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The Healthcare Investor Insights on Issues & Trends that Impact Investments in Healthcare & Life Science Businesses

Diagnostic & Monitoring Device Companies Attractive Investment

Posted in Life Sciences Investing

Since the beginning of 2011, medical diagnostic and monitoring device companies have been performing in an established and even an exceptional manner. To date, these specialized medical device businesses have shown double-digit EPS growth and organic revenue growth in the middle-to-high-single digits.

Sales from medical tool companies have risen 14%, diagnostics companies 15%; up 5% as compared to the Standard & Poor. The prior year saw the diagnostics/tools sector up nearly 30%.  Perhaps the most desirable companies are those that have been in existence for a number of years in such emerging markets as China and India, where they are able to capitalize on the resources of the region.

A most interesting classification is the role of genomic testing in clinical diagnostics. DNA sequencing, a combination of chemistry and engineering is, arguably, the most dynamic segment of the medical device market, as well as the fastest growing.

Of the approximately 300 leading healthcare companies that are actively investing in all types of medical products and services, about 10% are in the areas of diagnostic and monitoring devices, with diagnostics seeing four times more companies than monitoring.

Besides monitoring and diagnostic device companies, other tools, services and software being developed by healthcare companies include therapeutic and surgical devices, pharmaceuticals, drug delivery systems, medical records, hospital/patient/clinic services, biotechnology, elderly/disabled care, laboratory services and medical supply companies.

Companies with rapid growth in the fields of diagnostic and monitoring devices include: Securus Medical Group, which has raised $750,000 of a planned $1.5 million Series A venture funding; Intuity Medical, which has raised Series D funding of $76 million and NanoDetection Technology, which has raised Series A funding of $2.3 million from its lead investor.

Monitoring and diagnostic device companies look to be poised to lead healthcare manufacturing and technology companies into the new year.