Prices paid in the U.S. for medical devices, including those that regulate the heart’s rhythm and replacements for hips and knees, have plunged as much as one-third since 2007 as hospitals clamped down on spending.
The average inflation-adjusted prices for seven of the largest categories of medical devices fell through 2011, according to a study released today from the Advanced Medical Technology Association. Drug-coated stents used to prop open arteries sold by Boston Scientific Corp. (BSX), Abbott Laboratories (ABT) and Medtronic Inc. (MDT) had a 34 percent decline. Artificial knees from Johnson & Johnson (JNJ), Zimmer Holdings Inc. (ZMH) and Stryker Corp. (SYK)fell the least at 17 percent.
The results suggest medical technology isn’t responsible for driving up health-care costs in the U.S., where prices for devices have risen at less than half the pace of goods in the U.S. economy for two decades, said Stephen Ubl, chief executive officer of the industry group known as AdvaMed. The open market works for medical devices, he said.
“It’s an incredible value story to talk about price declines against the backdrop of public health gains,” Ubl said in a telephone interview. “What else in health care can you say is going down in terms of price? At least in this part of health care, good old fashioned competition works well.”