Russia-Ukraine war: Siemens, J&J vow to continue serving all patients while Conformis freezes Russian sales

Russia’s invasion of Ukraine has sent shockwaves through global financial markets and business operations, compounded by sanctions that countries in the U.S., Europe and elsewhere have levied on the aggressor.

On top of governmental sanctions, many companies have announced individual decisions to halt operations within and sales to and from Russia, according to a report from Reuters. They span the world’s largest industries, from oil giant ExxonMobil to global bank HSBC to tech monolith Apple. Now, some medtech companies are following suit.

Wednesday, customized orthopedic implant maker Conformis said it would freeze all distribution to Russia and other entities based in the country and would stop pursuing new business opportunities in the region. The decision to step back came shortly after Massachusetts-based Conformis launched a new distribution agreement in Russia, CEO Mark Augusti said in a statement.

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“While we were looking forward to working with our agents and surgeons in Russia, we believe it is important that our business aligns with our values,” Augusti said. “We will monitor this closely and look to resume development when appropriate.”

“We feel empathy for the Russian people and potential patients of Conformis, who may have benefited from our products," he said. "However, given the unnecessary and unprovoked military invasion of Ukraine instigated by the Russian leadership, we can no longer in good conscience, sell our products or services in the Russian market.”

Augusti went on to urge the company’s fellow international businesses to follow suit and sent “thoughts and prayers” to Ukraine, singling out any relatives of Conformis employees residing there.

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Elsewhere, in a statement sent to Fierce Medtech, Siemens Healthineers said that while it would comply with all export control requirements and sanctions, it would also continue to support healthcare providers and patients in Russia, citing the right to medical care embedded in the Universal Declaration of Human Rights. It also noted that it expects “an indirect negative impact on our business” due to financial sanctions, which don’t directly target the healthcare industry.

“As a medical technology company, our priority remains to support medical professionals and patients in every circumstance and in every country. We believe that sanctions should not have adverse humanitarian consequences for the civilian population and hope we will be able to continue to support those who need us in both Ukraine and Russia,” the company said.

“Siemens Healthineers strongly condemns the invasion by Russian forces of Ukraine, a sovereign European nation, in clear violation of international law. We are moved by the courage of the Ukrainian people.”

Johnson & Johnson took a similar approach. In a statement sent to Fierce Medtech, it said, "Our priority is the safety of our employees and their families who are affected, and we are supporting them in every way we can. We are also committed to ensuring that our essential medical products will reach the people who need them within the region. We are monitoring the changing situation as well as the degree of impact on our business."

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According to a report from the U.S. commerce department’s International Trade Administration, the market for medical equipment in Russia totals more than $5 billion.

As of 2018, nearly 20% of that market was dedicated to diagnostic imaging, while consumables took up 15% and patient aids clocked in at 14%. Dental products and the orthopedics and prosthetics segment each made up about 9% of the market, and the remaining third of the market came from “other medical devices.”

The report notes that many of the world’s largest medical device makers have a presence in Russia, including Johnson & Johnson, GE Healthcare, Medtronic, Baxter, Stryker, Philips and Siemens Healthineers plus its now-subsidiary Varian Medical Systems.