Private Equity Investments Fuel Innovative Medical Devices that Improve Lives

The American Investment Council (AIC) is launching a new series highlighting how private equity plays a critical role in supporting quality, affordable health care in the United States. Today, the AIC is spotlighting how private equity investments help bring innovative medical devices to market that improve lives.

Fueling 870 Medical Device Manufacturers

Over the past decade, more than 870 medical manufacturers partnered with private equity to grow their footprints, innovate new products, hire industry experts, and ultimately distribute these devices to the providers and patients who need them.

Delivering $125 Billion

Private equity has invested more than $125 billion into medical device manufacturers over the past decade. Medical device and life sciences manufacturers must spend $54 million on average in R&D and testing costs to bring a novel complex medical device to market. When failed devices and studies are taken into account, these costs rise to $522 million.

Without these private equity investments, many medical device manufacturers could not provide life-changing devices to patients, which leads to more successful surgeries and shorter, less painful recovery times.

Medical Manufacturing Spotlight: Plymouth, Minnesota

Ev3, a medical device manufacturer based in Plymouth, Minnesota, partnered with AIC member Warburg Pincus, health care specialist The Vertical Group, and Dale Spencer, a veteran of the medical device industry. Ev3 quickly became an important player in the manufacturing market of stents, catheters, and other specialized medical devices. After ev3 went public and was acquired for $2.6 billion, its headcount had grown to 1,350 employees thanks to private equity sponsorship.

Our full report on how private equity complements and strengthens the health care industry can be found here.

Tune back in over the coming weeks to see how private investment serves as a critical source of capital for hospital systems, outpatient clinics, pharmaceutical manufacturers, and other lifesaving initiatives.