Top 10 holding IDEXX Laboratories, Inc. (NASDAQ:IDXX) is the leading provider of diagnostics to the veterinary industry. The company spends six times more on R&D annually than all its competitors combined. As a result, it has continuously improved its menu of diagnostics, which we believe is unsurpassed in the industry. IDEXX is benefiting from secular growth spending on pets, driven by favorable demographics, increased use of diagnostics, and an increasing focus on preventative care. The company’s products are sold via a razor/razorblade model, which produces high retention rates and incremental margins. We think that IDEXX’s direct go-to-market model coupled with meaningful R&D-driven product enhancements will continue to boost revenue and earnings growth over time.
From Baron Funds' fall 2016 newsletter.
