MassDevice Releases 2019 Global Top 10 Medical Device Companies List

Recently, MassDevice, an authoritative third-party website for medical devices abroad, released the "2019 Global Top 100 Medical Devices" list, which is based on revenue statistics from the 2018 fiscal year.The list shows that mergers and acquisitions and expansion are reshaping the rankings of the world’s top medical device companies.

Overall, the top 100 global medical device companies reported sales of $397.5 billion in the most recent fiscal year, representing a 3.5% increase from the previous year.As corporate consolidation continues, smaller companies have fallen to the bottom of the list. Ranked 100th this year is RA Medical Systems, with annual revenue nearing $6.3 million.

Below is the list of the top 10 global medical device companies in 2019. Notably, apart from Medtronic, Johnson & Johnson, and Philips in the top three, and Danaher at eighth place, the rankings of the remaining companies in the top 10 have all changed.

No. 10: EssilorLuxottica

2018 Revenue: $12.761 billion

R&D Expenses: $2.245 billion

Employees: 150,000

Average Employee Income: $85,075

Fiscal Year End: December 31, 2018

Last Year's Ranking: 15

EssilorLuxottica was established last October following the merger of French lens specialist Essilor and Italian eyewear manufacturer Luxottica,Became the world’s largest eyewear manufacturer at a price of €54 billion. Through mergers and acquisitions, it leaped from 15th place among global medical device companies into the top ten.

Following the merger, EssilorLuxottica employs nearly 150,000 people and reports annual consolidated revenue of approximately US$12.8 billion. EssilorLuxottica is seeking to further consolidate its dominance in the eyewear market.Announced this summer, the plan is to spend billions of dollars to acquire Grandvision and its 7,200 optical stores worldwide.

#9: Stryker

2018 Revenue: $13.6 billion

R&D Expenditures: $8.62 billion

Employees: 36,000

Average Employee Income: $377,778

Fiscal Year End: December 31, 2018

Last Year's Ranking: 10

The world’s largest orthopedic device company has maintained strong momentum this year. In 2018, its profits more than tripled to reach $3.6 billion, while sales rose by 9.3% to $13.6 billion.Stryker’s senior management believes that the company has consolidated its position in the spine market through the integration of K2M, which it acquired in November 2018 for approximately $1.4 billion. Demand for Stryker’s Mako system for robot-assisted knee and hip surgeries also remains strong.

Stryker analysts wrote at the AAOS annual meeting in March that Mako remains the best in its class amid an expanding product portfolio. This month, Stryker announced it would acquire Mobius Imaging and its Cardan Robotics subsidiary in an all-cash deal valued at $500 million, further solidifying its early leadership position in the robotics field.

No. 8: Danaher

2018 Revenue: $15.574 billion

Fiscal Year End: December 31, 2018

Last Year's Ranking: 8

Danaher’s sales operations are primarily divided into four segments: Life Sciences, Diagnostics, Environmental & Applied Solutions, and Dental, with the Life Sciences and Diagnostics businesses accounting for a significant proportion of its revenue.In 2018, Danaher achieved an operating revenue of US$19.893 billion, a year-on-year increase of 8.53%.Data shows that after experiencing a negative growth in 2014, Danaher's operating revenue maintained substantial growth. Starting from 2017, the growth rate slowed down to 8.57%, and it remained roughly flat in 2018.

Danaher remains on track to spin off its dental business into a publicly traded company named Envista by year-end.The dental business produces dental restorative products, orthodontic bracket systems, and more. Meanwhile, it is also advancing its planned $21 billion acquisition of General Biopharmaceuticals.

#7: Cardinal Health

2018 Revenue: $15.633 billion

Employees: 49,500

Average Employee Income: $315,818

Fiscal Year End: June 30, 2018

Last Year's Ranking: 6

Cardinal Health, the leading player among the “Big Three” U.S. pharmaceutical and medical device distributors and ranked sixth globally among medical device companies in 2018 with annual revenue of $13 billion, officially updated its Chinese brand name to “Jiadenou” in China this March.

Cardinal Health still has much work to do in its medical business segment. In the company’s most recent fiscal year ended June 30, revenue for this segment remained flat while profits declined.It has been four years since Cardinal Health acquired Cordis, the stent, balloon, and other interventional cardiology product manufacturer, from Johnson & Johnson for $1.94 billion, yet the company continues to grapple with challenges associated with the business.

CEO Mike Kaufmann stated during an August earnings call that Cordis is on a path to profitability, citing emerging growth in performance across many regions, along with improvements in fill rates and backorders.Cardinal Health has recently introduced a new sales structure for its medical business and is undergoing a lengthy process to transform its manufacturing, supply chain, and data capabilities.

Kaufman stated that the current focus is on execution and mergers and acquisitions surrounding product acquisitions. In August, the company promoted Stephen Mason, former president of the Cardinal Health at Home Solutions business, to chief executive officer of its medical division.

No. 6: Siemens Healthineers

2018 Revenue: $15.864 billion

R&D Expenditures: $1.514 billion

Employees: 50,000

Average Employee Income: $317,286

Fiscal Year End: July 30, 2018

Last Year's Ranking: 7

Siemens Healthineers is one of the medical device companies making significant strides in the field of surgical robotics.This August, it was reported that the company’s Siemens Healthineers subsidiary plans to spend $1.1 billion to acquire Corindus Vascular Robotics, the manufacturer of the FDA-approved CorPath GRX vascular robotic system.CEO Mark Toland stated at the time that the deal would combine the company’s precision robotics technology with Siemens Healthineers’ imaging, digital, and artificial intelligence tools.

Siemens Healthineers is a leading manufacturer of medical imaging systems, including computed tomography (CT), magnetic resonance imaging (MRI), molecular imaging, X-ray, and ultrasound. The company also produces angiography systems, mobile C-arms, and hybrid operating rooms for image-guided therapy, as well as diagnostic testing systems. Other services include software solutions and clinical consulting.Siemens Group’s 2018 Annual Report shows that the company’s R&D efforts place particular emphasis on artificial intelligence.Company executives believe that artificial intelligence can improve the processing of medical information, uncover hidden patterns, and facilitate better clinical decision-making. For the fiscal year ended September 30, 2018, Siemens Healthineers reported a slight decline in both revenue and profit.

#5: Fresenius

2018 Revenue: $19.554 billion

R&D Expenditure: $158 million

Employees: 50,000

Average Employee Income: $317,286

Fiscal Year End: December 31, 2018

Last Year's Ranking: 3

Fresenius Medical Care is the world’s largest medical device company in the field of chronic kidney disease care, providing dialysis products and services to more than 300,000 patients worldwide. The company has become a leader in the global dialysis market.

The most significant news regarding Fresenius is that,In February this year, the U.S. Federal Trade Commission approved the merger between Germany's Fresenius and the U.S. home dialysis equipment manufacturer NxStage Medical Inc.The U.S. Federal Trade Commission stated that, to secure approval for the $2 billion transaction, the two companies agreed to divest NxStage’s bloodline tubing set business.

In July 2019, the company’s stock suffered a severe setback amid news that the Trump administration planned to overhaul the kidney treatment market in an effort to reduce the federal government’s annual $100 billion expenditure on kidney care.This strategy involves a new payment model from the U.S. Department of Health and Human Services, aimed at shifting patients from Fresenius’s hemodialysis clinics to home-based treatment; the Department also plans to increase prevention and screening for kidney disease. In 2018, Fresenius’s net income rose 55% to €1.98 billion, while sales declined 7% to €16.55 billion.

No. 4: GE Healthcare

2018 Revenue: $19.784 billion

Fiscal Year End: December 31, 2018

Last Year's Ranking: 5

GE Healthcare has yet to achieve an independent public listing after a turbulent year. In June 2018, it announced its intention to sell a 20% stake, with reports indicating that by January of the following year, it would consider a larger divestiture of up to 49.9%.

But in February, new CEO Larry Culp proposed spinning off the healthcare business so that the industrial conglomerate could focus on its $21 billion biopharmaceutical sales. Larry Culp was hired in October 2018 to design a turnaround plan. This June, GE was reportedly buying out its venture capital portfolio, which includes more than 100 startups in the healthcare, technology, and energy sectors, in an effort to manage its $110 billion debt burden.

GE Healthcare’s full-year 2018 profit rose 6.0% to $3.70 billion, while sales increased 4.0% to $19.78 billion,Meanwhile, the parent company's full-year net loss widened by 155.6% to -$22.80 billion, while sales increased by 2.3% to $113.54 billion.

No. 3: Philips Healthcare

2018 Revenue: $21.414 billion

R&D Expenditures: $2.08 billion

Employees: 77,400

Average Employee Income: $317,286

Fiscal Year End: December 31, 2018

Last Year's Ranking: 3

Philips Healthcare underwent a restructuring in January this year, moving its Sleep and Respiratory Care business from Personal Health to the new Connected Care business unit, and transferring Medical Informatics to the Diagnosis & Treatment segment. Under the new organizational structure, Philips operates three business units: Diagnosis & Treatment, Connected Care, and Personal Health.

Full-year 2018 profit declined 41.3% to €1.1 billion, or €1.75 per share, while sales increased 1.9% to €18.12 billion.

This year, Philips Healthcare also made several acquisitions, including Direct Radiology, a developer of teleradiology platforms; the imaging IT business of Carestream Health; Xhale Assurance, a manufacturer of pulse oximetry sensors; and Medumo, a Boston-based patient navigation platform. The financial terms of these acquisitions were not disclosed.

In June 2019, Philips opened a new R&D center in Rochester, Minnesota, to enhance its collaboration with the Mayo Clinic.

#2: Johnson & Johnson Medical

2018 Revenue: $26.994 billion

R&D Expenditures: $1.764 billion

Employees: 77,400

Average Employee Income: $317,286

Fiscal Year End: December 31, 2018

Last Year's Ranking: 2

In 2018, Johnson & Johnson’s medical device business generated $26.964 billion in revenue, with growth slowing to a year-over-year increase of 1.5% (compared to a 5.6% year-over-year increase in 2017).Double-digit growth in the cardiovascular and ophthalmology businesses, along with single-digit growth in the surgical business, were offset by a 37.5% decline in the diabetes care business.

Johnson & Johnson Medical entered one of the hottest fields in medical technology this year, spending $3.4 billion on Auris Health and its Monarch robotic-assisted bronchoscopy platform, supplementing its robotic-assisted general surgery program with Verb Surgical and orthopedic surgery, and acquiring an orthopedic platform.

Johnson & Johnson Files Complaint Against Robotic Surgery Pioneer Intuitive Surgical; U.S. International Trade Commission Agrees to Review, Alleging Intuitive’s Imported Surgical Stapler Cartridges Infringe Five J&J Patents

Johnson & Johnson continues to restructure its medical device division, executing two divestitures: selling its advanced sterilization products business to Fortive for $2.8 billion, and selling its Lifecan blood glucose monitoring subsidiary to Platinum Equity for $2.1 billion.

According to U.S. Legal News, the first lawsuit filed by a state attorney general over pelvic mesh products has gone to trial, alleging that Johnson & Johnson’s subsidiary Ethicon concealed the potential risks of these products from the public and physicians. In April, Johnson & Johnson settled a similar case in Washington for $10 million, and Kentucky is also suing Ethicon.And most of the remaining metal-on-metal hip cases facing its subsidiary, Depuy Synthes, are likely to be settled for approximately $1 billion.

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#1: Medtronic

2018 Revenue: $30.557 billion

R&D Expenditures: $2.33 billion

Employees: 90,000

Average Employee Income: $339,522

Fiscal Year End: April 26, 2019

Last Year's Ranking: 1

This year, Medtronic made a significant entry into the orthopedic robotics market with its $1.7 billion acquisition of Mazor Robotics, and briefly outlined its financial plans to compete with Intuitive Surgical’s Da Vinci SP in the field of robotic internal and external surgery.

Medtronic’s fiscal 2019 profit exceeded consensus expectations, rising 49.2% to $4.63 billion, while sales increased 2.0% to $30.56 billion.

Recently, Medtronic announced a CEO succession plan: Omar Ishrak, Chief Executive Officer of Medtronic, will retire at the end of fiscal year 2020 after nearly nine years at the helm. Geoff Martha, currently President of the company’s Restorative Therapies Group (RTG), will assume the newly created role of President of Medtronic.

During Omar Ishrak’s eight-year tenure, his annual compensation doubled, he added $100 billion to Medtronic’s market capitalization, and he drove the company’s ongoing transition toward global markets and value-based healthcare. Yet most memorable were the acquisitions—most notably, Medtronic’s $50 billion purchase of Covidien in early 2015, the largest merger and acquisition deal in the history of the medical device industry.