<p>➀ The EU AI Act imposes stringent requirements on AI-based medical devices, combining existing Medical Device Regulation (MDR) mandates, especially impacting Germany’s SME-dominated MedTech sector and startups;</p><p>➁ Challenges include high regulatory compliance costs, documentation burdens, and limited resources for SMEs, while ensuring patient safety demands robust data governance and human oversight for high-risk AI systems;</p><p>➂ The paper advocates for coordinated regulatory frameworks, real-world testing environments like sandboxes, and expanded access to healthcare data (e.g., European Health Data Space) to foster innovation and maintain Europe’s competitiveness.</p>