Company: ICUI
Filing Date: 2025-02-27
Form Type: 10-K
Source: 0000883984-25-000007
Chunk: 288

Company: ICU MEDICAL INC/DE
Filing Date: 2025-02-27
Form: 10-K
Item: Item 7
Chunk 288
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Vital Care

The following table summarizes our total Vital Care revenue (in millions, except percentages):

Year Ended December 31,$ change % change $ change % change 2024202320222024 over 20232023 over 2022Vital Care (GAAP)$690.7 $661.0 $687.6 $29.7 4.5 %$(26.6)(3.9)%Impact of foreign exchange rate changes2.9 $4.5 Vital Care on a constant currency basis (non-GAAP)$693.6 $665.5 $ Change in constant currency$32.6 $(22.1)% Change in constant currency4.9 %(3.2)%

Vital Care revenue increased in 2024, as compared to 2023, due to higher sales volume of IV Solutions primarily driven by a market shortage of these products in the U.S. during the fourth quarter of 2024, as explained below.

During the third quarter of 2024, a competitor’s U.S. IV solutions manufacturing facility was damaged as a result of Hurricane Helene causing a national shortage of IV solutions. In response, we actively increased production of our IV Solutions product lines in anticipation of increased demand due to the temporary market shortage. We experienced increased demand for our IV Solutions product lines in the fourth quarter of 2024 and may continue to see elevated demand in the near term given the sustained market shortage until conditions normalize.

Vital Care revenue decreased in 2023, as compared to 2022, primarily due to lower sales volume of IV Solutions which was impacted by supply disruptions related to finished good products purchased from third-party manufacturers and lower sales volume for products acquired from Smiths Group plc ("Smiths") due to backorder recovery in 2022. 

Gross Margins

Gross margins were 34.6%, 32.8% and 30.6% for 2024, 2023 and 2022, respectively.  

45

The increase in gross margin in 2024, as compared to 2023, was primarily driven by lower supply chain costs due to synergies and freight rates, price increases, reduced spend on quality remediation activities and the impact of foreign exchange rate changes which was partially offset by lower manufacturing absorption and higher inventory write-offs.

The increase in gross margin in 2023, as compared to 2022, was primarily driven by lower freight costs, lower spend