Moody's: Outlook for medical devices, products still negative

For reasons that will prove no surprise to readers--including depressed hospital admissions and weaker hospital access to capital--medical products and devicemakers are likely to face financial challenges in the U.S. market for a while yet, according to Moody's Investors Service.

With non-profit hospitals--the key customers for medical products--struggling to access capital and maintain liquidity, they've cut back significantly on medical product spending during the first half of this year. This trend is likely to continue throughout the year, Moody's projects. What's more, hospital inpatient volumes are likely to stay lower than usual for some time, analysts note.

All that being said, the industry is staying on its feet, notably due to expanding sales in non-U.S. markets and ongoing product innovation, the firm said.

Still, this sounds like a good time for hospital administrators to put the squeeze to their vendors, if they haven't done so already. In six months or so, if Moody's is correct, that window of opportunity may close.

To learn more about these trends:
- read this Moody's press release (reg. req.)

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