Last Updated May 2025
As the Trump administration implements a tariff-heavy trade policy, the global medical device industry finds itself caught in the crossfire. With a focus on reshoring manufacturing and protecting U.S. interests, the new tariffs are creating a complex landscape for global medtech firms. Still, while the rhetoric surrounding tariffs is heated, the actual financial impact on the sector, at least for now, appears to be modest.
Tariffs are assessed not only by country of origin, but by type of product. Accordingly, the medical technology industry’s leading trade group, AdvaMed, has been actively lobbying the administration to reconsider the application of tariffs to medical devices. Scott Whitaker, AdvaMed’s CEO, has taken the lead in engaging with policymakers in Washington, urging them to exempt essential health care products from the latest rounds of duties. In AdvaMed’s view, applying tariffs to life-saving medical equipment not only increases costs for patients and providers but also risks undermining domestic manufacturing goals by creating added uncertainty for U.S.-based operations.
Meanwhile, the largest publicly traded medical device companies have already begun assessing and disclosing the likely earnings impact of the tariffs. Across the board, guidance suggests that the near-term effects will be limited. As of this writing (May 2025) The following table summarizes the hit to EBITDA that the Administration’s tariff plan will create:
| Company | TTM Revenue ($B) | TTM EBITDA ($B) | $M Tariff Impact (Next 12 mo) | Impact to EBITDA (%) | Company Leadership Commentary |
|---|---|---|---|---|---|
| Johnson & Johnson | $94.9 | $29.7 | $400 | 1.3% | CFO Joseph Wolk indicated that the $400 million impact is primarily from medtech tariffs, especially related to exports to China. CEO Joaquin Duato emphasized that tax policy, rather than tariffs, is a better strategy for encouraging U.S.-based manufacturing. |
| Intuitive Surgical | $9.0 | $2.7 | $153 | 5.7% | CEO Gary Guthart stated that tariffs could materially affect financial performance, leading to a reduced gross margin forecast of 65%-66.5% for 2025. |
| Edwards Lifesciences | $6.0 | $2.0 | $30 | 1.5% | CFO Scott Ullem mentioned that tariffs are expected to have a minimal impact, with a $0.05 per share effect, and the company maintained its full-year guidance. |
| Abbott Laboratories | $41.4 | $10.4 | $200 | 1.9% | CEO Robert Ford indicated that while tariffs will add costs, Abbott is maintaining its earnings forecast for 2025. The company is investing $500 million in U.S. manufacturing to mitigate tariff impacts. |
| Medtronic | $32.4 | $8.9 | N/A | N/A | CEO Geoff Martha stated that Medtronic's exposure to tariffs is relatively low, with less than 1% of revenue coming from imports from China. The company is actively working to diversify its supply chain and reduce reliance on tariff-prone regions. |
| Stryker | $20.6 | $5.1 | $200 | 3.9% | CFO Preston Wells reported an expected $200 million hit from tariffs in 2025, leading to a slight reduction in earnings guidance. The company plans to offset costs through sales momentum and operational efficiencies. |
| Becton Dickinson (BD) | $21.8 | $5.5 | $70 | 1.3% | The company lowered its annual profit forecast, anticipating a $0.25 per share impact from tariffs. BD is investing $2.5 billion in U.S. manufacturing capacity over the next five years to mitigate future risks. |
| Boston Scientific | $16.7 | $4.4 | $200 | 4.5% | CEO Mike Mahoney expressed confidence in offsetting the $200 million tariff impact through sales growth and cost reductions, including discretionary spending cuts. The company raised its 2025 guidance, anticipating 15%-17% sales growth. |
| Alcon | $10.2 | $2.0 | N/A | N/A | Alcon reported that tariffs are expected to impact margins in the second half of 2025 but maintained its revenue guidance, forecasting sales between $10.2 and $10.4 billion for the year. |
| Dexcom | $4.6 | $1.4 | N/A | N/A | Dexcom expects minimal tariff impact due to its strong U.S. manufacturing presence in Mesa and San Diego facilities. |
| Terumo | $7.0 | $1.3 | $110 | 8.5% | Terumo has not incorporated the potential impact of U.S. reciprocal tariffs into its guidance due to uncertainty but acknowledges a possible maximum impact of approximately ¥17 billion. |
Mitigating Tariff Risk with a US Based Sterilization Solution
Most companies expect the full-year impact of tariffs to remain under 8% of EBITDA, with many labeling the effect as “immaterial” or “manageable.” Notably, several firms, including Boston Scientific and Abbott, emphasized that their 2025 earnings guidance remains unchanged, signaling confidence in their ability to absorb additional costs through productivity improvements and supply chain optimization.
Navigating Tariff Uncertainty in Long Term Planning
The more damaging consequence of the current Administration’s trade negotiations may not be the immediate hit to earnings but the longer-term uncertainty being injected into strategic planning. While the Trump administration’s pro-manufacturing stance could ultimately benefit the sector, the unpredictability surrounding tariff enforcement, trade negotiations, and bilateral deals creates hesitation to make key decisions.
Companies are wary of making large capital investments in supply chain infrastructure, including new manufacturing facilities, long-term component sourcing agreements, or multiyear logistics contracts, without a clearer sense of which goods might be subject to future tariffs—and at what rate. As one executive put it, “You can manage costs, but you can’t plan for chaos.”
This uncertainty is particularly problematic in an industry known for its long product development cycles and rigorous regulatory requirements. A shift in tariff policy midway through the launch of a new device can significantly disrupt timelines, cost structures, and even market access.
To hedge against these risks, many medical device manufacturers are increasing investment in U.S.-based production. For example, Becton Dickinson has announced a $2.5 billion commitment to expand domestic manufacturing capacity, while Abbott is allocating $500 million toward similar efforts. These moves not only improve resilience to future trade shocks but also align with the administration’s call for economic patriotism.
Mitigating Tariff Risk with a U.S.-Based Sterilization Solution
If you are seeking to mitigate your exposure to tariff risk, NextBeam is well positioned to support both products being sold into the US market with our centrally-located Facility 1. Contact us for more details.
Additional Articles We Think You Might Like
Have a question? Speak with a sterilization expert today, at your own convenience.
