2026 Forecast: Medical manufacturing industry outlook

adobe stock | © bidala

Valued at $678.88 billion in 2025, the global medical device market is projected to increase from $719.61 billion in 2026 to approximately $1,209.42 billion by 2035, expanding at a compound annual growth rate (CAGR) of 5.94% from 2026 to 2035. North America held more than 40% of market share in 2025, with U.S. market size calculated at $191.20 billion last year and projected to increase to about $346.19 billion by 2035, a CAGR of 6.2% from 2026.

The U.S. leads the market in medical device production, boosted partly by the rapid shift toward a home healthcare model. Other factors include growing adoption of advanced medical technologies for critical disease diagnosis and treatment procedures, along with increasing prevalence of chronic conditions and increasing healthcare expenses. Asia Pacific is the fastest-growing region due to the increasing occurrence of chronic diseases such as diabetes, cardiovascular diseases (CVDs), and high blood pressure.

Major technological shifts are transforming medical device companies into medtech entities. In an effort to be closer to the end user, manufacturers are using data to incorporate intelligence into products. Future advancements in artificial intelligence (AI) will simplify patients’ own management of chronic diseases, while technology is also expected to impact preventive care, reducing hospital stays.

Deloitte’s 2026 Life Sciences Outlook expanded its reach this year, surveying 280 C-suite executives from biopharma and medtech companies across the United States, Europe (France, Germany, Switzerland, and the United Kingdom), and Asia (China and Japan). The survey found the overall outlook is optimistic though tempered by caution related to persistent geopolitical tensions, pricing pressures, and regulatory shifts. Respondents identified these trends as among the most likely to influence operations in 2026 – 39% named geopolitical tensions as a top issue, an increase of 20 percentage points from 2025 and the largest increase of all tracked trends. Inflation, broader economic pressures, and supply chain risks also comprised a large share at 38%.

IMAGE CREDITS: PRECEDENCE RESEARCH

Accelerated digital transformation also rose sharply from 2025 as an influential trend among respondents, with nearly half identifying it as likely to have substantial impact on their organizations in 2026. Generative and agentic AI were cited as significant, although only 22% of life sciences leaders said they’ve successfully scaled AI, and just 9% reported achieving significant returns on the technology. Cybersecurity concerns are also increasing with the proliferation of digital technology.

The survey found many companies are implementing major transformations to adapt to the growth of AI, but none reported fully completing these transformations. The most progress has been made in integrating AI tools into daily workflows to enhance productivity. Respondents further along in achieving AI maturity expressed greater optimism about the economy, the industry, and their own financial performance.

Investment in AI-enabled platforms was one of three key strategies identified by respondents for 2026, along with new product launches and strategic mergers and acquisitions (M&A) and partnerships. One surveyed executive commented on the importance of product diversification: “In these times, if you have a diversified footprint, you can build that agility muscle to react without being completely dependent on one thing.”

Though challenges compound the path forward, the medical device and overall life sciences industries continue to grow, with technological advancements leading to improvements on the manufacturing floor and at the point of care.

Read on for additional insights from leaders in the manufacturing industry about medical device manufacturing in the coming year.

Mike Johnson, Director of Sales, Solar Atmospheres of Western PA

PHOTOS COURTESY OF
RESPECTIVE COMPANIES

From a vacuum heat treater’s standpoint, the medical industry outlook for 2026 is extremely promising. All six Solar Atmospheres locations are seeing strong growth in heat treating demand for medical raw materials and components. To support this momentum, we’re expanding with a new facility in Connecticut – strategically located to better serve our growing customer base and strengthen our support for the aerospace, medical, and commercial manufacturing sectors across New England.

As customers accelerate their use of automation, lights-out manufacturing, and robotics, the need for fast, reliable vacuum furnace processing has increased significantly. This rising demand has created ongoing scheduling challenges throughout 2025. In response, we’re assigning dedicated personnel to oversee medical workloads, adding new vacuum furnaces and clean room capacity, and encouraging customers to qualify alternate Solar Atmospheres locations when possible to improve turnaround times.

The alloys driving most of our heat treat activity in 2025 include titanium, PH grades such as 17-7, 15-5, and 17-4, as well as 300- and 400-series stainless steels. With these sensitive materials, we’ve seen prime OEMs refine their vacuum thermal cycles, prompting close collaboration with our furnace manufacturing division to ensure full compliance while keeping processing costs efficient.

After customers worked through excess inventories in 2023 and 2024 – largely the result of lingering COVID-era supply chain disruptions – 2025 finally marked a return to stability and strong, sustained growth for the industry. https://solaratm.com/

Tom Baldock, Sales Manager, Extrusion Division, Guill Tool & Engineering

Guill Tool has achieved a series of successes in the areas of multi-layer dies and, most recently, a reciprocal tubing die for wound draining that reconfigures the internal chambers of the tubing to accommodate drainage. Drain tubes can be inserted prophylactically to prevent or remove the accumulation of fluid in a wound, or therapeutically inserted to evacuate an existing collection of fluid in a wound. Fluid is removed to treat or prevent infection and promote wound healing and patient comfort. Drain tubes can also be used to diagnose post-operative complications such as an anastomotic leak or hemorrhage.

The Guill design has features eliminating the need to weld or otherwise join sections with different profiles. Our automated extrusion process drastically changes the extruded profile in production, with no need to join separate sections of internal profiles.

While cost and value stream activities are reduced, quality is improved. Only one extrusion run is needed to produce a finished product, as opposed to multiple extrusion runs with tooling changes along with a manual assembly operation to connect different tubing shapes via sonic welds or other methods of joining. Guill’s new reciprocating head eliminates this entire assembly operation. It also eliminates in-process inventory. There’s no need for storage of various tubing shapes and connectors needed for assembly, fulfillment of orders, and replenishment of finished goods.

The reciprocating head eliminates a connecting piece and allows just-in-time production and products made-to-order. Lastly, it reduces total run time from receiving the order to shipping the product.

The traditional tip and die assembly is replaced with a linear reciprocating assembly, changing the tube’s profile within a given length. This process is repeated throughout a single extrusion run without interruption. Cutting capability, in association with the extrusion speed, cuts the finished product to length.

We expect this trend and others to increase in the new year, offering us enhanced opportunities in the medical market. https://guill.com

Ryan Poff, Vice President of Sales, John Evans’ Sons

As we look toward 2026, the medical device industry continues to push for components offering better reliability, longer cycle life, and consistent performance. The strongest growth areas we’re seeing are increased use of constant force springs, power springs, and spiral torsion springs across a wide range of medical applications.

A major trend is a push to design devices that do more without increasing overall size or complexity. OEMs are turning to constant force and power springs because they provide dependable performance while meeting high reliability and lifecycle expectations. These springs are being used more frequently in drug-delivery devices, wearables, diagnostic equipment, and surgical tools requiring repeatable, long-lasting operation. Spiral torsion springs are also gaining momentum as manufacturers look for compact torque solutions for catheter systems, surgical robotics, and various rotating mechanisms. Their ability to deliver steady torque while fitting into tight design envelopes makes them a practical choice for many next-gen devices.

We’re also seeing OEMs want technical support much earlier in the design process. They’re looking for partners who can review concepts, identify the most effective spring design, and ensure the design can be efficiently manufactured. Our engineering team excels in this area, working directly with design teams to solve challenges, reduce development time, and streamline the path to production.

Looking ahead, constant force, power, and spiral torsion springs will continue to play an important role in helping manufacturers bring dependable, high-performance medical devices to market. https://springcompany.com

Brian Falk, Director of Business Strategy, Scientific Cutting Tools

I don’t need a forecast to remember why medical manufacturing matters. Years ago, I survived a serious motorcycle crash because a hospital team had the implants and instrumentation they needed, including rods and plates that rebuilt what was broken. Every one of those components depended on precision manufacturing, and on supply chains that delivered reliably when seconds and outcomes mattered.

That same theme will define 2026 for medtech manufacturers: predictability at scale. Demand will keep pushing toward smaller features, more complex geometries, and higher mix. At the same time, quality requirements will become more operationally visible as FDA’s Quality Management System Regulation (QMSR) takes effect February 2, 2026 and aligns Part 820 more closely with ISO 13485:2016. For many companies, the practical shift will be less about adding “more quality” and more about tightening traceability, supplier controls, and objective evidence that processes are stable over time.

On the shop floor, that will accelerate three manufacturing behaviors we’re already seeing. First, more automation designed for high-mix reality, including in-process verification and standardized tool assemblies enabling repeatable setups. Second, more focus on process security for difficult-to-machine materials common in medtech, where tool wear, heat, and burr formation can drive both scrap and inspection load. Third, continued growth in hybrid workflows, such as near-net additive parts followed by high-speed, simultaneous 5-axis finishing, which increases the importance of surface integrity and consistent finishing performance.

In 2026, the shops separating themselves will be the ones connecting compliance, automation, and machining strategy into one system. When the goal is reliable patient outcomes, “good parts” are not enough. Manufacturers will need repeatable processes that can be proven, documented, and sustained, shift after shift. https://sct-usa.com

Michael Huggett, President & CEO, INDEX

The coming year will see device complexity continue to increase, regulatory expectations remain demanding, and supply networks stay under pressure. These ongoing considerations are driving several trends shaping 2026 for medical manufacturers. The beginnings of a new operational model have emerged, and companies’ focus will shift from incremental improvement to strategic transformation, driven by proximity to market, artificial intelligence (AI), and adaptability.

Reshoring and near-shoring are accelerating as OEMs seek to reduce risk from long supply chains, unstable logistics, and geopolitical uncertainty. By placing critical machining and validation capabilities nearer to customers and clinical markets, manufacturers are improving responsiveness, protecting compliance timelines, and strengthening operational resilience. In 2026, the companies most effectively pursuing this proximity-based strategy will gain a key competitive advantage.

Any consideration of the coming year must include the expanding impact of AI. Advances are quickly establishing AI as a connective tissue between engineering, production, and quality. It’ll significantly increase the usefulness and ease-of-use of existing tools, such as real-time machine monitoring, predictive process correction, digital twins, and automated documentation. As device complexity rises and engineering resources tighten, companies will rely on AI as an amplifier and accelerant for technical decision-making. Those leading the way will achieve more stable, anticipatory operations well-suited to countering unpredictability.

Thanks to high-mix production environments, advanced geometries, and faster product cycles, demand for engineering capacity is outpacing the availability of skilled process engineers. As this specific section of the skills gap widens, manufacturers will increasingly turn to engineering partnerships to develop, validate, and optimize their processes. Machine tool builders and other advanced equipment providers already face a growing demand to move beyond transactional purchases. There’s a significant growth opportunity for early movers who shift to a model of delivering sustainable capabilities rather than mere physical equipment.

Lastly, 2026 will see the benefits of agility outweigh those of scale. Medical manufacturers must rapidly switch between part numbers while maintaining micron-level precision, even as they monitor and respond to shifts in market and clinical needs. The industry will be led forward by organizations that strategically harness technology and partnerships to stabilize complex processes and adapt quickly to change. The future of medical manufacturing will reward resilience, adaptability, and smarter execution – not just efficiency. https://www.index-group.com

Preben Hansen, President, Platinum Tooling Technologies

Platinum Tooling has experienced a significant rise in medical manufacturing business over the past few years, a trend that appears poised to continue into the new year. Ongoing investment and innovation are driving efforts to develop new products and the medical sector, supported by increased funding for research and development, is well positioned for further growth. Our nation’s aging population, along with the growing demand for replacement body parts and more advanced diagnostic tools, are also contributing to this sustained increase in medical-industry spending. Platinum Tooling provides an array of machine tool accessories to help manufacturers improve their productivity and throughput scenarios, especially vital on families of products produced for the medical market.

As an example, our company recently introduced a line of speed increasers and one customer, Boston Scientific, uses them to produce high-precision battery cases for pacemakers. By changing from milling to Swiss machines and utilizing Platinum speed increasers, the company dramatically increased production throughput at their facility, while maintaining accuracies to 0.0002" profile tolerances. Likewise, the material consumption was reduced from 0.300" to 0.100" and the company achieved a superior surface finish when drilling, reaming, and profile and face milling, which improved tool life and greatly reduced cycle time compared to the previous method. Our innovation proved beneficial in many ways.

We at Platinum Tooling look forward to another exciting year of such challenges in the medical manufacturing market. https://platinumtooling.com

Dan Janka, President, Mazak USA

If there’s one thing that’s certain, it’s change. And nowhere else does that hold true more than with the ever-changing political and economic landscape in which we live and work.

We in manufacturing must move past the distractions, block out the noise, and stay the course in 2026 to focus on what’s true.

Inflation and employment rates will likely remain stable, reshoring and foreign investment expect a continued rise, U.S. manufacturers will see very favorable tax legislation implemented, and the overall 2026 economic outlook is positive. Additionally, specific industry sectors such as aerospace and defense, semiconductor, oil and gas, and others will continue to grow.

To prepare and strengthen their competitiveness, shops need to reduce overall production costs while increasing their output. To do so, they must incorporate new ways to integrate automation along with manufacturing innovations that truly drive results going forward.

Automation will continue to drive increased output for today’s manufacturers struggling with skilled labor shortages and meeting high customer demand. Equally, multi-tasking machine technology will allow them to produce more with less and stretch their capabilities beyond those of milling and turning, including processes such as friction stir welding, grinding, and additive manufacturing (AM).

Along with machine technology, more shops will rely on advanced control technology and digital manufacturing solutions. The increased use of artificial intelligence (AI) and predictive analytics will allow those shops to prevent production downtime and optimize machine performance and utilization. https://www.mazak.com

Brendt Holden, President & CEO, HAIMER USA

In North America, I expect the manufacturing industry in 2026 to show overall growth in business in many high-end product segments such as aerospace, defense, space, medical, energy, and semiconductor-related manufacturing. For HAIMER, our sales growth will predominantly be related to an expected increase in machine tool sales as companies strive to modernize their equipment to be more efficient. This efficiency comes from an ability to machine parts faster by investing in modern machine designs that can eliminate setups, such as 5-axis, Swiss, or mill/turn machines. This leads to more energy efficiency as well. I expect this growth to happen at all shop levels, from smaller multi-segment parts machining job shops to mid-sized and large production manufacturing companies.

In addition, there will be continued investments in 2026 in automation throughout the machining process, both on the machine and in the tooling and planning stages of production. This automation is driving to increase efficiency and help with the skills gap caused by the lack of skilled workers in our industry as people retire and fewer people enter the manufacturing workforce. This automation push is where HAIMER plays a role with the ability to provide an efficient and consistent tool assembly setup process along with the integration of tool management software to control and aid the entire production process from start to finish. In summary, I predict a bright future for North American manufacturing in 2026. https://www.haimer.com

Charles Cohen, President, Fotofab, a TPC company

In 2026, we believe two questions will shape the medical device industry: How fast can we move? and Can we trust our supply chain? As competition intensifies across the sector and new technologies and production methods are adopted, manufacturers face growing pressure to bring products to market faster and secure component sourcing while meeting increasing demand for cost-effective, high-quality medical devices.

Advanced manufacturers in the U.S. will play a defining role in supporting this growth. An accelerated interest in wearables and personalized medical solutions is pushing original equipment manufacturers (OEMs) to seek smaller, more intricate components requiring tight tolerances. Concurrently, speed has become a critical differentiator, with manufacturers expected to move quickly and seamlessly from prototype to production without compromising quality or performance.

To meet these evolving requirements, manufacturers are embracing advanced processes such as photochemical etching and diffusion bonding. These technologies enable complex geometries, hermetically sealed assemblies, and enhanced thermal, microfluidic, and filtering capabilities essential for medical devices. These processes expand design possibilities and bypass traditional manufacturing constraints.

Supply chain dynamics are also reshaping the competitive landscape. With global uncertainty and shifting tariff environments prompting companies to reassess offshore sourcing, domestic manufacturing partners must be equipped to deliver high-quality components, reliable lead times, and strong intellectual property protections. With customers increasingly motivated by risk reduction, cost efficiency, and the need to accelerate time to market, advanced manufacturers will need to adapt with customers amid changing economic environments.

The medical industry is poised for a strong year. Manufacturers that embrace innovation, communicate openly, push boundaries, and develop strong customer relationships will be positioned for success in 2026. https://fotofab.com

Adam Hesse, CEO, Full Spectrum

The current limitations and anti-patterns of leaning too heavily on artificial intelligence (AI) will be exposed in the coming year. A major question for 2026 is whether the FDA possesses the internal expertise and bandwidth to correctly implement and manage complex AI systems, ensuring accuracy and fairness. There’s a risk of AI over-correction, with AI grading submissions, particularly those with complex data, more harshly than human reviewers, leading to an initial increase in submission failures or rejections.

The patterns and anti-patterns of successful AI adoption, which were heavily explored in 2025, will become clearer for the entire industry in 2026. Experimentation with AI in regulation will become more measurable, but the fundamental lessons will still be in flux.

A growing trend of corporate buyouts, spin-offs, and privatization will accelerate as organizations seek to shed quarterly pressures and sharpen their focus on long-term, high-risk, high-reward innovation and R&D. Larger, publicly traded companies are under pressure to deliver predictable quarterly earnings, which often stifles the flexibility and risk-taking essential for innovative R&D. They will increasingly rely on buying their innovation through acquisitions (buyouts) or creating more agile, focused spin-off entities.

The shift of healthcare products and services out of traditional clinical settings and directly into the hands of the consumer will be a major market driver in 2026. Consumer-direct therapeutics and medications such as GLP-1s (for diabetes and weight management) are fundamentally acting as blockbuster consumer products, bypassing or minimizing the traditional physician-gatekeeper model. Additionally, there are financial and entrepreneurial drivers, with the increased prevalence and utilization of Health Savings Accounts (HSAs) continuing to drive opportunities for entrepreneurial healthcare businesses, as consumers have more direct control over their healthcare dollars. Also, advanced remote patient monitoring (RPM) tools will increasingly be marketed as consumer products, expanding beyond chronic care to general wellness and acute event management. Examples include personal electrocardiogram (ECG) devices (such as those in the Apple Watch), home-use concussion assessment tools (such as Evoke), and consumer-accessible auto-injectors such as EpiPens and Narcan. https://fullspectrumsoftware.com

Ross Meyercord, CEO, Propel Software

This year will mark the tipping point for connected intelligence. Software platforms that extend data and workflows across the enterprise will dominate, while isolated tools will fade into irrelevance. Agentic artificial intelligence (AI) is already proving productivity breakthroughs come from collaboration, between systems as much as people.

The next generation of AI agents won’t live inside individual apps. They’ll communicate, coordinate, and act across entire tech ecosystems, turning fragmented processes into fluid, intelligent networks. In this new era, standalone software simply won’t be able to compete. The demise of remaining on-premise software will accelerate, leaving just 15% of those companies over the next three years.

Managing AI agents is the hottest gig in town. From picking the right AI for the right job, to connecting who’s who to get the best data, only the most optimized queries at the best price will win out. But 2026 will prove omniscient agents do not exist. Domain-specific agents will emerge as clear winners as users rely on tribal knowledge and industry expertise to propel business. As a result, companies will be investing in service terms to revolutionize how AI is monetized in the next 12 to 18 months. Buyers will flock to AI services delivering domain expertise in areas such as legal, finance, and healthcare, leveraging best practices to fulfill productivity and efficiency gains.

Business-to-Algorithm (B2A) will redefine commerce as AI drives vendor discovery, evaluation, and selection. For manufacturers, brands, and product companies, this shift creates opportunity. Smaller players can compete with industry giants if their product, quality, and compliance data is clean, structured, and algorithm-ready. But the threat is equally real: companies lacking data discipline risk being invisible in digital buying journeys.

Manufacturers can now earn 10x to 20x the original purchase price on services over the product’s lifetime. What’s different? Now manufacturers possess something they’ve never had: real-time product and component performance data coupled with AI to predict failures before they happen. Combined with detailed product data for each individual unit, manufacturers can trigger proactive replacements that reduce the number of service calls and minimize unscheduled downtime – if not eliminate it altogether. This shift turns reactive service overhead into predictable revenue. Customers will pay for better outcomes. The key to success? Clean, structured product and service data that’s AI-ready.

In 2026, the winners will be those who combine the agility of AI agents with the reliability of Software-as-a-Service (SaaS) to deliver measurable business value. SaaS brings the workflows, governance, and guardrails enterprises demand, while AI agents extend productivity and speed. One without the other falls short, but together, they set the new standard for enterprise software.

AI and robotics will reshape patient care. Robotic systems will increasingly enhance controls and positioning, while AI ensures precision, and augmented reality (AR) lets surgeons pre-plan and overlay visualizations in real time. This shift reduces surgery times, lightens staffing demands, and expands access into ambulatory service centers. At the same time, AI-powered software is improving treatment for chronic diseases and boosting drug effectiveness. 2026 is poised to be the breakout year when robotics, AI, and AR redefine surgical care. https://www.propelsoftware.com