Greatbatch to Build R&D Centre - Analyst Blog

Medical technologies company, Greatbatch Inc. ( GB ) recently announced that it will set up an Active Implantable Medical Device ("AIMD") Research and Development ("R&D") Centre in Singapore. It will be Greatbatch's first centre outside the U.S., specifically built to cater to the Asia-Pacific medical devices market. It is also the first multinational active implantable products R&D centre in Singapore and in Asia.

The establishment of the facility is in line with the company's long-term strategy of expanding its footprint in emerging healthcare markets. Management also believes that its announcement to launch cost-efficient innovative technologies in the Asian as well as worldwide markets will boost shareholders return.

QiG Group, LLC, the company's subsidiary, which designs and develops new products for its core markets, will team up with physicians and other industry leaders from Asia Pacific to manufacture active implantable products for the growing Neuromodulation and Cardiovascular markets.

Greatbatch has recognized potential research opportunities in MRI Conditional Systems, Interventional Procedures, Atrial Fibrillation ablation as well as therapies for obstructive sleep apnea and obesity related to cardiovascular diseases. In the Neuromodulation market, the company is already developing a new product called Algostim, a spinal cord stimulator to treat patients with chronic pain in the limbs and trunk.

The company chose Singapore as its base given the country's heavy investment in R&D to develop its biomedical science sector and well-endowed research institutes. Kulbir Sandhu has been appointed as the head and Dr. Kaiser as the director of the Singapore R&D centre.

Greatbatch is a leading producer and supplier of batteries, capacitors and components used in implantable medical devices. The company's top customers include Boston Scientific ( BSX ), Johnson & Johnson ( JNJ ), Medtronic ( MDT ) and St. Jude Medical ( STJ ).

Greatbatch has been acquiring complementary businesses over the last few years in a bid to expand. The company has a strong pipeline with a number of products currently in development that should support growth in the long run.

However, soft Cardiac Rhythm Management and Orthopedic markets and pricing pressure remain headwinds. We currently have a Neutral recommendation on Greatbatch. The stock currently retains a Zacks #3 Rank, which translates into a short-term Hold rating.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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