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The Macro Environment and Edwards Lifesciences’ Growth

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Overview

Edwards Lifesciences is a leading player in the heart valve therapy and critical care monitoring markets. The company has seen tremendous growth over the years, and many of its products are market leaders. Edwards Lifesciences is strategically growing, organically and inorganically.

However, some driving factors of the company’s growth are not company-specific. Macro-environmental factors have also triggered growth in the company’s business, and are expected to drive the company’s future performance.

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Macro-environmental factors

The world’s aging population is expected to increase the need for heart valve treatments and critical care therapies. Disruption in the healthcare industry is another major factor that has driven innovation and advancement at Edwards Lifesciences. As the shift to value-based care accelerates, healthcare companies will likely move towards more comprehensive, advanced, and efficient treatments and therapies, requiring medical technology companies to offer solutions that help reduce total costs of ownership and provide better patient outcomes.

Also, hospitals have started prioritizing structural heart disease cases, which are expected to increase significantly. Also, the US regulatory environment seems to be improving, while Europe seems to be getting challenging.

Medtronic (MDT), Abbott Laboratories (ABT), and Boston Scientific (BSX) are some other major companies in the US medical technology market that are expected to be affected by the abovementioned factors over the years. Investors could consider the iShares MSCI ACWI ETF (ACWI) for diversified exposure to Edwards Lifesciences. EW accounts for ~0.05% of ACWI.

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