Highlights

• RESourceEU Action Plan elevates healthcare to strategic sector status alongside defense and aerospace, unlocking €3 billion in de-risking capital for medical rare earths, isotopes, and closed-loop recycling infrastructure.
• From 2027, the EU bans exporting MRI and CT scanners for processing outside Europe, creating captive feedstock for domestic magnet recyclers like Neo Performance Materials and hydrogen processing innovators like Mkango/HyProMag.
• Winners include:
  • Neo Performance Materials (Estonia magnet plant)
  • Mkango/HyProMag (hydrogen decrepitation IP)
  • Solvay (gadolinium separation)
• OEMs face 20-40% cost increases short-term before recycling scales by 2030.

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The RESourceEU Action Plan marks a structural shift in Europe’s critical raw materials policy by elevating healthcare to the same “strategic sector” tier as defense and aerospace, and it creates a targeted subsidy regime that will reshape profit pools across the medical device and rare earths value chain. While it brings short‑term cost pressure and operational headaches for OEMs such as Siemens Healthineers and Philips, it simultaneously opens a multi‑billion‑euro opportunity for magnet recyclers, chemical processors, and isotope producers positioned to serve a “closed‑loop” European healthcare ecosystem. The companies best placed to benefit are those that already operate EU-based magnet production and recycling assets, control key hydrogen processing IP, or provide high‑value radiopharmaceutical inputs to oncology and nuclear medicine.

From crisis to “strategic” healthcare

RESourceEU is a response to the “Contrast & Magnet Crisis” of late 2024, when shortages of gadolinium and dysprosium exposed Europe’s dependence on Chinese exports for MRI and other imaging technologies. In the new framework, healthcare is explicitly labelled a “strategic sector,” which allows medical applications of rare earths and isotopes to tap into a €3 billion de‑risking capital pool that was previously geared mainly toward energy, EVs, and defense. This fund is designed to bridge the cost gap between low‑priced Chinese materials and higher‑cost European mining and recycling, effectively socializing part of the transition cost in order to build domestic resilience.

The policy does not just aim to add capacity; it attempts to rewire flows. Instead of letting EU hospitals and OEMs rely on imported rare earths and exporting end‑of‑life equipment as scrap, RESourceEU pushes the system towards “urban mining” and closed‑loop recycling of medical hardware and consumables. In parallel, Horizon Europe’s 2025–2027 Health Work Programme is geared to support an innovative, sustainable, and competitive EU health industry that is less reliant on imports of critical health technologies, reinforcing the same strategic direction from the R&D side. Taken together, these strands signal a durable policy shift rather than a one‑off stimulus.

The closed‑loop mandate: how the rules change

The most aggressive change is the prohibition on exporting critical raw materials embedded in “complex medical assemblies” such as MRI and CT scanners for processing outside the EU or designated free‑trade partners from 2027 onwards. Historically, decommissioned MRI units, each containing roughly 500–1,000 kg of NdFeB permanent magnets rich in neodymium and dysprosium, would often be shipped to Asia for low‑value scrap treatment. Under RESourceEU, those magnets must be demagnetised, processed, and either recycled or re‑manufactured within Europe’s regulatory perimeter, creating a captive feedstock base for EU recyclers and processors.

Technically, this is non‑trivial. MRI magnets must first be “quenched” and their liquid helium handled safely before any mechanical or chemical processing can occur. The EU currently lacks large‑scale helium capture infrastructure, and industry voices already flag this “helium bottleneck” as a critical risk: recycling mandates cannot be fully implemented if venting helium remains the default practice. At the same time, RESourceEU explicitly integrates Project HARMONY, which backs hydrogen decrepitation (HD) and related hydrogen processing techniques that can pulverise magnets into reusable powder without acid leaching, preserving rare earth grain structures and meeting Green Deal environmental standards.

Gadolinium, isotopes, and the “hospital mine.”

Beyond magnets, RESourceEU attacks the “gadolinium trap.” Gadolinium‑based contrast agents used in MRI imaging are currently excreted and flushed into wastewater, creating both environmental contamination and a total loss of a strategically important element. The plan earmarks around €150 million for hospital infrastructure that can capture urine from MRI patients for up to 24 hours post‑scan, effectively turning hospitals into small‑scale gadolinium mines whose effluent becomes a recoverable resource. Chemical processors with the ability to separate gadolinium from complex waste streams at an industrial scale will be first in line for these funds.

Healthcare’s new strategic label also extends to nuclear medicine, particularly lutetium‑177, a cornerstone isotope for targeted radiotherapy in oncology. With access to the same de‑risking pool, reactor and processing capacity for Lu‑177 can be co‑funded by the EU, likely depressing long‑term marginal production prices while increasing security of supply for European pharma and radiotherapy centers. This shift redistributes value: commercial isotope producers may see margin compression on commoditised isotopes but stand to gain from higher volume and strategic funding for new facilities and processing nodes.

Who pays: OEMs and hospitals under pressure

In the short term, the cost and operational burden of RESourceEU falls on equipment manufacturers and, indirectly, hospitals. Recycled magnets that comply with EU environmental and content standards currently cost an estimated 20–40% more than virgin magnets sourced from China, raising the bill of materials for MRI and CT scanners. As OEMs reconfigure supply chains, qualify new suppliers, and integrate recycled content quotas, temporary bottlenecks and higher prices for imaging equipment are expected, particularly around 2026–2027 when the new mandates start to bite.

Hospitals, already under budget stress, face a dual challenge: higher capex for compliant equipment and the need to adapt workflows and infrastructure for gadolinium capture and, in some cases, on‑site handling of end‑of‑life magnets. Over time, however, the EU aims for 25% of medical rare earths to come from recycling by 2030, which would reduce exposure to export quotas and price spikes linked to geopolitical tensions. The policy, therefore, trades short‑term inflationary effects for longer‑term supply security and environmental gains.

Neo Performance Materials: the anchor magnet maker

Among publicly listed firms, Neo Performance Materials emerges as a clear early winner. Neo operates a rare earth magnet manufacturing facility in Narva, Estonia, which, as of late 2025, is the only plant inside the EU capable of sintered magnet production ata meaningful scale. The facility, co‑funded by EU Just Transition mechanisms, is designed to supply critical magnets to European automotive, renewable energy, and tech industries, and its role naturally extends to healthcare as RESourceEU channels recycled oxides toward EU‑based remanufacturing.

Under the closed‑loop rules, recycled MRI magnets processed in Europe will require a compliant off‑take route to become new magnets for medical devices, and Neo is positioned as that anchor customer for recycled powders and oxides. The €3 billion de‑risking fund effectively subsidises Neo’s feedstock relative to Chinese competitors by narrowing the cost gap on recycled inputs, supporting both volumes and margins. Market activity already reflects this, with increased trading volume around the announcement window as investors price in the structural European policy tailwind.

Mkango / HyProMag: the hydrogen processing edge

Mkango Resources, via its HyProMag subsidiary, controls key IP around Hydrogen Processing of Magnet Scrap (HPMS), which is effectively the hydrogen decrepitation technology highlighted in Project HARMONY briefings. This process allows magnet scrap from sources such as MRI machines to be broken down into powder in a way that preserves valuable microstructure while avoiding toxic acid baths that would breach EU green standards. Within the RESourceEU framework, HPMS is the de facto reference technology for compliant urban‑mined magnet material.

HyProMag has recently secured a new facility lease in Europe, interpreted in the policy review as a pre‑positioning move ahead of expected RESourceEU innovation grants to scale MRI magnet processing capacity in Germany and the UK. If those grants materialise, Mkango shifts from a speculative rare earth developer to a key gatekeeper in the European medical recycling chain, with upside tied to both license revenues and direct processing margins on high‑value scrap. The risk profile remains high, given execution and funding uncertainties, but the regulatory environment substantially improves the project financeability of HPMS deployment.

Solvay: the chemical heart of gadolinium capture

Solvay’s long‑standing rare earth separation plant in La Rochelle, France, makes it a central candidate to monetise the gadolinium capture push. While magnet recyclers can produce mixed rare earth oxides or powders, only a handful of global players have the industrial solvent extraction circuits to separate gadolinium, dysprosium, and other heavy rare earths from complex feeds at scale, and Solvay sits at the core of that capability in Europe. As hospitals implement urine‑capture infrastructure and magnet recyclers generate increasingly complex scrapstreams, Solvay’s role as a high‑purity separator becomes more valuable.

The €150 million earmarked for gadolinium capture infrastructure, combined with broader CRM Act and Green Deal targets, makes Solvay a likely recipient or partner in demonstration and scale‑up projects for medical waste valorisation. This can translate into expanded throughput, new long‑term contracts with OEMs and hospitals, and a differentiated product line of “EU‑certified recycled oxides” that command a green premium in a bifurcated market. While Solvay’s portfolio is diversified, the convergence of health, environment, and strategic raw materials policy gives its La Rochelle platform a renewed strategic relevance.

The private “HARMONY cohort.”

Beyond listed names, RESourceEU creates a fertile hunting ground for private equity and venture investors focusing on the medical recycling niche. CyclicMaterials, backed by investors such as BMW i Ventures and Energy Impact Partners, positions itself as an “urban mining” specialist explicitly targeting MRI and other large, dangerous magnets that traditional scrap handlers avoid. With export of MRI units for scrap now constrained, hospitals and OEMs need domestic decommissioning partners who can take liability off their balance sheets, and Cyclic is built around monetising that service gap.

In Germany, Heraeus Remloy, part of the larger Heraeus industrial group, already operates magnet recycling lines and is a natural counterpart for German OEMs like Siemens Healthineers. Policymakers view such incumbents as “safe pairs of hands,” making them strong candidates for capacity‑building grants aimed at ensuring reliable domestic recycling routes for hospitals. ITM Isotope Technologies Munich, while primarily a radiopharma company, stands to benefit from strategic‑sector funding for lutetium‑177 production and processing infrastructure, strengthening Europe’s isotopesecurity narrative and increasing the strategic premium on its oncology-linked capabilities.

A new green‑premium asset class

On the trading side, RESourceEU catalyses a “green premium” asset class centered on EU‑certified recycled oxides and magnet materials, which medical OEMs must increasingly procure to meet content mandates. Futures and off‑take contracts tied to these compliant materials command higher prices than generic oxides, reflecting both compliance value and limited supply as recycling infrastructure ramps. Exchanges and specialised platforms dealing in rare earth contracts will need to adapt contract specifications and certification criteria to reflect this new differentiation.

Healthcare’s strategic status also changes how investors price isotope assets. EU‑backed reactors and processing facilities for lutetium-177 and other medical isotopes will likely flatten long-term price curves and reduce geopolitical risk premia, even as they cap upside for high‑cost producers. For pharma and radiotherapy centers, however, lower and more predictable isotope costs reduce treatment volatility and support broader adoption of targeted radionuclide therapies across the Union. In that sense, the value created is not just financial but also clinical, as supply security underpins the expansion of advanced cancer care.

Outlook: who profits from the pivot

Over the next decade, RESourceEU will redirect value from low‑cost overseas suppliers toward a network of European recyclers, processors, and specialist technology providers integrated into a closed‑loop healthcare raw materials system. Neo Performance Materials, Mkango/HyProMag, and Solvay form the backbone of the public market opportunity set, each occupying a distinct but complementary niche in magnet manufacturing, hydrogen processing, and chemical separation. Around them, private actors like Cyclic Materials, Heraeus Remloy, and ITM stand to capture decommissioning, recycling, and medical isotope upside, respectively, with heightened potential for IPOs or strategic M&A in the 2026–2027 window as policy funding and OEM demand crystallise.

For OEMs and hospitals, the transition will feel disruptive, with higher equipment costs, new compliance obligations, and operational changes around waste and decommissioning. Yet once the helium bottleneck is addressed and recycling capacity matures, Europe’s healthcare system is likely to enjoy more robust access to critical materials, reduced exposure to external shocks, and an emerging competitive edge in “green‑compliant” medical devices that meet rising global expectations on sustainability and strategic autonomy.

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