Paid acquisition into clinical and channel buyers
What do device makers tell investors they spend on marketing?
A founder building a first marketing budget usually goes looking for a benchmark. The obvious place to find one is the public companies in the same category, because they have to tell investors what they spend. So the question is fair: what do listed device manufacturers actually report?
They report a very large commercial cost and almost no marketing line. Selling, general and administrative expense is the biggest operating cost most of them carry. Advertising, the one line that looks like marketing, is small, optional to disclose, and left out by most filers.
This analysis reads that disclosure directly, from the structured data every listed company files with the SEC, for every registrant filed under the three device manufacturing codes.
What does the SEC data actually show about device marketing spend?
It shows a cost structure built on selling, not on media. The median device manufacturer with at least $10M in revenue reports SG&A equal to 50.6 percent of revenue. The median R&D line is 8.5 percent. Only 52 of 128 companies tag an advertising figure at all, and the median of those is 0.8 percent of revenue.
Those three numbers describe one business model. A device company spends about half of every revenue dollar on the costs of selling and running the business, a single-digit share on developing the next product, and a rounding error on anything its auditors would call advertising.
The SG&A figure has a wide spread. The middle half of companies sit between 34.4 and 75.5 percent of revenue, and 16 companies report SG&A at or above 100 percent of revenue, which means they spend more on selling and overhead than they bring in. All 16 sit in the smallest revenue band, between $10M and $100M.
The file above holds every company in the cross-section, including the 52 with less than $10M of revenue that are excluded from every median in this article. They stay in the file so the exclusion can be checked.
Where does advertising sit inside that spend?
Advertising is a sliver of SG&A, wherever a company discloses it. Among the 49 companies that tag both lines, the median advertising figure is 1.8 percent of SG&A. The other 98 percent of the commercial and overhead budget goes to people, travel, facilities, samples, distribution, and the administrative cost of being a listed company.
The line most people mean by marketing, paid media and promotion, is the smallest line a device manufacturer reports, by more than an order of magnitude. The line that dominates is selling.
Where a company splits selling and marketing out from general and administrative cost, the split is informative. The 44 companies that do so report a median selling and marketing expense of 38.5 percent of revenue, with the middle half between 23.4 and 56.7 percent. That is most of SG&A. Overhead is the smaller part.
The advertising distribution is tight at the bottom and long at the top. The middle half of disclosing companies sit between 0.3 and 3.0 percent of revenue. Only 6 companies report advertising at or above 5 percent of revenue. The filings show that they spend it. They do not show why, or whether it works.
Why do most device makers not report advertising at all?
Because a company only has to break advertising out when it is material, and in a device business it rarely is. Of the 128 companies analysed, 76 tag no advertising figure. A missing tag means the company judged the number too small, or too blended into other lines, to report separately. It says nothing about whether the spend exists.
The practical effect is that the public record cannot answer the question most founders are really asking, which is how much a peer spends on demand generation. Trade shows, sample programmes, clinical education, medical science liaisons, field marketing and a large share of digital spend can all sit inside selling expense without any separate disclosure. A company that reports 0.8 percent advertising may be spending several times that on activities a marketer would call marketing.
So the honest reading has two parts. The disclosed advertising figure is a floor. And the gap between that floor and the selling line is where the real commercial budget lives, without a label.
This is also why a founder should be wary of any benchmark that quotes a single “marketing as a share of revenue” figure for medical devices. The public filings do not contain that number. Anyone quoting it has either blended advertising with selling, which overstates marketing, or taken advertising alone, which understates it.
How does commercial spend change as a device company grows?
It stays flat through a long middle stretch and then drops. Companies with $10M to $100M in revenue report a median SG&A of 63.9 percent. Companies with $100M to $1B report a median of 63.7 percent. Only above $1B does the median fall, to 33.2 percent. Scale economies in selling arrive late.
| Revenue band | Companies | SG&A median | Middle half |
|---|---|---|---|
| $10M to $100M | 51 | 63.9% | 43.3% to 109.7% |
| $100M to $1B | 38 | 63.7% | 47.5% to 69.8% |
| $1B and over | 33 | 33.2% | 24.2% to 39.6% |
The first two bands have almost the same median. The spread is what changes. In the smallest band, the upper quartile is above 100 percent of revenue. In the middle band, the range tightens sharply. Companies between $100M and $1B appear to have found a commercial cost structure that holds, and it holds at roughly two-thirds of revenue.
The likely mechanism is structural. A field sales force grows with the number of territories and accounts. Adding a region adds reps, managers, clinical specialists, travel and samples in close proportion to the revenue it brings. Only when a company reaches a scale where one representative carries several product lines, or where distribution partners carry the cost, does the ratio start to fall.
None of the companies above $1B in this cross-section tag selling and marketing separately from general and administrative expense. The largest filers report one combined line, which is why the split-out selling and marketing figures in this article describe smaller companies only.
How does selling compare with R&D?
Selling wins at almost every company. Of the 102 companies that tag both SG&A and R&D, 99 report SG&A larger than R&D. The median company spends 5.8 dollars on SG&A for every dollar of R&D. Device manufacturers are, by what they tell investors, commercial organisations that also develop products.
That ratio moves by band. The median in the $100M to $1B band is 8.4, higher than both the smallest band at 5.1 and the largest at 5.3. Mid-sized companies carry the heaviest commercial load relative to development. That is consistent with a company that has a product the market accepts and is spending to reach every account that could buy it, though the data cannot confirm that reading company by company.
For a founder, the ratio is a useful reality check against the story a board tends to tell about itself. A device company often describes itself through its technology. Its income statement describes a sales organisation.
How was this calculated?
One cross-section from SEC EDGAR, retrieved on 30 September 2026. The company list is every registrant EDGAR files under SIC 3841, 3842 or 3845. Each expense line comes from the XBRL frames API for the CY2025 period, joined on the company’s central index key. Companies with under $10M of revenue are excluded from every distribution.
The SIC list comes from EDGAR’s company browse, paged to exhaustion, for surgical and medical instruments (3841), orthopedic, prosthetic and surgical appliances (3842), and electromedical apparatus (3845). That list includes every company ever assigned those codes, including many that no longer file. Joining it to the revenue frame drops the dormant ones, leaving 180 companies with revenue tagged for the period.
Revenue is taken from the first concept a company tagged, in this order: revenue from contracts with customers excluding assessed tax, total revenues, revenue from contracts including assessed tax, and the older sales revenue tag. The concept used is recorded on every row of the CSV.
SG&A is the tagged selling, general and administrative expense. For 40 of the included companies, which report selling and marketing and general and administrative as two lines instead of one total, SG&A is the sum of the two. That basis is recorded per row too. Companies that tag neither are left blank rather than estimated.
The frames API returns, in the SEC’s own description, the fact for each filer “that most closely fits the calendrical period requested.” A fiscal year ending in June and one ending in December can both land in the CY2025 frame. For 106 of the 128 included companies the period ends in December 2025. The period end for every company is in the file.
Percentiles use the inclusive quartile method in Python’s standard library. The counts behind every median are in the distribution file above. The two queries are recorded verbatim in the sources file for this article, and none needs a key or an account.
# every company filed under one SIC code
https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&SIC=3841&owner=include&count=100&output=atom
# one expense line, every filer, one calendar year
https://data.sec.gov/api/xbrl/frames/us-gaap/SellingGeneralAndAdministrativeExpense/USD/CY2025.jsonThe SEC asks every automated request to carry an identifying user agent. A browser does that automatically. A script has to set it.
What can this data not tell you?
It cannot tell you what a device company spends on marketing, because no filer reports that number. SG&A mixes selling with overhead. Advertising is disclosed only when a company judges it material. The gap between those two lines holds most commercial spend, and nothing in a filing separates it.
The sample is public companies only. Most device manufacturers are private, and a private growth-stage company answers to different investors with different expectations. The public cross-section describes what the market tolerates in a listed company, which may not match the private majority.
SIC codes are assigned once and rarely revisited. A diversified industrial company can sit under 3841 because of one legacy division, and a company whose current business is mostly software or services can still carry a device code. The analysis takes EDGAR’s assignment as given and does not reclassify anyone.
Tagging is not uniform. Some companies tag R&D under a concept that excludes acquired research, others under one that includes it, and a few use custom tags the frames API does not return. A blank cell in the CSV means the company did not use that standard concept for the period, not that the cost was zero.
The frame is a single year. A company that launched a product, restructured, or made a large acquisition during the period will show a ratio that describes that year and nothing more. With 128 companies the medians are reasonably stable, but any single row can be a one-year outlier.
And none of this says what spend produces. A company with SG&A at 70 percent of revenue may be building a durable commercial base or burning cash on a sales force that does not convert. The ratio moves with growth stage, strategy and channel, and the filings do not separate those effects.
What should a founder take from this when setting a budget?
Stop looking for a public “marketing as a share of revenue” benchmark, because the filings do not contain one. Budget the selling system instead: reps, clinical support, samples, events and the marketing that feeds them, as one commercial line. That is how public device companies report it, and how their investors judge it.
The first practical consequence is about the board conversation. A founder who presents a marketing budget as a percentage of revenue, benchmarked against disclosed advertising, will present a number that looks tiny next to the selling line and invites the wrong question. A founder who presents commercial cost as one system, with marketing as the part that makes each rep more productive, is presenting it the way the income statement already treats it.
The second is about where marketing earns its place. If selling is most of SG&A, then marketing’s measurable contribution is to the cost and yield of that sales force: fewer cold calls per meeting, shorter evaluation, more qualified conversations per territory. That makes attribution into the sales pipeline the only reporting that speaks the language of the cost structure. The channel lead-source schema is one way to build that link where distributors sit between the manufacturer and the account.
The third is about the middle band. Companies between $100M and $1B hold SG&A near two-thirds of revenue, with the heaviest selling load relative to R&D. That is the stage where a company can least afford commercial spend it cannot attribute, because the ratio will not fall on its own until scale arrives. Marketing that lowers the cost of each sale is the only lever on that ratio that does not require cutting reps.
The fourth is about competitive context. The commercial cost of reaching a buyer depends on how many other companies are trying to reach the same buyer, and that changes by category. The review-panel data in where new device competitors are entering shows which categories are filling up. A company in a crowded panel should expect its selling ratio to hold higher for longer.
Carmine’s view is that this is the most useful thing the public record offers a founder: the commercial engine of a device company is a sales system, and that marketing budgets justified on their own terms will keep losing arguments to one. More on paid acquisition into clinical buyers sits in the paid acquisition hub, and the operations side in the marketing operations hub.