Large-cap medical technology company,
) recently announced a five-year worldwide collaboration with GE
Healthcare, a division of
). The collaboration will allow GE Healthcare, a market leader in
biomedical devices and services, to include the measurement
technology used by Covidien in its patient monitoring systems.
GE Healthcare asserts that the collaboration will improve the
standard of patient monitoring and safety. The alliance also
manifests an undertaking by GE Healthcare to maintain an extensive
patient monitoring system that is easily accessible to clinicians
and healthcare administrators.
Following this collaboration, GE's monitoring systems including
CARESAPE Monitor B850 and CARESCAPE Monitor B650 will have easy
access to the measurement technologies of Covidien, enhancing the
clinical information available to physicians.
On the other hand, the collaboration will enhance the technology
portfolio of Covidien associated with patient monitoring. The
Nellcor pulse oximetry with Oximac Technology, INVOS Cerebral/
Somatic Oximetry and BIS Brain Monitoring will get the maximum
The oximetry and monitoring products are a part of Medical
Devices segment, the primary growth driver of Covidien. These
products edged up by 4% year over year in the second quarter,
reflecting double-digit growth in sale of monitors (Nellcor, INVOS,
BIS). The alliance will leverage the sales growth of monitors,
leading to an increase in market share of the oximetry and
monitoring sub segment, which was reportedly flat during the first
GE Healthcare has industry experience of about 100 years in the
development and production of healthcare devices and services.
The company will be able to assimilate clinical measurements
and other patient health parameters at the point of care. It will
thereby support accurate decision making after the alliance.
Also, Covidien management believes that the specialized
measurement technology hitched with the patient monitors at GE
Healthcare will ensure greater precision in patient care and
Covidien is a leading developer, manufacturer and distributor of
medical devices and services on a global scale. Its business
segments overlap with the business of its competitors such as
Becton, Dickinson and Company
Johnson and Johnson
CR Bard Inc
) among others.
With a growth rate higher than its competitors, the stock
currently retains a Zacks #2 Rank, which translates into a
short-term Buy. However, we maintain a long-term Neutral
recommendation on the stock.
BARD C R INC (BCR): Free Stock Analysis Report
BECTON DICKINSO (BDX): Free Stock Analysis
COVIDIEN PLC (COV): Free Stock Analysis Report
GENL ELECTRIC (GE): Free Stock Analysis Report
JOHNSON & JOHNS (JNJ): Free Stock Analysis
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