As of April 25, 2025, the U.S. has imposed tariffs on over 180 countries and territories. This includes a universal 10% baseline tariff while larger tariffs are in a 90-day “pause” period. The tariffs may impact many industries, including medical devices. For example, according to GlobalData, 69% of U.S.-marketed devices are manufactured solely outside of the U.S. Further, some individual regions and countries face steeper rates. The U.S. imposed a 20% tariff rate on the European Union. The U.S. and China have raised tariffs on each other, with the U.S. raising tariffs on Chinese imports to 145% and China putting duties of 125% on U.S. goods. According to some estimates, nearly 14% of U.S.-marketed medical devices are manufactured in China.
Electronic medical devices may also be impacted by semiconductor tariffs. According to some reports, over half of all medical devices depend on semiconductors to operate and over 90% of the world’s most advanced chips are manufactured in Taiwan. Taiwan had a 32% tariff applied on all goods exported to the U.S.
What will be the impact of the tariffs on the medical device industry? Some analysts see increased costs and prices. For example, one analyst predicts: “If Trump’s tariffs impact semiconductor imports, companies can expect an increase in cost when sourcing semiconductors and chipsets for medical devices, even if final assembly occurs in the US. These price increases are likely to be passed on to consumers and healthcare systems.”
More generally, consultants at PwC and Boston Consulting Group state that medical device manufacturers are already looking to switch production to lower-tariff countries. Johnson & Johnson anticipates a $400 million tariff “headwind” on its medical tech division. Belluscara, a British medical device maker, forecasts that its products sold in the U.S. face tariffs up to 20% and are evaluating how to cut costs in the long term.
Others see potential benefits from the tariffs to the medical device industry. For example, MSN reports that “U.S. makers of personal protection equipment are applauding the new tariffs on Chinese goods, hoping they will help level the playing field here at home.” It is reported that Altor Safety, manufacturer of masks, N95 respirators and gloves in the U.S., has “welcomed the tariffs on China.” The PPE maker sees potential gains from the tariffs due to competing Chinese manufacturers with low prices due to government subsidies.
What will be the impact on medical technology investment? According to some reports, the tariffs may “disrupt supply chains by creating uncertainty and delays, especially if other countries retaliate. This could again discourage long-term investments in medtech.” Further, some analysts warn that tariffs pose a serious scale risk to start up medical technology firms or smaller to mid-size original equipment manufacturers.
Some see potential benefits to medtech investment. One analyst predicts that tariffs targeting foreign-made devices may actually attract venture capital interest in American production facilities and companies offering domestic alternatives. One report states that, if government incentives such as tax credits, grants, or development funding follow tariffs as part of a broader medical device industrial policy, then “investors could see opportunities in early-stage U.S. medtech manufacturing and companies aligned with reshoring efforts.” Analysts also predict that supply chain disruptions and increased costs on electronic or battery-powered devices such as wearables manufactured in Asia may increase investor preferences for medical technology centered on software and U.S. assembly.
Tags
Medical Devices, Tariffs, venture capital
