The global head of GE Healthcare says the company is looking to grow via acquisitions in information technology and life sciences, as countries such as Australia search for more efficient ways to treat an ageing population through their healthcare systems.
“These are technologies that are going to be very important in the future because of the trends,” global chief executive John Dineen said.
“Healthcare systems are trying to get more productive.”
Examples of GE Healthcare’s acquisitions this year in the US include several life-science businesses from Thermo Fisher Scientific, bought for $US1.06bn ($1.13bn), and the purchase of a healthcare software provider, API Healthcare, for an undisclosed sum.
But Mr Dineen conceded competition for acquisitions was strong in healthcare.
“Some of the multiples in the space are higher than traditional industrial assets,” he said. “It is something we have to think about.”
GE Healthcare’s growth in developing markets has been in the double digits, while growth in the developed markets has been in the single digits.
Mr Dineen said the two big trends were developed countries looking to treat more people without spending more money, while developing countries, such as China and India, were improving healthcare systems and becoming increasingly willing to spend more.
He said the company needed to be able to provide equipment that catered for both trends, such as providing highly sophisticated ultrasound systems along with handheld systems that cost much less and can be used out on the field in places such as Africa.
“Most countries are looking for a solution. They are seeing many more sick people due to demographics.”
In developed countries, he said, there was “more demand and less money”. Developing nations, he said, “are a lot more interested these days in building their healthcare system”.
He said GE Healthcare saw opportunities in improving IT systems in the sector, which had lagged other industries such as banking and airlines, where you could bank online or book flights from your laptop. There were opportunities to provide more medical information, such as results of blood tests, in the same way, he said.
The emphasis in healthcare has been shifting from applied treatments like drugs and therapies to biotechnology such as stem cell therapies and insulin manufacturing.
GE Healthcare’s global annual turnover was $US19bn ($20.2bn), Mr Dineen said, with the Australian market contributing about $US500m.
The London-based subsidiary of the US conglomerate General Electric operates in numerous countries, with its divisions including clinical and diagnostic equipment, such as X-ray, MRI and ultrasound machines, healthcare information technology systems, molecular diagnostics and life sciences.
Mr Dineen, a 28-year veteran with GE, said the company was not focused on any major expansion in the Australian operations, but rather maintaining its share of about one-third of the market in the areas in which it operated.