Investment Opportunities in Medical Device Industry

Release time:

2024-02-02


U.S. stocks have produced 14 large market capitalization (market capitalization of more than $10 billion) ten times the medical stocks in the past decade, of which eight are medical devices, three are innovative drugs, and three are medical services, indicating that medical device companies have a high growth potential. The research and development cycle of innovative drugs is as long as 10 years on average, the research and development cost is more than 1 billion US dollars, and the success rate is about 10%. In addition, innovative drugs have a patent protection period of about 10 years after they go on the market. After the expiration, the sales of original research drugs have dropped sharply due to generic drugs, which has become a "patent cliff". Compared with drugs, the R & D cycle of medical devices is short (it takes about three to five years from R & D to approval for listing), less investment and fast return. At the same time, due to brand and doctor's usage habits, the substitutability of products is weak, the product life cycle is longer, and no competitors will quickly encroach on the market when the patent expires, and the investment risk is lower, This is also the reason why the number of medical device companies listed on the-share in recent years.