for your buck – wait until 2028 when the market is at its peak, or seize on growth opportunities sooner by preparing now.
Get it right and the timing could be everything; with just some effective strategizing this current cycle can prove incredibly lucrative! Retirement-age entrepreneurs should weigh their options carefully as the next 5-10 years promise both potential reward and risk.
A certified business broker specializing in the health and medical device manufacturing industry can help evaluate which goal fits best with your business’s vision before setting off into uncharted waters!
Rogerson Business Services has defied expectations and is thriving in the buy-sell market, with last year achieving a record high.
This success looks set to be outdone by 2022 as several factors have kept growth on an impressive trajectory – ensuring that 2023 will continue this trend of excellence!
2023 Will Be an Even Better Year to Sell Your Medical Device Manufacturer in California if the Timing is Right. Why?
With the old guard of business owners beginning to retire, Rogerson Business Services is expecting a bustling buy-sell landscape in 2023 with generous cash flow multiples for those looking to exit.
What’s more, Warren Buffett agrees that now could be an opportune time for transitioning owners planning their exit from the market as businesses performed better financially by the end of 2022.
The medical device manufacturing industry in California looks positioned particularly well and likely poised to provide great rewards – both financial and personal –for all involved parties!
A special shoutout goes out to retiring business owners who can look forward to an efficient deal process that will aptly reward them after years of hard work dedicated to forging success stories!
Selling Your Medical Device Business In 2023
Selling your manufacturing business doesn’t have to be a hair-pulling endeavor. With assistance from Rogerson Business Services, you can trust that our expert advisors will make sure your transaction is handled quickly and safely for both parties – allowing you to benefit just like how California’s manufacturing business did with its $36 million sale in 2021!
Let us help guide the way so that together we can ensure this journey runs as smoothly as possible. Contact us today and explore what opportunities await on the horizon of 2023!
Positioning Your Business To Capture The Best ROI
When it comes to selling your medical device manufacturing business, trust Rogerson Business Services’ expertise for successful planning and execution.
Our team has helped many manufacturing owners maximize their return investments over the last two years alone – never settling for anything less than getting full value from a sale! As Warren Buffett put it: “Price is what you pay; Value is what you get.”
Working together with RBS will ensure that no detail of your holistic approach goes overlooked during this exciting journey.
As always, Rogerson Business Services (RBS) thank you for reading and stand ready to assist you in whatever challenge you are facing. As you will see, we are very bullish on the 2023 buy-sell medical devices manufacturing trading landscape…
Next
In a rapidly-changing market, business owners in 2023 are looking to unlock potential profits by investing carefully.
Joining them on the path toward success is an experienced and certified mergers & acquisitions advisor here in California who can help manufacturers of medical devices maximize their opportunities!
From determining values and creating attractive packages for buyers (all while protecting confidentiality) to forming reliable deal teams – with this trusted certified manufacturing business broker in California paving the way, achieving peak returns has become far more straightforward than Warren Buffett himself could have imagined!
Articles and Videos Worth Checking Out
1) 2023 Market Policy and Outlook
2) Baby Boomers Infrastructure & 2023 Outlook
4) Medical Device Manufacturers Association (MDMA)
5) Qmed.com
Are You Ready To Sell Your Medical Device Manufacturing Company?
Rogerson Business Services (RBS) is a certified business brokerage firm specializing in selling manufacturing businesses in California. RBS created a comprehensive summary with every step of the selling process explaining the steps of the selling process, including what you can expect in establishing the proper price and valuation for your medical devices manufacturing business.
