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Medical Devices Trade Agreements for Healthcare

The modern healthcare industry, particularly in the United States, is guided by market forces. Therefore, many of its elements are inherently affected by globalization and international trade agreements which can impact supply and demand, costs, and availability of certain technologies or pharmaceuticals. This report will examine the aspect of the medical device of healthcare in the context of the international market and the newly introduced United States–Mexico–Canada Agreement (USMCA) trade deal.

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Medical Devices

Medical devices are any instruments or apparatus which is used for healthcare and medical diagnosis, management, and treatment. It is most commonly referred to as technological devices utilized in healthcare settings or provided to patients for at-home use. Although objects such as thermometers, gloves, and bedpans are considered medical devices, this report will focus on the more complex technologies. These include software and hardware that are commonly used to sustain life such as embedded devices (pacemakers), prostheses, and medical testing or upkeep with complex electronic or digital components (Khan, Ostfeld, Lochner, Pierre, & Arias, 2016).

Market Description

The global medical devices market is tremendous and continuously growing, introducing many opportunities as well as challenges for U.S. manufacturers which are one of the leading specialists for complex technologies. Over 84 global markets are available to the U.S. for medical devices, with neighboring Canada and Mexico being highly profitable markets and critical supply chain partners. To sustain manufacturing and export, U.S. medical companies require the aid of the U.S. government to reduce market access barriers and foster good relationships with key trading partners to maintain a strong U.S. healthcare industry (International Trade Administration, 2016).

Trade Deal

The USMCA is a change introduced by the Trump administration to improve the existing NAFTA trade agreement among Canada, U.S., and Mexico. It has made substantial changes to key sectors, including those affecting medical devices. Negative changes are most likely to impact the U.S. as the leading producer of these products. USMCA introduces a stricter regulatory environment which may potentially limit innovation in the long-term, including speed of technology sharing, ability to raise capital funds from investors, and consumer demands. Under NAFTA, an existing ecosystem of suppliers for sensors and devices was available which was reliable (critical in this health-related technology). Furthermore, USMCA is a relatively untested treaty, with the Trump administration constantly using it as a political tool to threaten Canada and Mexico which could result in retaliatory sanctions or the VAT being scrapped, which will disrupt both profit margins and ability to competently continue production for many U.S. manufacturers (Guimond, Krouse, & Beauregard, 2018).

However, the USMCA oversight also benefits the medical devices market by promoting alignment of technical regulations and standards, which improve assessment, conformity, and notification procedures. It recognizes pharmaceuticals and medical devices in the operation of competitive markets and forces to objectively demonstrate the therapeutic significance of the device (Ciuriak, Dadkhah, & Xiao, 2019). The USMCA also greatly improves on the aspect where NAFTA was outdated, which is intellectual property. The technology is developed in the U.S., with many components are produced in Mexico, and the final product completed in Canada. Both Canada and Mexico have much less stringent intellectual property protections, which leads to disparities among the three partners. USMCA unifies these aspects and increases protections for the technology of the medical devices (Doby & Siem, 2019).


Medical devices are a critical aspect of healthcare delivery, becoming more prevalent for health management as technology becomes more complex and reliable. There is a significant market for medical devices, particularly in the North American region which is currently regulated by the USMCA treaty. The recently developed USMCA offers strict regulations which may stifle funding and innovation but offers efficient standardization and key protections for intellectual property.


Ciuriak, D., Dadklah, A., & Xiao, J. (2019). Quantifying the USMCA. In GTAP annual conference (pp. 1-31). Warsaw, Poland: GTAP.

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Doby, D., & Siem, M. (2019). Impact of the USMCA on the medical device industry. Web.

Guimond, M., Krouse, J., & Beauregard, K. (2018). The end of NAFTA and a future for companies in the medical device industry. Undergraduate Review, 14, 58-67.

International Trade Administration. (2016). 2016 top markets report – Medical devices. Web.

Khan, Y., Ostfeld, A. E., Lochner, C. M., Pierre, A., & Arias, A. C. (2016). Monitoring of vital signs with flexible and wearable medical devices. Advanced Materials, 28(22), 4373–4395. Web.

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