Introduction
Healthcare bankers advising on cross-border MedTech transactions must understand that FDA clearance does not automatically translate to European market access, and vice versa. The EU Medical Device Regulation (MDR 2017/745), which became fully applicable in May 2021 (with extended transition periods), fundamentally changed the European regulatory landscape for medical devices, creating both risks and opportunities for MedTech companies and their acquirers.
What EU MDR Changed
The previous EU system (Medical Device Directives) relied on Notified Bodies to certify devices with relatively limited clinical evidence requirements. MDR significantly raised the bar:
Clinical evidence requirements. MDR requires substantially more clinical data than the previous directives, including clinical investigations (similar to clinical trials) for higher-risk devices. The previous system allowed many devices to rely on literature-based clinical evaluations and equivalence claims.
Post-market surveillance. MDR mandates active post-market clinical follow-up (PMCF) for most device classes, periodic safety update reports (PSURs), and registration in EUDAMED, the European database for medical devices. EUDAMED is no longer voluntary: its first four modules became mandatory on 28 May 2026, covering actor and device registration, notified bodies and certificates, and market surveillance.
Unique Device Identification (UDI). All devices must carry a unique identifier enabling traceability from manufacturer through the supply chain to the patient.
- Notified Body
An independent organization designated by an EU member state to assess whether medical devices meet MDR requirements before they can receive a CE mark and be sold in Europe. Unlike the FDA (a single government agency), the EU system relies on multiple private Notified Bodies competing for manufacturer business. MDR's stricter designation criteria shrank the pool from roughly 80 bodies operating under the old Medical Device Directive to the 52 designated for medical devices as of February 2026, and those 52 now carry a far heavier assessment workload per device.
The Transition Challenge
The MDR transition has created significant disruption:
Portfolio attrition. Recertification is a commercial decision as much as a regulatory one, and many manufacturers have concluded that low-volume products do not earn their compliance budget. In the Commission's third survey of device manufacturers and authorised representatives, 48% of the 152 responding device makers said they had stopped producing, marketing, or supplying some devices to the EU market since 2021. 63% of them pointed to the same reason: product revenue no longer justified the cost of reapproving the device under MDR. Low-volume and end-of-life products absorb most of that attrition.
Certification capacity. By the end of February 2026, Notified Bodies had received 31,902 MDR certification applications but had issued only 12,036 quality management system certificates and 6,203 product certificates, and more than two in five manufacturers surveyed had yet to receive a single MDR certificate. European launch plans should treat conformity assessment as a multi-year workstream.
The legacy certificate cliff. Regulation (EU) 2023/607 extended old directive certificates to 31 December 2027 for class III and implantable class IIb devices, and to 31 December 2028 for most class IIa, other class IIb, and sterile or measuring class I devices, provided manufacturers filed on time. Those dates sit inside the hold period of any MedTech deal signed today.
Cost increases. Manufacturers reported average direct costs of roughly EUR 89,000 for an initial MDR quality management system certificate (median EUR 50,000) and roughly EUR 195,000 for an initial product certificate (median EUR 100,000), before clinical evaluation work that averaged close to EUR 77,000 for a single class III device.
The December 2025 Simplification Proposal
The European Commission acknowledged the cost of the transition and, on 16 December 2025, published a proposal to amend both MDR and the In Vitro Diagnostic Regulation. The package targets predictability rather than deregulation: binding timelines for conformity assessment, lighter re-certification obligations, wider use of electronic instructions for use, clearer classification rules for software and AI-enabled devices, dedicated pathways for orphan and breakthrough devices, and EU participation in the Medical Device Single Audit Program.
None of it is law yet. The file is still awaiting a committee decision in the European Parliament, with committee amendments tabled in July 2026 and Council negotiations still ahead. One piece of the reform agenda has already landed: Commission Implementing Regulation (EU) 2026/977, adopted in May 2026 and applying from 25 February 2027, sets stage-by-stage deadlines for Notified Body assessments and requires cost transparency, including advance notice of any increase above 10% on a quoted fee.
This article concludes the Medical Devices & MedTech section. The next section covers Healthcare Services, where the business model shifts from physical products to labor-intensive service delivery and the fragmentation thesis drives PE-led consolidation.
