As we’ve witnessed rapid large-scale shifts in the global healthcare environment in recent years, our team has acted quickly and thoughtfully to develop strategies, products and solutions that meet the changing needs of caregivers and patients, and ultimately grow value for our shareholders.

Now more than ever, key decision makers are looking for cutting-edge products backed by clinical evidence and coupled with innovative business models, services and solutions. They’re looking for integrated teams that can bring services and systems to help caregivers and patients across the care spectrum, and they need these teams to spring to action quickly and to execute with precision. And all of this must be achieved with an unwavering focus on quality.

To meet these needs, a company must be willing to embrace change, move quickly and have the capacity for widespread innovation. Over the last three years, our employees have demonstrated a willingness to transform and embrace an enterprise-wide culture that inspires innovation — the special Stryker spirit that is forward thinking. As a company, our leadership teams have moved toward an innovation approach that challenges every aspect of our business model. From a product and services standpoint, our vital innovation process relies on the combination of a disciplined commitment to R&D and a well-executed acquisition strategy.

Our R&D efforts are delivering results with new product launches such as the Target Detachable Coil with Tenzing Technology for hemorrhagic stroke patients; MDM X3, a mobile bearing hip system for a broader patient population; and Stryker ADAPT, an image-guided adaptive positioning technology for more precise placement of implants. Beyond these products, each and every division of the Company introduced new product or service offerings to the market in 2011.

On acquisitions, we have executed a focused strategy as we acquired companies to supplement our core businesses and added key new growth platforms. With the acquisition of Orthovita, Inc. (Orthovita), we expanded our orthobiologics portfolio and strengthened our competitive position in key segments of the spine, orthopaedics and biosurgery markets. Our acquisition of Memometal Technologies (Memometal) further established our Company as a key player in the rapidly growing foot and hand segments of the extremities market and created a strong presence for Stryker in the podiatric surgery market.

We added a new growth platform with the acquisition of Boston Scientific’s Neurovascular business (Neurovascular), which offers products for the treatment of hemorrhagic stroke, and Concentric Medical, Inc. (Concentric), a leader in the treatment of acute ischemic stroke (AIS). We made these moves after we identified the neurovascular interventions market as one of the fastest growing and most innovative sectors in medical technology, and as a complement to our existing presence in the spine and neurosurgery markets.

Additionally, the Neurovascular and Concentric acquisitions created what we think of as one of the most exciting stories in medical technology today. This is a story about Stryker and how we can bring together technologies and treatment capabilities not just to improve lives, but also to help save them. By coupling the hemorrhagic stroke treatment capabilities with Concentric’s leading devices to treat AIS, Stryker is now a world leader in complete stroke care and is able to bring life-saving technologies to patients.

This year, our newly created Performance Solutions division also developed and piloted compelling new offerings. We are working to engage our customers on a deeper level than ever before by delivering services and systems that enable healthcare providers to achieve their clinical, operational and financial performance goals. These services and systems include performance management and other data-driven capabilities from newly acquired business Marshall Steele.

At the same time, the need to plan, produce and execute with excellence in an ever-evolving healthcare landscape has become even more of an imperative as cost pressures continue to rise. Amid global economic challenges, we’ve continued to advance our quality discipline — the result of the three-year, $200 million quality and compliance overhaul we began in 2008. We are pleased with the strong impact of our substantial investments and the resulting “quality first” philosophy in our culture. As previously noted, we formally completed our operational reorganization, moving all of our quality and operational activities into one company-wide system with an independent reporting structure. Much like our commitment to innovation and delivering exceptional financial results, our commitment to a robust quality approach is now part of our DNA and will remain a focus for all our employees.

Evolving Sales Footprint

Evolving Sales Footprint

2009 Sales

  • Medsurg

    1. Hips: 16%
    2. Knees: 19%
    3. Trauma/Extremity: 12%
    4. Other Reconstructive: 3%
  • Reconstructive

    1. Instruments: 15%
    2. Endoscopy: 14%
    3. Medical: 7%
  • Neurotechnology and Spine

    1. Spine: 10%
    2. Neurotechnology: 4%

2011 Sales

  • Medsurg

    1. Hips: 15%
    2. Knees: 16%
    3. Trauma/Extremity: 11%
    4. Other Reconstructive: 3%
  • Reconstructive

    1. Instruments: 14%
    2. Endoscopy: 13%
    3. Medical: 9%
    4. Sustainability Solutions: 2%
  • Neurotechnology and Spine

    1. Spine: 8%
    2. Neurotechnology: 9%