MedTech Dive: Medical device industry caught in US-China trade war

08.13.18

The medical technology industry — imaging in particular — is bracing for what could be rough times as a number of companies are hit by tariffs and counter-tariffs in an escalating trade war between the U.S. and China.

The battle has ramped up considerably in recent months. The Trump administration imposed 25% duties on $34 billion in Chinese goods in early July, then slapped tariffs on an additional $16 billion worth of imports earlier this month.

The administration has also directed the U.S. Trade Representative to look into imposing a 25% tariff on $200 billion worth of additional products from China, including parts and materials used to make medical devices.

Each time, China has fired back with dollar-for-dollar tariffs on U.S. products, the latest on Aug. 7 with $16 billion worth of tariffs on U.S. exports. Among the items caught in the crossfire are MRIs, electrocardiograms, CT scanners, ultrasound devices and X-rays equipment.

“If this keeps escalating and the retaliation goes back and forth, a tit-for-tat game without any end in sight, that’s very concerning to our industry and ultimately to patient care,” said Patrick Hope, executive director of the Medical Imaging & Technology Association, which represents heavyweights like GE Healthcare, Medtronic and Philips, among others.

Layoffs and cuts in R&D

MITA surveyed members to gauge impact the tariffs might have on productivity in the medical imaging sector. The response, “pretty categorically,” was imposition of tariffs would lead to layoffs and major cutbacks in research and development, slowing innovation, he told MedTech Dive.

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