The medical technology sector is taking an indirect hit in the ongoing trade war, even though there are no specific U.S. tariffs currently targeting Canadian products. Companies are feeling those effects through higher component costs, supply-chain disruptions and uncertainty about future trade policy. At the Accelerator Centre in Waterloo, early-stage companies are working to turn new health technologies into commercial products. One of them is illumiSonics, which has developed a Multi-Laser Imaging scanner capable of capturing detailed images of tissue, which can assist with detecting cancer earlier and more efficiently. Bringing medical technology to market already comes with significant regulatory hurdles, but industry leaders say tariffs and trade uncertainty will be an added challenge making it more difficult for companies to grow in Canada. “There are many, many tech companies that are affected by tariffs. They do tend to be tech companies that have a physical product,” said Ruth Casselman, CEO of the Accelerator Centre. That includes medical devices and equipment that rely on components crossing the Canada-U.S. border during the manufacturing process. Casselman said some companies already have a workaround for the problem. “We certainly see that people are having to diversify both their supply chains and their customer base,” she told CTV News. The U.S., meantime, remains a critical market for Canada’s medical technology sector. Medtech Canada said the U.S. accounts for 74 per cent of Canadian med tech exports, while about 40 per cent of medical technologies used in Canadian health care come from the U.S. The organization said the uncertainty surrounding trade negotiations is particularly concerning. “The U.S. is conducting a separate Section 232 investigation that directly targets medical technology, and we hope trade relations stabilize before those findings are finalized,” Medtech Canada said, in part, in a statement to CTV News. Building a med tech community The concern coincides with Waterloo’s effort to strengthen its position as a hub for medical technology. Earlier this month, the city announced a $600,000 investment aimed at helping local med tech companies reduce their reliance on the U.S. market. Some of that funding will assist companies working at the Accelerator Centre. “We’re bringing in 45 companies over the next three years with the whole goal of helping them to commercialize their product faster and then to sell it to as many markets as possible,” Casselman explained. Waterloo Mayor Dorothy McCabe said the challenge extends beyond tariffs. She wants to ensure companies that get their start in Waterloo have the resources to remain and grow in the community. “Too often they go to the U.S., particularly San Francisco, because that’s where they can get the venture capital dollars,” McCabe said. “And that’s where they can get their products into the market quickly.” Industry officials say maintaining reliable access to the U.S. market remains important, but the current trade uncertainty highlights the need for Canadian med-tech companies to develop other markets and more resilient supply chains. Medtech Canada said it will continue pushing for uninterrupted market access, arguing that stable trade relationships are critical to ensuring new medical technologies can reach patients as quickly as possible.
