07.01.06
$1.4 Billion ($41.3B Total)
Key Executives:
Soren Mellstig, President and CEO
David B. Perez, President, Gambro BCT
Lars Granlöf, Senior Vice President and CFO
Jon Risfelt, President, Gambro Renal Products
Maris Hartmanis, Senior Vice President
Åsa Hedin, Senior Vice President, Gambro Strategic Development
Kevin Smith, President, Gambro, Inc.
No. of Employees: 11,000
World Headquarters: Stockholm, Sweden
Blood dialysis giant Gambro Renal Products experienced a relatively flat 2005 against a strong dollar with a 5% increase—just slightly more than $1.4 billion as opposed to a total of $1.4 billion in 2004. In local currency (Swedish Krones), however, Gambro Renal posted an 8% increase due largely to healthy development in the key European markets and good growth in emerging markets.
Last year, and even earlier this year, have been periods of significant change for Gambro, Inc. Through an agreement with El Segunda, CA-based DaVita, Inc., the largest independent provider of dialysis services in the United States, Gambro divested its US dialysis clinics business (Gambro Healthcare US)—thereby reducing the size of the overall corporation by approximately half.
With revenues totaling $1.9 billion in 2004, Gambro Healthcare US represented just over half of total company revenues. When the deal was finalized in October, Gambro netted approximately $3.1 billion—of which $1.3 billion which was distributed to shareholders in accordance with a share redemption program.
Gambro also entered into a strategic partnership with DaVita for research and development of dialysis products. Furthermore, Gambro became DaVita’s preferred supplier of renal products. However, trouble ensued when, in May 2006, DaVita terminated its alliance and supply agreement. The shift resulted after the FDA issued an Import Alert related to a January 2006 warning letter concerning quality issues at Gambro Dasco’s Medolla, Italy manufacturing plant. The Import Alert called for the detention of Gambro’s monitor products—Prisma, Prismaflex and Phoenix—shipped in the United States. Since Gambro Renal Products no longer has the ability to supply HD monitors, DaVita moved to terminate the alliance—however, as of press time, Gambro still has some time to rectify the issue.
At present, the Import Alert has not affected an additional distribution and promotion agreement with Deerfield, IL-based Baxter Healthcare. During 2005, Gambro strengthened its global HD business by granting Baxter exclusive distribution rights throughout Latin America. Following a decision by Baxter to phase out its production of HD monitors, the company chose Gambro to be its exclusive supplier of HD monitors and related disposables. This agreement could enable Gambro to significantly increase HD product sales and offer its product to new customers in the global dialysis market without any major investments.
Revenue growth for Gambro as a whole was healthy enough in 2005, reaching 7% (currency adjusted) gains to total $1.8 billion. This year, the company is looking to take advantage of the fast-growing synthetic dialyzer market as it moves to expand the manufacturing capacity of its Meyzieu plant in France and construct a new plant in Opelika, Alabama. The company also expects to capitalize on the February 510(k) approval by the FDA for the Polyflux 6H pediatric dialyzer, the first to be marketed in the United States.
“Gambro is very excited about bringing this new product to the pediatric market,” said Helene Olefsky, Gambro Renal Products marketing manager. “It provides all of the benefits of Polyflux high-flux dialyzers for use in a pediatric application.”
Gambro’s recent accomplishments are global reaching as well. Last month (in June), Gambro announced it started operations in Lithuania by acquiring 11 clinics with approximately 300 patients. With this acquisition, Gambro will broaden its market presence in the Baltic States and operate in 15 countries, treating approximately 12,000 patients in 160 clinics.
Although Gambro’s Renal Products revenue growth for 2006 is projected between 4% and 7%, the outlook is uncertain due to the FDA Import Alert issue. In March, Gambro submitted a comprehensive Compliance Action Plan (CAP) to the FDA, detailing the specific steps the company will take to resolve the agency’s issues. Regardless, Gambro has assumed that the Import Alert will have a negative effect on future earnings.
Still, the company’s current standing is good for now. First-quarter 2006 sales steadily grew by 7% (currency adjusted) to $481 million. Gambro Renal Products has slowed a bit but managed to climb 3% in spite of the FDA’s Import Alert.
“The underlying business is in good shape and Gambro will continue the efforts to build future growth through development projects seeking acquisitions and cooperation agreements with external parties,” said Soren Mellstig, Gambro president and CEO.
Key Executives:
Soren Mellstig, President and CEO
David B. Perez, President, Gambro BCT
Lars Granlöf, Senior Vice President and CFO
Jon Risfelt, President, Gambro Renal Products
Maris Hartmanis, Senior Vice President
Åsa Hedin, Senior Vice President, Gambro Strategic Development
Kevin Smith, President, Gambro, Inc.
No. of Employees: 11,000
World Headquarters: Stockholm, Sweden
Blood dialysis giant Gambro Renal Products experienced a relatively flat 2005 against a strong dollar with a 5% increase—just slightly more than $1.4 billion as opposed to a total of $1.4 billion in 2004. In local currency (Swedish Krones), however, Gambro Renal posted an 8% increase due largely to healthy development in the key European markets and good growth in emerging markets.
Last year, and even earlier this year, have been periods of significant change for Gambro, Inc. Through an agreement with El Segunda, CA-based DaVita, Inc., the largest independent provider of dialysis services in the United States, Gambro divested its US dialysis clinics business (Gambro Healthcare US)—thereby reducing the size of the overall corporation by approximately half.
With revenues totaling $1.9 billion in 2004, Gambro Healthcare US represented just over half of total company revenues. When the deal was finalized in October, Gambro netted approximately $3.1 billion—of which $1.3 billion which was distributed to shareholders in accordance with a share redemption program.
Gambro also entered into a strategic partnership with DaVita for research and development of dialysis products. Furthermore, Gambro became DaVita’s preferred supplier of renal products. However, trouble ensued when, in May 2006, DaVita terminated its alliance and supply agreement. The shift resulted after the FDA issued an Import Alert related to a January 2006 warning letter concerning quality issues at Gambro Dasco’s Medolla, Italy manufacturing plant. The Import Alert called for the detention of Gambro’s monitor products—Prisma, Prismaflex and Phoenix—shipped in the United States. Since Gambro Renal Products no longer has the ability to supply HD monitors, DaVita moved to terminate the alliance—however, as of press time, Gambro still has some time to rectify the issue.
At present, the Import Alert has not affected an additional distribution and promotion agreement with Deerfield, IL-based Baxter Healthcare. During 2005, Gambro strengthened its global HD business by granting Baxter exclusive distribution rights throughout Latin America. Following a decision by Baxter to phase out its production of HD monitors, the company chose Gambro to be its exclusive supplier of HD monitors and related disposables. This agreement could enable Gambro to significantly increase HD product sales and offer its product to new customers in the global dialysis market without any major investments.
Revenue growth for Gambro as a whole was healthy enough in 2005, reaching 7% (currency adjusted) gains to total $1.8 billion. This year, the company is looking to take advantage of the fast-growing synthetic dialyzer market as it moves to expand the manufacturing capacity of its Meyzieu plant in France and construct a new plant in Opelika, Alabama. The company also expects to capitalize on the February 510(k) approval by the FDA for the Polyflux 6H pediatric dialyzer, the first to be marketed in the United States.
“Gambro is very excited about bringing this new product to the pediatric market,” said Helene Olefsky, Gambro Renal Products marketing manager. “It provides all of the benefits of Polyflux high-flux dialyzers for use in a pediatric application.”
Gambro’s recent accomplishments are global reaching as well. Last month (in June), Gambro announced it started operations in Lithuania by acquiring 11 clinics with approximately 300 patients. With this acquisition, Gambro will broaden its market presence in the Baltic States and operate in 15 countries, treating approximately 12,000 patients in 160 clinics.
Although Gambro’s Renal Products revenue growth for 2006 is projected between 4% and 7%, the outlook is uncertain due to the FDA Import Alert issue. In March, Gambro submitted a comprehensive Compliance Action Plan (CAP) to the FDA, detailing the specific steps the company will take to resolve the agency’s issues. Regardless, Gambro has assumed that the Import Alert will have a negative effect on future earnings.
Still, the company’s current standing is good for now. First-quarter 2006 sales steadily grew by 7% (currency adjusted) to $481 million. Gambro Renal Products has slowed a bit but managed to climb 3% in spite of the FDA’s Import Alert.
“The underlying business is in good shape and Gambro will continue the efforts to build future growth through development projects seeking acquisitions and cooperation agreements with external parties,” said Soren Mellstig, Gambro president and CEO.