Medilines sets plan to sustain growth


Medilines Distributors Inc., a distributor of top medical equipment in the country, said it will continue to focus on resilient products that have allowed the company to grow.

“Crafting our product portfolio is at the heart of Medilines’ strategy that has brought us sustainable growth over the years,” Medilines chairman Virgilio B. Villar said.

“We focus on products with resilient demand while building our capabilities to dominate certain markets rather than chasing a hot selling item that everybody else is selling,” he said.

Villar’s company is separate entity from those of his brother, former politician Manuel B. Villar Jr., chairman of property developer Vista Land and Lifescapes Inc. and his family’s other privately-held firms.

Medilines said this strategy provides stability in sales as their products remain necessary for patient care regardless of whether the pandemic prolongs.  The company is the largest distributor in the Philippines of cancer therapy equipment with over 90 percent market share and of dialysis machines with over 50 percent share according to an independent study conducted by research firm Ken Research Ltd.

Cancer and kidney illnesses are among the most prevalent diseases afflicting Filipinos. Medilines also distributes diagnostic imaging devices, such as CT scans, x-rays and MRI’s. Medilines, touted as the country’s first pure-play healthcare initial public offering, is scheduled to list its common shares on the main board of the Philippine Stock Exchange on December 7, Tuesday under the trading symbol “MEDIC”.

“Amid the volatility, it is a welcome development for the Philippine stock market to finally have a pure-play healthcare listed company as the companies in this sector are typically considered as defensive stocks,” Gerry B. Valenciano, president and CEO of PNB Capital and Investment Corp., said.

“Demand for healthcare is seen to be resilient and less impacted by economic changes. We see growth to be driven by the changing demographic trends such as the ageing population and increasing awareness in the importance of healthcare.”

Medilines has demonstrated a track record of growth at a higher rate than that of its industry attributing to the growing demand for its products. From 2018 to 2020, their topline grew at a compounded annual growth rate (CAGR) of 11.9 percent to just under P1.5 billion, while net income grew at a CAGR of 16 percent to P103 million.

Its revenues for the six-month period ended June 30, reached P815 million while its net income was at P100 million.

Linear accelerators or LINACs, which contributed over 60 percent of the company’s sales for the period, are used for the treatment of cancer.

Ken Research estimates that the cancer therapy equipment market will grow at a CAGR of 18.8 percent until 2025 due to investments being made into developing treatment centers. The National Cancer Prevention and Control Action Plan, for instance, provides for the establishment of cancer centers in major cities nationwide.

“To sustain our growth in the dialysis category, we are transforming this business line into a one-stop-shop where our customers can buy not only the equipment but also their regular supply of consumables,” Villar said.

“This will also help grow our bottom line as consumables tend to have higher profit margins versus equipment.”

PNB Capital is the sole issue manager, lead underwriter and sole bookrunner for the company’s initial public offering.

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