GE HealthCare completes spinout into 'more focused, more agile' standalone company

Fresh out of the 130-year-old nest, GE HealthCare is ready to move fast and break things.

The standalone company made its public trading debut with a bang—or, rather, a ding—after virtually ringing the Nasdaq opening bell from its Waukesha, Wisconsin, manufacturing facility Wednesday. It’s now listed under the ticker symbol “GEHC” and spent its first day on the market climbing about 8% over its $54.30 starting share price.

In an interview with Fierce Medtech after the ceremony, Catherine Estrampes, the president and CEO of GE HealthCare’s U.S. and Canada division, described the spinout as “a catalyst moment for us.”

“It’s really about bringing the best of our GE heritage, while becoming an independent and more focused, more agile company,” Estrampes said.

That faster-moving, more purpose-driven culture, she continued, “will result in faster decision-making, greater integration into the healthcare ecosystem and a greater ability to take calculated risks that may not have been possible as part of a large industrial conglomerate.”

Spinning out of its century-old parent company will also give GE HealthCare “more accountability and focus,” Estrampes said. The company comprises segments that brought in around $18 billion while under the GE umbrella, which will in turn allow the newborn entity to hit the ground running with its investment plans.

Those plans are split between a deep-seated commitment to R&D spending and what Estrampes described as “very disciplined M&A strategy.”

When looking outward, GE HealthCare will focus in part on tuck-in acquisitions of technologies that fit in well with its existing products and markets, she told Fierce Medtech. In the longer term, the company may scope out larger mergers and acquisitions that introduce it to new, adjacent market segments—particularly in “image-guided solutions, workflow efficiencies and therapeutics”—but, Estrampes added, “A disciplined approach to M&A is the word.”

R&D dollars, meanwhile, will be spread across GE HealthCare’s four core segments: imaging, ultrasound, patient care solutions and pharmaceutical diagnostics. High-priority areas the exec singled out include photon-counting imaging technology that can churn out extremely detailed CT scans, as well as handheld and remote ultrasound devices and the Portrait Mobile wearable patient monitoring sensor, which is currently under FDA review.

On top of that, GE HealthCare is also devoting plenty of time and money to artificial intelligence, including “lots of AI-powered and AI-enabled devices to really address the issues that our clients have: the need for increased productivity, increased efficiency and making sure that they can execute on the backlog of the procedures they have,” she said.

Overall, according to Estrampes, GE HealthCare is going solo just in time to capitalize on the influx of opportunities currently available for medtech makers—including opportunities to solve the challenges of the COVID-19 pandemic, an aging population, upticks in chronic disease rates, a growing middle class and healthcare worker burnout and shortages.

“We could not be starting this new journey at a better time,” Estrampes said. “These are exciting times in the healthcare world.”

GE first announced its intent to spin off the healthcare segment in late 2021, when it also laid out plans to eventually separate out its renewable energy, power and digital divisions into another standalone company; the second spinout isn’t slated for completion until early next year. What’s left of General Electric will become GE Aviation.

In the months since announcing the impending creation of GE HealthCare, its parent company tapped Peter Arduini—already the head of the healthcare division since early 2022—to serve as CEO. It also unveiled a new name and logo for the spinoff, complete with a brand-new bicapitalization and a coat of “compassion purple” paint.