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TWST: Please introduce us to Invacare.
Mr. Mixon: Invacare Corporation is the world's largest manufacturer and
distributor of medical products used in the home. We began as a small
LBO 27 years ago when sales were then $19 million. Today we are a $1.5
billion NYSE corporation, manufacturing around the globe and marketing
to approximately 80 countries. TWST: Give us some idea of what the marketplace looks like, what the
dynamics are. Who are your clients, your competitors?
Mr. Mixon: We define our worldwide home medical equipment marketplace as
approximately $6 billion. We add to that a $2 billion disposables market
in the US. Normally, our market has an internal growth rate of 3% to
5%; however, in the last two to three years, the United States
government (Medicare) has enacted a number of changes in reimbursement
that have caused the market to temporarily stagnate, and decline in some
sectors. Contrary to almost all published data about the cost-
effectiveness of home care versus institutionalized care, our current
government's attitude has been to cut reimbursement in home medical
care. This compromises the quality of life for our seniors and
ultimately will contribute to longer institutional stays and more
frequent readmissions. I guess these cuts are partially to pay for the
new prescription drug plan, the war in Iraq, Katrina and other areas
creating the US deficit. It certainly has been a challenge for our
industry. But overall, people are aging around the world, and nothing is
more important to them than their health care. They prefer to remain out
of institutions to the extent they can, and Invacare is currently in the
middle of that trend. The company has certainly enjoyed considerable
growth over the 27 years that I have led it.
Tickers included in this excerpt: IVC
For more information call (212) 952 7433. The
Wall Street Transcript does not endorse any of the comments made by interviewees, and does
not make stock recommendations.
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