2014 med tech R&D budget: $614 million
Change from 2013 budget ($536 million): 14.6%
Percent of 2014 segment sales ($9.67 billion): 6.3%
Stryker ($SYK) is a new addition to this list, which comes as a surprise given its high stature in the industry. But the bigwig is catching up with a 14.6% increase in R&D spending last year, although that's still a relatively low percentage of its overall sales.
In its 2014 annual report, Stryker says R&D spending has increased at a compounded annual growth rate of more than 10% over the past three years.
The company's biggest technological bet is on robotic surgery, due to the acquisition of Mako Surgical for $1.65 billion in 2013. So far, the integration effort has gone more slowly than expected, but RBC Capital markets analyst Glenn Novarro is bullish and projects robotic surgery to account for 11% of hip procedures in two years and 22% in 10 years.
Its plans got a boost earlier this year when the company announced FDA clearance to use the Mako robotic surgery system for total hip replacement. Stryker already uses the Mako to perform partial knee resurfacing and is aiming to get FDA clearance this year to use the device for total knee construction.
Other highlights include a partnership with Samsung unit NeuroLogica to sell a full-body portable computed tomography (CT) scanner. The two companies will market the device for use by surgeons in the fields of neurology, orthopedics and trauma.
In addition, Stryker's Trevo Retriever stent for fighting stroke by physically extracting the clot from the brain got a boost (along with Covidien's Solitaire stent) from groundbreaking studies carried out by independent researchers showing that use of the device enhances outcomes when compared to drugs alone.
Stryker is recruiting 500 subjects for a clinical trial comparing 90-day outcomes of stroke-related mortality in patients who use the stents versus those who receive medication management alone. -- Varun Saxena (email | Twitter)
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