Medical Design Briefs - November 2022 - 15

Glenn Boehnlein, Stryker vice president and chief financial
officer.
buckets within our P&L. On the first
side, there's our med-surg products.
Med-surg is used to going after price
- and has gone after a price in the
past. In fact, if you look at Q2, U.S.
med-surg had a positive price of 0.4 percent.
Endo, instruments, and medical
are putting in the incentive plans, and
working with their customers to help
rationalize the price increases that they
need. It doesn't happen overnight. So,
I do think that on that side of the business,
we'll see a good price impact as we
get rolled into next year, " he said. " The
med-surg/neuro segment is providing
some extremely innovative solutions in
instruments, surgical tech, and acute
care - including things like extremely
advanced resuscitation technologies. "
The ortho side of the business is managed
much more centrally, said BoehnStryker
is based in Kalamazoo, MI. (Credit: Stryker)
lein. " Those are large contracts, and those
contracts come up for renewal every three
years or so. Typically, on the ortho side
of the business, we see anywhere from -5
percent for spine to -2 percent for hips
and knees. " This, he said, provides Stryker
with an opportunity to engage its customers
and start to work on price.
" A win could even look like holding
price flat on the ortho side, but it is a
conversation that we are having with customers
now. I expect that we'll see the
positive benefit of this at some point rolling
through next year. At any given time
in ortho, we only have the opportunity to
address about one-third of the contracts
in a given year. "
The pandemic led to disrupted global
supply chains, along with other challenges
including inventory shortages, cost pressures,
and lead times. Despite this, Stryker
stayed steady and weathered the storm.
" If you look at our growth numbers,
endo and instruments are being impacted
but they're managing through
it - given the robust growth we had in
Q2 [2022]. Medical - having negative
growth in Q2 even aside from the large
comparable [companies] - they are the
one division that's being impacted the
most from supply constraints. Defibrillator
and bed products are where we are
feeling most of that. "
But, added Boehnlein, " we have good
visibility to supply through the rest of
this year, so we'll see sequential improvement
out of medical through the rest of
this year, which gets us to our overall 8-9
percent growth number. "
Stryker is feeling underlying inflation
in labor as well as operating " hand to
mouth " on some raw material supplies.
" We don't have our normal steady manufacturing
environment. That's driving
Table 1. Stryker strategy: drive market-leading growth and achieve category leadership in med-surg, neurotechnology, orthopedics, and spine. (Credit: Stryker)
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Medical Design Briefs - November 2022

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