Originally Published MDDI October 2004

Cover Story

MD&DI's Medical Manufacturers of the Year

Erik Swain

What makes for an outstanding medical device company? There are many ways to answer that question, given the diversity of the industry and the wide array of accomplishments by its member companies.

Indeed, the world of medical devices is so variegated that it is nearly impossible to single out one company as the industry's top success story or as its foremost role model. In particular, the larger device firms and the smaller ones have completely different sets of issues to face and challenges to overcome.

So this year MD&DI has chosen two Medical Manufacturers of the Year: a large company and a small one. The former, Zimmer Holdings Inc. (Warsaw, IN), is one of the most respected of the industry's giants. The latter, Aspect Medical Systems Inc. (Newton, MA), is only just starting to get recognition as a company that is having an effect on healthcare.

Yet, while the day-to-day issues of the two firms have little in common, there are some similarities in how they achieved success.

One is the strategic vision of management and the commitment to seeing it through across the entire organization. Beginning in 1998, Zimmer reinvented itself as an orthopedics manufacturer that would pioneer the use of minimally invasive surgery in its field. It then executed a strategy of research, development, and acquisitions that today make it one of the fastest-growing companies in its sector. Likewise, Aspect has never wavered from its mission to improve the safe delivery of anesthetic through consciousness monitoring. It has refined its technology and partnered with larger firms to make sedation safer for millions of patients.

Another is the ability to persevere through setbacks. Zimmer endured years of being a low-priority subsidiary of a company in another industry and was in danger of becoming a dinosaur. But it found a strategy that restored the company to the vanguard of its field and has generated enough enthusiasm to create almost $13 billion in market capitalization in the three years since it became independent. Aspect almost ceased to exist because of failed clinical trials. But it learned from its adversity and today its technology has proved its worth many times over.

What follows are two very different stories that illustrate some of the same lessons.

Zimmer Holdings Inc.: Out from Under

Aspect Medical Systems Inc.: Patience Pays off

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