CEO: François van Houten
Based: Amsterdam, The Netherlands
2015 sales: $8.96 billion
2014 sales: $8.9 billion
Royal Philips ($PHG) is digging in to make its HealthTech refocus that dates back to 2014 a reality that translates into real sales growth. From a sales decline in 2014, the conglomerate eked out a bit of sales growth in 2015. And it's aiming for routine mid- to high-single-digit annual sales growth. It did so in the first quarter, with its HealthTech businesses rallying with 5% sales growth.
The main stumbling block for Philips going forward is efficiently dispensing with its lighting business, which has been hovering in limbo for a few years now. Most recently, Philips has said it will do an IPO for its Lighting business, and it expects to announce a plan for the disposal of its Lumileds business, which includes automotive lighting, during the second half of 2016. A deal for the acquisition of Lumileds by a Chinese company fell through last year
According to various reports on the valuations of the businesses, getting these deals done could free up as much as $10 billion in cash for Philips. That would give it a lot of dry powder to redeploy potentially in the name of HealthTech. But it doesn't look like Philips will benefit from either of these deals getting done until at least 2017.
Philips is the only major conglomerate that encompasses med tech that's taken an active, strategic view on the massive changes and influences accumulating in the sector including, but not limited to, digital health, at-home care, consumer monitoring, machine learning and genomics.
It's brought on aeronautics industry exec Jean Botti as chief innovation and strategy officer in an effort to seriously rethink how technology is integrating healthcare.
Summed up François van Houten in an interview with FierceMedicalDevices, "It is a very complicated system where all the parts collaborate as well as with humans, the pilot but also with the ground station. Think of it as a very complex cloud-based systems approach where quality is of the utmost importance, where data analytics is in real time and everything works. Now I realize of course that aeronautics is not the same as healthcare, but I do believe that what we need in terms of system integration, data analytics and collaboration is that we need such a systems approach."
"To make a step change versus the traditional product and device approach, you need to maybe oversteer a bit and look for different capabilities," continued van Houten. "Jean is the pioneer of the electrical airplane, so he is at the forefront of innovation. He is also a pioneer of embedding sensor technology to measure everything, including the pilot's behavior in the cockpit. It's this type of applied technology that I think will help us support patients that are critically sick. Maybe also to remotely support doctors and taking care of more patients in real time."
-- Stacy Lawrence (email | Twitter)
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