Special Report—The top companies in medtech by 2016 revenue

diabetes tools
Medtronic, Johnson & Johnson, Philips, Abbott, Siemens, Stryker, Roche, Becton Dickinson, GE Healthcare and Boston Scientific are the top companies in medtech by 2016 revenue.

2016 was the year of the makeover.

The top 10 medtech players are all in varying stages of transformation. Some companies, like Philips and Siemens, are well into their metamorphoses, while others, such as Boston Scientific and Johnson & Johnson, made moves to overhaul their medtech businesses. Others still are digesting large acquisitions from years prior and are casting about for new sources of growth. This report is based on data from life science intelligence firm, Evaluate.

Siemens Healthcare rebranded as Healthineers in 2016, following a restructuring that broke it out as a separate business and included promises to bolster its existing offerings while also adding new ones. And it seems to be working—while Healthineers posted just 1% growth in 2016, this was a marked improvement over the 18% decline in medtech sales the previous year. While Siemens planned to publicly list Healthineers at the end of 2016, it has since backtracked on that idea, saying it would retain a majority stake in the company if it goes public.

Early in the year, an analyst mused that GE may sell off its diagnostics and life sciences businesses after the company made a push toward heavy-duty machinery. But GE shut the rumors down and is looking to emerging markets for growth in the healthcare space.

Philips also refocused; it finally spun off Philips Lighting and sold off its Lumileds division, allowing it to “beef up” its HealthTech business. The company was on a roll in 2016, making deals and partnerships to expand its presence in digital health, remote monitoring and medical imaging analytics. Boston Scientific also announced a global restructuring scheme midyear, but it didn’t share details other than that it would complete most of the reorg by 2018.

Johnson & Johnson is undergoing an overhaul after a 9% slump in medtech growth in 2015. It started 2016 by cutting 6% of its medtech employees in a restructuring aimed to restore the lumbering company to growth. J&J weathered pressure from investors to split its faltering device and consumer units from its better-performing pharma business but stuck to its guns and ultimately reported flat medtech sales for 2016. While J&J mulled “strategic options” for its diabetes device businesses early this year, it will stay in the diabetes arena with surgical tools and diabetes drugs.

Roche, another player with a strong pharma business, is trying to reinvigorate its diabetes unit, which has been struggling thanks to payer pressure in the U.S. Unlike J&J, which is thinking about a sale, joint ventures or operating partnerships, Roche is actively seeking deals to boost diabetes, and is working on a long-term “artificial pancreas” system with Senseonics and TypeZero Technologies.

Medtronic, still processing its $50 billion Covidien acquisition, is looking to reap results from a handful of smaller deals it made in 2016. In the longer term, it will log sales from its newly launched “artificial pancreas,” based on its MiniMed 670G insulin pump.

Meanwhile, Stryker had an acquisitive year, which saw new additions to its MedSurg business as well as to its Spine division, which is one of its smaller units. In addition to M&A, the orthopedics player is looking to innovations in 3D printing and robotic surgery for growth.

Becton Dickinson reported its first full year “as the new BD,” having digested its $12 billion CareFusion buy. The devicemaker reported two straight years of at least 25% growth and will transform again, having just inked a $24 billion deal to acquire C.R. Bard.

Finally, Abbott also has a transformative couple of years ahead—it closed its $25 billion acquisition of St. Jude Medical just after fiscal 2016 concluded and has since launched some products picked up in the deal. And now that it has agreed on new acquisition terms with Alere, it looks like that deal, now valued at about $5.3 billion might just go through. - Amirah Al Idrus, @FierceMedTech

  1. Medtronic
  2. Johnson & Johnson
  3. Philips
  4. Abbott
  5. Siemens
  6. Stryker
  7. Roche
  8. Becton Dickinson
  9. GE Healthcare
  10. Boston Scientific

*This top medtech revenues list is based on data provided by EvaluateMedtech, which represents each company’s fiscal year. These fiscal years may or may not be the same. Sales for companies whose fiscal years that end in the first half of the year—such as Medtronic’s, which ended in April 2017—will be attributed to the prior year, 2016.

Adjustments have been made to derive the medtech revenues at the conglomerates with the definition of "medtech revenue" including medical devices and diagnostics. Breakdowns are provided for Philips, GE Healthcare and Becton Dickinson.

Data: Source: Evaluate Data Kit, Pharma, Biotech, MedTech, May 2017, Evaluate Ltd, www.evaluate.com

Special Report—The top companies in medtech by 2016 revenue