A new report from Menon Economics provides an updated overview of the Norwegian health industry, with a particular focus on export developments leading up to 2030. Despite growth in revenue and exports, the industry faces significant challenges related to profitability, research, production, and international market access.
While export revenues have increased to NOK 29 billion in 2024, growth remains concentrated among a few large players. At the same time, the report highlights a decline in research, patents, and industrial production, which could weaken the industry’s long-term competitiveness.
Industry Growth, but Declining Profitability
The Norwegian health industry generated NOK 76 billion in revenue in 2023, with an average annual growth of seven percent since 2014. The sector now employs 13,300 people and contributed NOK 22 billion in value creation.
However, despite growth, profitability has declined. The operating margin was 9 percent in 2023, down from 12 percent between 2014 and 2019. This decline is attributed to rising costs, increased competition, and a weak Norwegian krone, which has driven up import expenses for the industry.
Exports Are Increasing, but a Few Companies Dominate
The export value of Norway’s health industry has risen significantly, from NOK 19 billion in 2018 to NOK 29 billion in 2024. Between 2021 and 2023, exports grew by NOK 5 billion, a 23 percent increase over two years.
Despite this growth, exports are highly concentrated. In 2021, the eight largest exporters accounted for 78 percent of total exports, a share that increased to 88 percent in 2023. This makes the sector vulnerable—should one or more of these major players relocate production abroad, it could significantly impact industry size and export capacity.
Additionally, part of this export growth is linked to currency fluctuations. Between 2021 and 2023, the U.S. dollar appreciated by 23 percent against the Norwegian krone, while the euro strengthened by 12 percent. This means that a portion of the nominal export growth can be attributed to exchange rate effects rather than increased production volume.
Research and Industrial Production Under Pressure
The report highlights several challenges related to research and industrial production. Both R&D investment and patent registrations have declined in recent years, which could weaken the industry’s innovation capacity.
- The number of SkatteFUNN-supported R&D projects in the health industry has fallen by 17 percent from 2021 to 2023.
- The number of health-related patents has also dropped significantly since 2021.
Industrial production is also decreasing. In 2020, there were 60 companies engaged in industrial production, but by 2024, that number had dropped to 37. While part of this decline could be due to changes in survey methodology, Menon Economics suggests that it also reflects a real reduction in industrial production capacity in Norway.
International Presence and Export Challenges
Many Norwegian health companies have international ambitions but face challenges in export markets. 38 percent of health industry companies have subsidiaries abroad, primarily in the Nordic region and Europe, though interest in the U.S. and Asia is growing.
However, companies report several obstacles to international expansion:
- Many lack access to export credit and distribution networks abroad.
- The cost of maintaining a presence in export markets is high.
- Limited support from government agencies and Norwegian embassies in export markets.
For smaller companies, these challenges can be a major barrier, particularly in health technology, where regulatory requirements and market entry hurdles are significant.
Capital Access and Investments
Access to capital is crucial for health industry growth and international expansion. The report shows that many companies have sought external financing in recent years:
- 71 percent of companies applied for new equity capital in the past two years, and 92 percent successfully secured funding.
- 70 percent of capital came from Norwegian investors, while 30 percent was foreign.
Although some foreign investors have shown interest in the Norwegian health industry, there have been few major acquisitions in recent years.
The Role of Health Clusters
The report emphasizes that health clusters play a key role in connecting companies to international markets, investors, and regulatory processes. Several of Norway’s leading clusters, including Norway Health Tech, Oslo Cancer Cluster, The Life Science Cluster, and Smart Care Cluster, contributed to the report and actively support export growth.
These clusters serve as networking platforms for companies looking to commercialize new technology, secure investors, and establish themselves in export markets.
What Is Needed to Reach Export Goals?
To achieve the target of NOK 50 billion in annual exports by 2030, the report highlights several areas that require action:
- Increased investment in research and innovation, including more patents and better R&D financing.
- Retaining industrial production in Norway to ensure value creation and job security.
- Strengthening export support programs, including better access to export credit and international networks.
- Attracting international talent, as 60 percent of companies anticipate a growing need for foreign expertise by 2030.
About the Report:
The report was prepared by Menon Economics on behalf of a broad group of stakeholders from the health industry and innovation ecosystem, including:
Innovation Norway, NHO, Abelia, IKT-Norge, Industri Energi, LMI, The Norwegian Directorate of Health, The Research Council of Norway, Inven2, Oslo Science City, Aleap, Oslo Cancer Cluster, Norway Health Tech, The Life Science Cluster, Smart Care Cluster, HelseOmsorg21-monitor, and WIPO.
This broad coalition of industry, public sector, and research institutions underscores that the health industry is a strategic priority for Norway’s future export and economic development.
📄 Read the full Menon report here (norwegian):
Health Industry Exports – A Baseline Analysis with Input and Performance Indicators