On June 4, 2025, the United States raised the global tariff on aluminum and steel from 25% to 50%, with the exception of imported metal from the United Kingdom which will remain at 25%. This increase will affect many obvious industries including automotive, construction and infrastructure, and home goods. But buried beneath the headlines is the less obvious cascading impact this tariff has on the medical device industry.

How a Trade War Reaches the Device Market

The medical device industry heavily depends upon steel and aluminum to create diagnostic equipment and sterilization products such as X-ray and MRI machines, needles, surgical tools, and sterilization cases. Because steel and aluminum are foundational to most medical devices small and large, the cost increase has far-reaching implications for manufacturers of every scale. Boston Consulting Group estimates a tariff hike of this scale will add $50 billion in costs across affected sectors. A significant share of the cost will fall on medical technology.

Large companies such as GE Healthcare and Johnson & Johnson are bracing for impact as they revise their companies’ 2025 fiscal estimates. It has been reported that Johnson & Johnson’s Chief Financial Officer Joseph Wolk told investors the company expects to allocate $400 million to tariff-related costs.

Straining Procurement and Innovation

The tariff increase does not just affect the medical device companies, it’s a trickling stream beginning with raw material suppliers, who now pay more to bring steel and aluminum into the country. In order to cover the extra costs, the suppliers increase quotes to the manufacturers who depend on metals to create devices. The vendors feel the financial squeeze as their equipment becomes more expensive. Hospitals and clinics will face budget constraints which will affect inventory. As these challenges build up across the supply chain, the result is product shortages and challenged delivery timelines, especially for smaller firms or startups that lack diversified and domestic sourcing. This ultimately impacts patients through higher costs for care and delays in receiving treatment due to fewer devices being available or affordable.

Companies may see fit to redesign devices to use less metal to save money in the long run, but the process comes at an upfront cost. Redesigning products triggers new testing, validation, and potentially new regulatory submissions. This extended timeline adds cost at every level of the supply chain and potentially delays the commercial launch of innovative technology to the detriment of patients.

What Can Be Done and How Medpoint Can Help

Managing the impact of increased tariffs requires maintaining a stable supply chain, establishing new supplier onboarding and auditing processes, ongoing regulatory compliance, and business continuity. Medpoint experts can assist with alternative and domestic sourcing solutions with proven vendors that maintain compliant quality management systems and manufacturing processes. Medpoint resources can ensure design controls, verification and validation testing, and design history files (DHF) are implemented and documented appropriately in preparation for regulatory submissions in both the US and abroad. Medpoint consultants can also conduct a full operational gap assessment to look for inefficiencies, unforeseen risk, and opportunities for continuous improvement.

Author: Ashlee Bailey, Project Coordinator and Social Media Manager

References

Executive Office of the President. (2025). Fact Sheet: President Donald J. Trump Increases Section 232 Tariffs on Steel and Aluminum. Retrieved from https://www.whitehouse.gov/fact-sheets/2025/06/fact-sheet-president-donald-j-trump-increases-section-232-tariffs-on-steel-and-aluminum/

Cretex Medical. (2022). Stainless Steel or Aluminum? Material Considerations for Sterilization Cases & Trays (June 8, 2022). Retrieved from https://www.cretexmedical.com/blog/2022/06/08/stainless-steel-or-aluminum-material-considerations-for-sterilization-cases-trays/

Boston Consulting Group. (2025). Update: The Impact of U.S. Tariffs—50% on Steel and Aluminum (June 2025). Retrieved from https://www.bcg.com/publications/2025/june-2025-update-impact-us-tariffs-50-percent-on-steel-aluminum

Weintraub, A. (2024). Johnson & Johnson Estimates $400M Impact From Worldwide Tariffs, Largely on Medtech. Fierce Biotech. Retrieved from https://www.fiercebiotech.com/medtech/johnson-johnson-estimates-400m-impact-worldwide-tariffs-largely-medtech