Philips to invest $150M in U.S. medtech manufacturing, expand Pennsylvania and Minnesota sites

Philips investing in U.S. medtech manufacturing: ©Philips

Philips announced Thursday it will invest more than $150 million in U.S. manufacturing and research and development, including expanding its Reedsville, Pennsylvania, facility that produces AI-enabled ultrasound systems for hospitals nationwide.

The investment builds on the company’s annual $900 million R&D spending in the U.S. and support for nearly 17,000 employees at 40 facilities across the country. Philips says its products are used by clinicians and patients in 90% of U.S. hospitals.

The new funding covers the Reedsville expansion, a recently announced expansion of its Image Guided Therapy facility in Plymouth, Minnesota, and additional manufacturing and R&D projects planned over the next several years to bolster the company’s U.S. growth.

In Reedsville, Philips plans to add 24,000 square feet of manufacturing space and 40,000 square feet of warehouse space, creating 120 skilled manufacturing jobs. The site currently produces transducers but will also begin customizing ultrasound software and configurations for cardiovascular, general and maternal care procedures. The company’s CV ultrasound platform, for example, is designed to help doctors diagnose structural heart and coronary artery disease more quickly and accurately.

“The proposed planned expansion of our manufacturing facilities is a demonstration of our deep commitment to the U.S. region,” said Jeff DiLullo, chief region leader, Philips North America. “Increasing our manufacturing and R&D capabilities will create jobs and accelerate our ability to deliver better care for more people with innovative AI-enabled solutions.”

The Plymouth expansion will include a new medtech training center and is expected to create more than 150 new jobs.

Broader trend: AI and medtech manufacturing growth in the U.S.

Philips’ move comes as the U.S. medical technology sector experiences rapid growth in AI-driven imaging and minimally invasive treatment solutions. Hospitals and health systems are increasingly adopting advanced diagnostic tools that integrate artificial intelligence to speed up image interpretation, support earlier detection of disease and improve workflow efficiency for clinicians.

Ultrasound systems, once limited to basic imaging, are now being paired with AI algorithms that can automatically detect abnormalities, guide procedures in real time and even personalize settings for specific clinical needs. This shift has been driven by rising demand for faster, more accurate diagnoses and the need to address workforce shortages in health care.

On the manufacturing side, medtech companies are localizing more production in the United States to strengthen supply chain resilience and meet regulatory and logistical challenges. Domestic R&D investments are also rising, with a focus on integrating software, cloud connectivity and AI capabilities into medical devices.

Industry analysts say the combination of AI innovation, domestic manufacturing expansion and increasing clinical demand for precision medicine will likely keep driving similar investments from other major medtech companies in the coming years.