No industry today is perhaps more dynamic, diverse or global than medical device manufacturing. And no where is this assertion better illustrated than in our annual comprehensive look at the world's leading device companies-a report on the top 30 corporations.
This is MPO's third report on the market leaders, and much has changed over the past three years. Consolidation and acquisitions are routine occurrences in any market, but even astute observers of the medical device industry need scorecards these days. The pace of change is simply astounding as companies merge, launch new businesses, divest non-essentials and embark on aggressive growth programs. Moreover, a number of companies saw important leadership changes that could profoundly alter its culture and future.
TOP MEDICAL DEVICE MANUFACTURERS | ||
1. | Johnson and Johnson | $15.6B |
2. | GE Healthcare | $11.3B |
3. | Baxter International | $9.5B |
4. | Medtronic | $9.1B |
5. | Tyco Healthcare | $9.1B |
6. | Siemens Medical Solutions | $8.7B |
7. | Philips Medical Systems | $8B |
8. | Boston Scientific | $5.6B |
9. | Stryker | $4.3B |
10. | B. Braun | $3.8B |
11. | Guidant Corp. | $3.8B |
12. | Zimmer Holdings | $3B |
13. | Becton, Dickinson & Co. | $2.7B |
14. | Kodak Health Imaging | $2.7B |
15. | Hospira | $2.6B |
16. | Smith & Nephew | $2.4B |
17. | St. Jude Medical | $2.3B |
18. | Fresenius | $2.2B |
19. | 3M Healthcare | $2B |
20. | Cardinal Health | $1.9B |
21. | Alcon | $1.8B |
22. | Synthes | $1.8B |
23. | Bausch & Lomb | $1.7B |
24. | C. R. Bard | $1.7B |
25. | Dentsply International | $1.7B |
26. | Terumo | $1.7B |
27. | Biomet | $1.6B |
28. | Dräger Medical | $1.5B |
29. | Invacare | $1.4B |
29. | Gambro | $1.4B |
As you read through our report, several key trends become abundantly clear. New products-not just different iterations of existing lines-are the key to real growth. Items such as coronary stents, ceramic-on-ceramic implants, ICDs and others have helped some device manufacturers post eye-popping results. This is the importance of R&D spending, and insightful executives understand this type of investment is critical to future growth.
Another trend you'll notice is the potential of international markets. While the U.S. continues to offer growth opportunities like no others, some regions have become important as well. Specifically, developing areas such as China, Eastern Europe and Latin America all offer growth paths for companies who have tapped out their domestic markets. Of course this requires different kinds of investments-in perhaps joint ventures, acquisitions or some other partnerships.
One more observation: legal entanglements have increasingly become a way of life for medical technology companies-whether it's a patent dispute, an investigative inquiry or regulatory enforcement actions. Many of the top companies here face multiple legal disputes that can have a long-term impact on their businesses.
Despite all the challenges medical device manufacturers face, the rewards are well worth it. At a time when many other industries are operating at razor-thin margins-just ask hospital administrators, the customers-most of the companies profiled in this report managed to report very healthy revenue and earnings growth. And the outlook for the future is equally robust.
A note: companies are ranked according to estimated device sales they report for their fiscal or calendar year in 2004. Some may include non-medical sales within a division, such as injectable drugs or combination products. If a division's primary business is medical devices, then we list sales for the entire division. Unfortunately, even the companies themselves sometimes are unable to provide us with an exact breakdown of device and non-device components. Additionally, sales for foreign-based companies are converted to dollars using the exchange rate on the last day of their reporting period.
We hope you find this report helpful. As always, we invite your feedback on ways to make improvements for next year.
The MPO Staff