What Does 2020 Have in Store for Medtech?

It's the time of year for reflection and prognostication. A recent report from Mike Matson, a medtech analyst at Needham & Co., offers a little of both for the medical device industry. Here are the key takeaways from Matson's Dec. 19 report: Matson said he expects medtech market growth to improve somewhat in the new year (from 4.9% in 2019 to 5.5% in 2020 on a constant currency basis). Breaking that down to specific sectors, the analyst expects to see market growth in knee and hip replacements, spine, trauma, extremities, cardiovascular, pacemakers, peripheral vascular, transcatheter aortic valve replacement, drug-eluting stents, electrophysiology, and neuromodulation. Matson noted that the medical device tax is scheduled to kick in again in January after being suspended for the last four years, but a repeal "appears imminent" as part of a bipartisan year-end spending deal that could be signed into law by Dec. 20. If the tax is not suspended or repealed, the analyst estimates it would reduce 2020 earnings per share at large companies by an average of 5% and at small and midsize companies by an average of 11%. The analyst noted that the number of medtech M&A deals was relatively stable this year, with about 332 deals in 2019, which is down a bit from 338 deals in 2018. The dollar value of such deals dipped this year, however, from $30 billion in 2018 to about $28 billion in 2019. Looking at the year ahead, Matson said he expects deal activity to remain high in 2020. "F...
Source: MDDI - Category: Medical Devices Authors: Tags: Business Source Type: news