FROM REUTERS: J&J RAISES FORECAST AFTER QUARTERLY PROFIT BEATS ESTIMATES
J.P. Morgan analyst Chris Schott said (hip and knee replacements) seem to be benefiting from a faster-than-expected rebound in these procedures.
“Johnson & Johnson raised its full-year profit forecast and beat analysts’ estimates for quarterly earnings on Thursday …”
FROM FORTUNE BUSINESS INSIGHTS
“COVID-19 is expected to have a short-term impact on the global medical devices market but the long-term impact is projected to be minimal to none”
FROM HEALTH RESEARCH INTERNATIONAL (HRI)
Suzanne Ratzloff (President of HRI), “ … Ratzloff holds firm on a strong recovery, reporting that “fortunately, all of the markets will recover to normal levels or above, albeit some more slowly than others due to capacity and manpower constraints along with economic factors … and markets such as respiratory devices and infection control products, will see massive gains through the end of the pandemic.”
OPPORTUNITIES HIDDEN IN THE WEEDS
In assessing the health of the U.S. device marketplace, the overwhelming majority of producers and suppliers are expecting strong 4th quarter returns. Additionally, companies who specialize in products that are reliant upon elective surgeries (ex. Orthopedics) are looking at a “bounce-back” recovery in Q1 2021 due to patients scheduling procedures previously postponed during the spring and summer months 2020.
OK, you may ask, companies that already have products established in the U.S. feel like their sales are going to bounce back. But what about the development of new products, is there a fall off in bringing new products into the market? It turns out, not so much. We took a look at FDA data related to processing market submissions and approvals, specifically comparing 2019 with 2020. What we found was interesting – combining 501K, Pre-market Authorizations (PMA), and De Novo classifications, the FDA processed more applications in the first half of 2020 compared to the same period in 2019, not even including the 220 devices cleared via the Emergency Use Authorization process.
CONCLUSION: PLAN FOR NEW GROWTH TOMORROW
The conclusion that we draw is that through the peaks and valleys of this unprecedented epidemic, medical device companies are not only weathering the storm, but are ramping up in anticipation of spikes in demand in the coming months. The U.S. government isn’t slowing down at all in processing and approving new technologies, companies with existing U.S. footprints are ramping up for increases in sales, and companies with innovative solutions remain bullish on the U.S. market. Time to jump aboard!