Raymond James: Medical Technology Sector Pricing Stabilizes After Brief Rise

Investing.com - According to Raymond James’ analysis, the pricing of the healthcare technology sector is expected to remain stable in 2025. This data does not include the impact of Johnson & Johnson’s Stelara losing its patent exclusivity.

The company used publicly available data to study pricing trends from 2015 to 2025 and found that after seven years of price deflation, the sector’s prices turned positive in 2023 and 2024, possibly in response to COVID-19-related inflation. However, during this period, price changes had minimal impact on overall revenue growth.

In 2025, the reported prices turned negative, but Raymond James believes this is mainly due to Johnson & Johnson’s Stelara losing its patent exclusivity, as J&J reports prices at the corporate level including its innovative pharmaceuticals division. Excluding J&J from the sample, the healthcare technology sector’s prices in 2025 are expected to remain flat.

The analysis covers five companies that have consistently disclosed annual pricing trends in their 10-K reports: NYSE:ABT, NYSE:BDX, NYSE:JNJ, NYSE:SYK, and NYSE:ZBH. These companies’ total revenue in 2025 is approximately $170 billion; excluding J&J’s innovative pharmaceuticals division, it is about $110 billion.

Raymond James noted that, given the competitive structure of most healthcare technology end markets, it is surprising that prices have not increased. The analysis shows that sales volume remains the main driver of industry growth, making new product development the most important factor for sustained price improvement.

The company also supplemented its analysis with government data from the FRED Medical Device Producer Price Index, which tracks sector pricing, as well as data from HCA Healthcare, the largest hospital supplier in the U.S.

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