Cracking the US Healthcare Market: A Guide for European Companies

Introduction:

European boardrooms have long viewed the US healthcare market as both irresistible and challenging. It is the world's largest healthcare economy, making up nearly 20% of GDP, and is expected to spend $12,610 per person in the US in 2026. However, it remains notoriously hard for outsiders to understand. Companies are starting to see it differently now. A blend of rising costs, legal reforms, worker shortages, and increased openness to innovation has created what we call an "Efficiency Vacuum." This is a rare moment when European companies offering smarter, leaner, and more interoperable solutions are not only welcomed but also urgently needed.

For European biopharma, medtech, and digital health leaders considering or accelerating their plans to enter the US market, this information is timely. It draws on our combined expertise in US healthcare investment and regulatory guidance to offer a realistic and helpful view of available opportunities and how to leverage them while avoiding costly mistakes.

Healthcare expenses in the US increased by 8.5% in 2025, surpassing even the historically high US inflation rate. This placed significant stress on everyone in the system, from hospital networks to self-insured employers and federal payers. Meanwhile, the country faces a severe shortage of clinical workers that does not seem to be improving anytime soon. New federal drug pricing laws are also beginning to restrict the flexibility that drug companies once had in setting prices.

As a result, the market no longer seeks "more" healthcare. Instead, it is actively looking for "better and cheaper" healthcare and is increasingly open to seeking it abroad. This represents a major change in how European businesses operate. The barriers that once made the US market seem protected are now lower than they have been in the past ten years.

Where European Businesses Have an Edge

Three industries stand out as highly promising for entering the European market in 2026.

1. AI and digital health: European digital health companies, especially those from the Nordic countries, Germany, and the Netherlands, have expanded in areas with limited resources, strict interoperability requirements, and demanding clients in the public health sector. This has resulted in technological stacks that are leaner and more adaptable than those of many US competitors. European firms hold real advantages over their rivals in agentic AI tools that automate healthcare administration, ambient scribing platforms that help doctors keep records, and clinical decision-support systems that can operate across diverse health IT environments.

2. Minimally Invasive Surgery and MedTech: The shift of complex surgeries, like heart and orthopedic procedures, from expensive hospitals to outpatient surgery centers (ASCs) is speeding up across the US. European medtech companies, with expertise in producing minimally invasive tools, implanted devices, and modular surgical systems, are well-placed to support this change. The US hospital system is actively looking for ways to "modularise" care delivery, and European firms have both the technology and clinical proof to back this effort.

3. Long-term care and remote patient monitoring: Germany and Japan have been addressing the "Silver Tsunami," or the increasing number of older adults, longer than the US has. European companies offering scalable home-care systems, remote patient monitoring, and chronic illness management solutions can easily enter the US market, which is just beginning to face similar demographic challenges. These companies have already dealt with issues that the US is still working to solve.

The Policy Landscape: Three Changes That Make Things Easier

There have been three significant changes in policy in 2025 and 2026:

1. Changes to drug prices: The US is moving toward international reference pricing for drugs for the first time through the Most Favored Nation (MFN) framework. This creates a fairer environment for European companies that have traditionally faced stricter pricing rules. A product developed and priced for European markets no longer has the same commercial disadvantage when negotiating prices in the US.

2. Pressure on the Medicare Advantage Margin: US insurers managing Medicare Advantage populations are receiving less reimbursement and are actively seeking value-based care tools—technology and services that reduce long-term costs rather than just increasing clinical capacity. European companies are accustomed to discussing this with national health systems. Value-based procurement is a much more common term in European healthcare markets than it has been in the US system, which tends to focus more on profit-making.

3. The Need for Labour Automation: Due to a shortage of clinical and administrative workers in the US, automation has shifted from being a cost-saving measure to a necessary business strategy. Companies that produce robots in Japan and South Korea, AI platforms in Israel and the UK, and process automation specialists from across Europe are noticing that US health systems, which have historically been hesitant to replace human workers with technology, are now actively seeking solutions. The political debate surrounding this has evolved significantly.

How to Navigate US Laws and Regulations

Regulatory strategy is where many European market entry efforts have historically been stuck. Before entering the US system, those who understand how it works are preemptively rewarded.

One must pay close attention to the FDA's digital health pathway. The 2026 Software as a Medical Device (SaMD) classification framework makes it easier for certain digital health solutions to reach the market. European companies with CE-marked digital health products should consult US regulatory counsel as soon as possible to determine if their current clinical evidence aligns with FDA standards. The overlap is often greater than expected, but the documentation requirements differ significantly in key areas.

We recommend a stepped entry approach for legal and compliance reasons. Instead of hiring a full US executive team before verifying whether your product fits the market, start by engaging a Fractional General Counsel and US-based regulatory advisers. These experts can help you establish your legal and compliance frameworks, understand what investors require, and ensure your contracts and data systems comply with US standards such as HIPAA and the increasingly strict ransomware and cybersecurity requirements now included in health system procurement contracts.

Data localization is not negotiable. Patient data must be stored in the US according to most US health system agreements. Before European companies can engage with US buyers, they need to ensure their cloud and data architecture can comply with this requirement.

How to Enter Without Overreaching

Entry Strategy the most common and costly mistake that European healthcare companies make in the US is launching their products independently before confirming they will sell. The US is not a single market; it's 50 different sets of rules, thousands of payer contracts, and disconnected provider networks. It is usually not advisable to do everything on your own from the beginning.

Strategic collaborations will be the best way to achieve this by 2026. European companies can gain distribution, credibility, and understanding of US regulations without starting from scratch by forming joint ventures with US Physician Practice Management (PPM) groups, collaborating with ASC networks, or acquiring small US companies that already have provider relationships.

Target the middle market first. For most European companies, the top academic medical centers, Mayo Clinic, Cleveland Clinic, and Mass General—are not the ideal initial clients. They take a long time, are politically complex, and require very strong proof of concept. Mid-market regional health systems, however, are actively seeking new ideas, have shorter procurement cycles, and are more receptive to trying out solutions that haven't been validated yet. Succeeding in the middle market provides you with the references needed to connect with the larger players.

Lastly, focus on return on investment rather than clinical outcomes. European healthcare companies are accustomed to using clinical data as their main selling point. US purchasers, especially CFOs and procurement teams at self-insured businesses and health systems, want to know how many bed-days your solution saves, how much administrative work it reduces, and what the net cost impact looks like over a specific period. Before your first sales call in the US, turn your clinical story into a financial model.

The Multi-State Regulatory Aspect

European businesses used to working under a single or unified set of rules might find US healthcare regulations confusing, since they differ from state to state. A corporation that wants to operate in just one US state must follow specific rules. In contrast, a company operating in 20 states faces a patchwork of compliance standards that can change at any time.

Organisations that monitor these changes in advance and build compliance infrastructure early gain a significant cost advantage over those that only react when needed. A single rule change in a major state can overnight shift billing methods, licensing requirements, or the risk of legal violations. European businesses expanding into multiple US markets at once need real-time updates on laws and regulations. It is not a luxury; it is a core business requirement.

The window is open, but not for long. The factors enabling this opportunity—high structural costs, evolving regulations, workforce shortages, and a shift toward value-based procurement—are real and happening now. However, they will not last forever. The window will narrow as U.S. companies adapt, rules stabilise, and the first wave of successful international entrants establishes itself in the market. European healthcare firms entering now, with the right structure, partners, and regulatory approach, will not only access the world's largest healthcare market but also help shape its future and make it difficult for new competitors to gain ground.

The US market has never been easy. But it hasn't been this open to the kinds of solutions that European healthcare companies excel at providing in a long time. The question is not whether you should enter. It is how to do it right.