OBJECTIVES: This study evaluates the impact on market dynamics of applying existing Health Technology Assessment (HTA) methodologies to medical devices. METHODS: Using a case study on drug-eluting stents (DES), we examine whether the economic characteristics of medical devices introduce particular challenges to the application of HTA and whether the experience of DESs suggests directions for policy formulation. RESULTS: The case study found a market that encourages rapid competition, leading to value for the end user though price competition.  The application of existing HTA methods has the potential to disrupt this dynamic and reduce the rewards of medical devices to innovators - through higher evidence requirements on initial entrants and market dynamics that subsequently drive a reduction in prices. A cycle of price reductions results because the comparator price of the old technology is reduced as a consequence of ‘disinvestment’ following the first recommendation in favour of the innovation, and then subsequent entrants’ prices are reduced through procurement competition as well as their lower likely required R&D investments. CONCLUSIONS: The study finds that HTA decisions on medical devices can have a material impact on the market dynamics (and so prices) following a recommendation, because of the manner in which medical devices are procured.  The findings of HTA will therefore vary depending on the point in time when it is undertaken, as relative prices change substantially over time.  Re-reviewing cost-effectiveness, without any new clinical evidence, relative to a technology that has had a ‘disinvestment recommendation’ would therefore appear perverse, as it sets up a feedback loop that causes a perpetual downward spiral in prices.  The study raises a number of policy issues for consideration.  These include the interplay between different drivers of value in HTA and procurement, and the implicit ‘genericisation’ of evidence through the procurement process.