The World Health Organization defines a medi- cal device as an “article, instrument, apparatus or machine used in the prevention, diagnosis or treatment of illness or disease, or for detecting, measuring, restoring, correcting or modifying the structure or function of the body for some health purpose. Typically, the purpose of a medi- cal device is not achieved by pharmacological, immunological or metabolic means.”1 The pri- mary customers for medical device firms are physicians or hospitals (acting on behalf of phy- sicians). These firms typically receive payments directly from insurance companies.
The Food and Drug Administration (FDA) divides the types of medical devices into
medical specialty panels. These include ortho- pedic instruments, surgical instruments, diag- nostic apparatus, stents and catheters, syringes and hypodermic needles, blood transfusion and IV equipment, and others. The American medi- cal device industry represents almost half of the sales world-wide. The industry includes 7,000 companies, employs 400,000, and is expected to grow 6 percent per year over the next five years.
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