With around half of all medical devices relying on semiconductors, analysts say proposed tariffs could lead to price hikes and supply chain strain.
President Donald Trump’s proposed semiconductor tariffs could threaten the growth of the US medical device industry, as around half of all devices depend on semiconductors (chips) to operate, according to data and analytics company GlobalData.
With global supply chains under strain and costs rising, especially from Taiwan-based suppliers, the healthcare sector faces looming price increases that may hinder accessibility and slow market expansion, says GlobalData.
Reportedly, over 90% of the world’s most advanced chips are made in Taiwan, which currently has a 32% tariff applied on all goods exported to the United States. As of mid-April 2025, Trump has said that he intends to place tariffs on semiconductors at some point in the future. Approximately 50% of medical devices use semiconductors in one form or another to function.
If a major tariff is levied on non-US semiconductors, it is “highly likely” the cost of these medical devices will increase, according to GlobalData. Although major semiconductor manufacturers do have fabrication foundries in the US, the majority of the world’s semiconductors, or wafers, are manufactured outside the US by Taiwan Semiconductor Manufacturing Company Limited (TSMC). According to TSMC, it had manufactured 16 million wafers worldwide in 2024.
“If Trump’s tariffs impact semiconductor imports, companies can expect an increase in cost when sourcing semiconductors and chipsets for medical devices, even if final assembly occurs in the US,” says David Beauchamp, medical analyst at GlobalData, in a release. “These price increases are likely to be passed on to consumers and healthcare systems. Domestic semiconductor production currently lacks the capacity to meet industry demand, making supply chain disruptions inevitable.”
Potential Industy Impact
Currently, GlobalData tracks over $207 billion worth of medical devices in the US. At present, the market is growing at a compound annual growth rate of 4.9% from 2023 to 2033, according to the Medical Market Analyzer. However, with the looming threat of tariffs on medical device manufacturing, it remains to be seen if this high growth rate will continue, or if it will slow as the impact of the tariffs are felt, according to GlobalData.
“The semiconductor industry, which is a vital part of the supply chain for a large percentage of medical devices, is very likely to be affected by the Trump administration’s blanket tariffs,” says Beauchamp in a release. “Even with facilities built in the US, it is highly unlikely that domestic manufacturing of these vital components will be able to meet the demands of the medical device industry, let alone the numerous other industries that rely on semiconductors. With the continuing uncertainty of these tariffs, it remains to be seen what the effects will be on the medical device industry.”
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