Transcripts

Medical Technology That Saves Lives & Makes Money

SUSIE GHARIB: Aging baby boomers are pushing medical technology in a variety of new directions these days and the race to diagnose and treat their ailments is bringing healthy profits for some medical device manufacturers. Diane Eastabrook has details.

DAVID WILLIS, CLINICAL MARKETING MANAGER, SONOSITE: It's in a docking station right now, but just flipping a quick lever, this is what you take with you when you go portable.

DIANE EASTABROOK, NIGHTLY BUSINESS REPORT CORRESPONDENT: SonoSite's (SONO) portable ultrasound system weighs a fraction of what a conventional ultrasound system weighs, so it can be brought to the patient, rather than the patient being brought to it.

WILLIS: We've been shipping this system for just over a year. Total sales worldwide, we probably have over 3,000 systems out there.

EASTABROOK: The SonoSite system is one of many new cutting edge devices manufacturers are hawking to hospitals and clinics at this radiological conference in Chicago. Most of these gadgets aren't cheap. GE Medical Systems, the largest exhibitor here, is displaying a $1.5 million MRI machine. GE says the so-called High Field Open MRI System is faster and produces clearer images than competing systems. The company also says it is having no trouble finding buyers.

JEFF McCAULLEY, GENERAL SALES MANAGER, GE MEDICAL SYSTEMS MRI: We've got orders, back orders well over 40 units. We expect to have at least 20 of those installed by the end of the year and we expect to see the growth in this segment continue to be well over the double digits well into next year.

EASTABROOK: The medical device industry is about a $130 billion market and while it hasn't attracted the attention from investors that biotechnology has, analysts say the industry is relatively stable and is growing steadily. Analysts say an aging population and strong product development will keep the medical device industry growing in the low double digits, despite moves by many hospitals to contain costs.

BRUCE JACOBS, MEDICAL DEVICE ANALYST, DEUTSCHE BANC ALEX BROWN: There's no question that there has been some constraints put on hospital spending, but I think what is unique about the medical device industry is that many of the technologies are not part of the problem with health care, they are actually part of the solution, where they actually minimize costs and make procedures faster, make procedures less invasive.

EASTABROOK: Jacobs says the market opportunities for medical device makers are immense. He says the challenge is coming up with new and innovative products that will take advantage of those opportunities. Diane Eastabrook, NIGHTLY BUSINESS REPORT, Chicago.