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PART I ITEM 1. BUSINESS. General Stryker Corporation is one of the world's leading medical technology companies with 2012 revenues of $8,657 and net earnings of $1,298. Stryker's products include implants used in joint replacement and trauma surgeries; surgical equipment and surgical navigation systems; endoscopic and communications systems; patient handling and emergency medical equipment; neurosurgical, neurovascular and spinal devices; as well as other medical device products used in a variety of medical specialties. Stryker was incorporated in Michigan in 1946 as the successor company to a business founded in 1941 by Dr. Homer H. Stryker, a prominent orthopaedic surgeon and the inventor of several orthopaedic products. In the United States, most of our products are marketed directly to doctors, hospitals and other healthcare facilities. Internationally, our products are sold in over 100 countries through Company-owned sales subsidiaries and branches as well as third-party dealers and distributors. As used herein, and except where the context otherwise requires, "Stryker," "we," "us," and "our" refer to Stryker Corporation and its consolidated subsidiaries. Business Segments and Geographic Information We segregate our reporting into three reportable business segments: Reconstructive, MedSurg, and Neurotechnology and Spine. Financial information regarding our reportable business segments and certain geographic information is included under "Results of Operations" in Item 7 of this report and Note 12 to the Consolidated Financial Statements in Item 8 of this report. The net sales for each reportable segment over the last three years were: Reconstructive MedSurg Neurotechnology and Spine Total $ $ 2012 3,823 3,265 1,569 8,657 44 % $ 38 % 18 % 100% $ 2011 3,710 3,160 1,437 8,307 45 % $ 38 % 17 % 100% $ 2010 3,549 2,803 968 7,320 48 % 38 % 14 % 100% Reconstructive Reconstructive products consist primarily of implants used in hip and knee joint replacements and trauma and extremities surgeries. We bring patients and physicians advanced implant designs and specialized instrumentation that make orthopaedic surgery and recovery simpler, faster and more effective. We support surgeons with the technology and services they need as they develop new surgical techniques. The net sales of Reconstructive products over the last three years were: Knees Hips Trauma and Extremities Other Total $ $ 2012 1,356 1,233 989 245 3,823 35 % $ 32 % 26 % 7% 100% $ 2011 1,316 1,228 931 235 3,710 35 % $ 33 % 25 % 7% 100% $ 2010 1,306 1,154 845 244 3,549 37 % 33 % 24 % 6% 100% In 2012 we launched Accolade II, the first hip stem with a Morphometric Wedge design, an evolution of the tapered wedge stem. We also launched the GetAroundKnee direct to consumer advertising campaign to convey the benefits of the single radius design of our Triathlon Knee System. In 2011 we acquired Memometal Technologies, which develops, manufactures and markets products for extremity (hand and foot) indications that enhance the offerings in our trauma product line. Stryker is one of five leading competitors in the United States for joint replacement and trauma products; the other four are Zimmer Holdings, Inc. (Zimmer), DePuy Synthes Company (DePuy Synthes, a subsidiary of Johnson & Johnson), Biomet, Inc. and Smith & Nephew plc. We are also a leading player in the international markets, with these same companies as our principal competitors. 1 Dollar amounts in millions except per share amounts or as otherwise specified