Medical device major Medtronic plc MDT recently entered into a new strategic tie-up with Samsung Electronics, in an attempt to expand its valued partnership with the renowned electronics company. Under this alliance, both the partners seek to provide more advanced digital health solutions in neuromodulation therapy to millions of patients, across the world.
Interestingly, this news comes close on the heels of the FDA approval of Medtronic’s Activa portfolio of Deep Brain Stimulation (DBS) neurostimulators’ systems for conditional use in full-body Magnetic Resonance Imaging (MRI) scans. The back-to-back developments indicate Medtronic’s efforts to expand its foothold in the multi-billion dollar neuromodulation market, besides enriching its portfolio through integration of innovative technology.
Management unveiled the new partnership with Samsung at the North American Neuromodulation Society (NANS) Scientific Session, which was held in Las Vegas to address patients who suffer from chronic pain, epilepsy, Parkinson’s disease and other movement disabilities, spasticity, incontinence and other such disorders.
Through this partnership, Medtronic aims to deliver its next-generation neuromodulation therapies with the help of Samsung’s smart mobile technology. With the growing prevalence of telemedicine among patients as well as healthcare providers, devices like smartphones and tablets have emerged as crucial assets for healthcare services. Medtronic’s recognition of this trend in healthcare is the primary reason for its association with Samsung, on yet another level.
Through this partnership, patients implanted with Medtronic’s neuromodulation devices, and their healthcare providers, who possess smartphones, tablets and other wireless devices, can have access to real time patient data. This in turn will help a physician or a care giver to regularly monitor the patient’s data, track symptoms and accordingly manage his/her neuromodulation therapy technique.
We believe this will not only reduce the need for a patient to make frequent physician visits, but also help save time and cost for the overall healthcare industry, by streamlining and expediting the services offered.
Samsung, on its part, enjoys the foremost position in the app-based smartphone market, courtesy its groundbreaking, easy-to-use Android operating system. Medtronic, as a strong contender in the neuromodulation market with its Medtronic’s MR Conditional DBS system as the only one approved to undergo full-body MRI scans, looks to adequately benefit from its collaboration with Samsung.
We expect the strategic tie-up between these two experts to benefit patients in need of neuromodulation therapy, apart from enhancing market share for the companies in the neuromodulation space that holds a market potential of $6.20 billion by 2020.
In June 2015, Medtronic had joined hands with Samsung to provide seamless, timely access to diabetic data for patients as well as their care givers. The companies aimed at co-developing a mobile app for Samsung users, which will offer useful insulin pump and continuous glucose monitoring (CGM) information. We believe the latest tie-up with Samsung reflects Medtronic’s faith in the former and management’s expectation to gain substantially from the deal.
Another company treading the same path as Medtronic is Nephros, Inc. Nephros initiated a strategic collaboration with Biocon 1, LLC, a commercial water purification company, in Nov 2015. Per the deal, Nephros will have access to Biocon’s anti-scale and related water filtration technology to develop filter products for the medical industry.
Currently, Medtronic has a Zacks Rank #3 (Hold). Some better-ranked medical stocks are Natus Medical Inc. BABY, Masimo Corporation MASI and Olympus Corporation OCPNY. All the three stocks hold a Zacks Rank #1 (Strong Buy).
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