Surgical Instrument Tracking System Market is set to grow from $203 million in 2021 to $406 million by 2026, at a CAGR of 14.9%. Growth is driven by FDA’s UDI mandates and the rising focus on healthcare cost-efficiency. Challenges such as high system prices and slow investment cycles may restrain growth, but markets like India and China present strong opportunities as healthcare infrastructure improves. North America leads in market share, while Asia Pacific is poised for rapid expansion. Leading players such as Fortive Corporation, Becton, Dickinson, and STERIS are focusing on acquisitions to expand their tracking capabilities.
Key Player
The key players operating in this market include Fortive (US), Material Management Microsystems (US), Becton, Dickinson and Company (US), Haldor Advanced Technologies (Israel), Intelligent InSites, Inc. (US), Key Surgical, Inc. (US), Mobile Aspects (US), TGX Medical Systems (US), Xerafy (Singapore), STANLEY Healthcare (US), B. Braun Melsungen AG (Germany), Getinge AB (Sweden), Infor Inc. (US), SpaTrack Medical Limited (UK), and Scanlan International, Inc. (US).
Driver: Need to meet FDA’s Unique Device Identification mandates
Manufacturers are required to track surgical instruments from manufacturing through the distribution chain. The purpose of device tracking is to ensure that manufacturers of instruments establish tracking systems that will enable them to promptly locate devices in commercial distribution.
The UDI (Unique Device Identification) regulations proposed by the US Food and Drug Administration (FDA) are expected to drive growth in the surgical instrument tracking systems market. According to the UDI rules, labelers (manufacturers, reprocessors, specification developers, repackagers, and relabelers) of surgical instruments are expected to implement direct marking at the individual instrument level.
Until September 24, 2020, surgical instruments categorized as Class I devices had to fully comply with these FDA requirements. However, the date was then shifted to September 24, 2022. Additionally, labelers need to submit information about each device to the FDA's GUDID (Global Unique Device Identification Database). This database serves as a reference catalogue for all devices. These mandates are expected to be the key factor driving the adoption of surgical instrument tracking systems among end users.
Restraint: High system costs, long investment cycles, and low ROIs
Surgical instrument tracking systems require heavy upfront investments that encompass the costs of application software, hardware, tags, and middleware; the cost of integrating the barcode and RFID framework with the legacy system; and the cost of maintenance services, consulting fees, and staff training. Although the cost of tags and readers has reduced considerably, the implementation cost of automated tracking systems, such as RFID, that require additional servers, databases, and middleware has been steadily increasing. The overall cost of implementing automated surgical instrument tracking systems using RFID is very high compared to traditional systems, such as barcode-based systems. Apart from high implementation costs, most automated surgical instrument tracking systems have very long investment lifecycles.
The Barcode segment accounted for the largest market share in 2020.
Based on technology, the surgical instrument tracking systems market is segmented into barcode and RFID. The barcode segment accounted for a larger market share in 2020. The low installation cost of barcodes has resulted in their increased adoption in the surgical instrument tracking systems market.
The Software segment accounted for the largest market share in 2020.
Based on components, the surgical instrument tracking systems market is segmented into software, hardware, and services. The software segment accounted for the largest market share in 2020. However, the hardware segment is expected to witness the highest growth during the forecast period. This is mainly due to the repeat purchase of non-durable RFID tags/barcode labels that need replacement, as tags/labels are prone to detachment during washing and/or damage during sterilization cycles.
The Hospitals segment accounted for the largest market share in 2020.
Based on end users, the surgical instrument tracking systems market is segmented into hospitals and other end users. The hospitals segment accounted for a larger share of the surgical instrument tracking systems market in 2020. Growth in the hospitals end-user segment can be attributed to their high patient inflow compared to other end users in the market. Hospitals also use more equipment and instruments on average than other healthcare providers and conduct a greater number of surgical procedures. This has ensured a sustained demand for tracking solutions in hospitals.
Recent Developments:
- In November 2020, STERIS acquired Key Surgical to strengthen, complement, and expand STERIS product offerings and global reach.
- In July 2020, Vizinex RFID (US) launched Flexible 6012 and Flexible 6027 RFID tags, which offer mounting flexibility, are durable, and are IP67-rated, making them ideal for tracking many types of assets in indoor settings.
- In May 2020, Stanley Healthcare partnered with Cisco. Under this partnership, STANLEY AeroScout real-time location system (RTLS) platform was fully integrated and certified with CISCO DNA Spaces, the next-generation indoor location services platform, to offer enterprise-wide visibility into the location and status of assets and people in healthcare environments.
- In November 2019, Fortive Corporation acquired Censis Technologies to expand its SaaS-based surgical instrument tracking and workflow solutions.
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