Is the Large-Joint Business Booming—or Boomers?

The possibility of an explosion of potential patients bodes well for orthopedic manufacturers.

By Christopher Delporte
Group Editor

The Deuce knee system, featuring Oxinium surface technology, is just one of the many advances in large joints that are going to benefit younger, more active populations. Photo courtesy of Smith &?Nephew.

Baby boomers. We hear about them all the time lately, and for good reason. This group, born between 1946 and 1964, is a powerful demographic. Their numbers and actions have shaped the second half of the 20th century and continue have a transformational effect well into the 21st. These post-World War II kids—now grandparents to new generations of children—have impacted everything from politics to popular culture—in a big way.

Ask most of them where they were when former President John F. Kennedy was assassinated and they’ll be able to tell you. If you ask them how old they’ll be when it’s time to have a hip or knee replaced (if they haven’t done so already), the answer may not be as certain. But one thing is certain to manufacturers of large-joint replacement devices: The positive impact of baby boomers on the healthcare marketplace—particularly artificial hip and knee markets—remains inevitable.

“We’re preparing for the baby boomer generation,” Cary Hagan, vice president of Ortho Recon marketing for Arlington, TN-based Wright Medical Technology Inc., told Orthopedic Design & Technology.

Wright Medical is not alone. Across the board, manufacturers and industry analysts who spoke with ODT all expressed the same belief that the potential market is staggering. This information certainly isn’t a newsflash, as many sectors of healthcare have been bracing themselves for the financial wallop of America’s aging population. But for orthopedic device manufacturers, such a hit doesn’t have a negative connotation. In fact, the continued growth of this sector is bolstered by it.

“It’s almost alarming to see the bolus of baby boomers who are entering the market in the coming decade. The number of hip and knee procedures over the next 20 years is going to grow upwards of 700%. To one extent it’s exciting as a manufacturer,” Hagan said. “To another, it’s a major responsibility for device manufacturers to offer clinically effective and cost-effective solutions to take care of all these patients.”

Depending on whom you talk to, the large-joint sector growth estimates range anywhere from 7% to 10% annually. Slower growth than in years past (which, for the most part, benefited from consistent double-digit growth) mostly is the result of price pressures, according to experts. But while pricing may remain level, a boost in total units sold in the next few years could mean a significant growth spurt for hips and knees. Internal estimates by United Kingdom-based Smith & Nephew (US headquarters are in Memphis, TN) put the size of the global hip and knee markets at approximately $10.5 billion in 2007 (53% share for knees, 47% for hips), with 9% annual overall growth.

John J. Chopack, Jr., director for orthopedic private equity and research firm HealthpointCapital in New York, NY, said the significance of the baby boomer population might have been underestimated.

“The main thing that is driving the recon business going forward is the demographics. Everyone says the baby boomer demographics are good, but I don’t think they fully understand the impact it’s going to have on this market. And baby boomers haven’t even hit the average age of total replacements yet,” Chopack explained. “The oldest baby boomer right now is 62 years old and the youngest is 44. The average age for [large-joint] replacement is 65. So you’ve got a good 15 years of a dramatic market expansion that I’m not sure everyone’s ready for. The market is going to explode even if pricing remains flat because units are going to skyrocket—maybe 10% or higher per year. Some worry that there won’t be enough surgeon supply to cover the demand looking out through 2030. Large-joint has the potential to grow significantly because that tide of ideal patients hasn’t even hit the market yet.”

According to the MetLife Mature Market Institute in Westport, CT, by 2030, the US population older than 65 years will more than double to about 71.5 million and by 2050 is predicted to grow to 86.7 million. Data from the National Hospital Discharge Survey and the National Center for Health Statistics showed that 235,000 total hip replacement procedures were performed in the United States in 2005 (up from 138,000 in 1996) and 534,000 total knee replacements were performed (up from 245,000 in 1996). A study presented at last year’s American Academy of Orthopaedic Surgeons annual meeting projected that hip replacements are expected to increase 174% in the next 20 years, and knee replacements will increase by a staggering 673%. Those types of statistics should make manufacturers cautiously optimistic.

“Manufacturers in large-joint are in the right place at the right time. Baby boomers—my generation—have caused changes in all areas of today’s society and that includes healthcare,” said W. Jose Belen, president of Amedica, a Salt Lake City, UT-based company developing silicon nitride ceramic implants for the orthopedic and spine market. “We don’t want to compromise. We want to be able to play golf, jog and ride our bikes. We don’t want our activities to be limited just because we have had a hip or knee implant. The baby boomer demographic wants instant results, and they want implants that last.”

Patrick Treacy, vice president of Reconstructive Marketing for Stryker Orthopaedics, a division of Kalamazoo, MI-based Stryker Corp., told ODT that the “bandwidth” of the patients experiencing hip and knee reconstruction—both total and partial—is expanding and that patient population continues to include younger patients in their late 40s and early 50s.

“The opportunity we see is the overall size of the market and refining the products and approaches that allow us to do the things that patients are demanding,” he said. “The challenge is to continue to improve upon what already is a well-respected, understood and effective procedure. But there’s still a lot of room to improve outcomes for the higher-demand patients.”

Consequently, the materials, techniques and technology brought to bear by manufacturers are being geared toward meeting the needs of a younger and extremely active patient population. The terms of the game are longevity and durability. And phrases such as “rapid recovery” are more than just marketing buzzwords; they’re clinical goals.

Resurfacing Technology for Younger Patients

As recently as five or 10 years ago, if a 45-year-old patient paid his or her orthopedic surgeon a visit complaining of hip or knee pain and bad osteoarthritis a doctor would have been at a loss to treat them with a device solution.

“A doctor would be fearful to treat them at all,” Chopack said, adding that physicians would consider a total replacement once the patient was 60 years of age. “In the meantime, [the patient] would have to live with the pain on a joint that continues to wear down and gets worse. Your lifestyle changes. You’re less mobile, which impacts overall health. Today, physicians treat that patient earlier with devices that can bridge the gap between not having anything done and having a total [replacement]. If it can last five or 10 years it will bridge the gap.”

Wright’s Hagan agreed, adding that material technology is making such advances possible.

“The tendency for patients to choose joint arthroplasty at a younger age is increasingly significant,” said Hagan. “When I started in this business in 1989, to do a total joint on anyone under the age of 65 was considered irresponsible, but today with the low-wear metal technologies and new designs in the knee, physicians don’t hesitate as much to treat patients—even in their early 50s—with a fair degree of confidence that the patient will require a comparatively minor revision of that implant during their lifetime.”

One such technology that bridges the gap Chopack mentioned is hip resurfacing, which has gotten a lot of attention from physicians, patients and Wall Street in the last two years.

“In large joint, every couple of years there’s one product or technology that everyone talks about. Six years ago or so it was ceramic-on-ceramic hips, and Wright and Stryker were the first one to market and their revenue growth took off,” he added. “Now, hip resurfacing is the hot product.”

Hip resurfacing technology has been available in Europe for more than 10 years, though it only received FDA approval in the United States in 2006, with Smith & Nephew’s Birmingham system first to market. The Cormet hip, developed by Corin Medical, Ltd. in the United Kingdom and distributed by Stryker in the United States under a 10-year agreement, received its FDA approval last July. Several companies have resurfacing products available outside the United States. Biomet Inc. markets its ReCap device; Zimmer has its Durom product; Johnson & Johnson’s DePuy division’s implant is called ASR (Articular Surface Replacement); and Wright Medical markets its Conserve Plus. Wright recently completed a clinical trial for Conserve Plus in the United States, and the company expects FDA approval in the near future.  

Hip resurfacing involves replacing just the top of the femoral head and the socket of the pelvis bone with metal parts that then act as a new hip joint. The acetabular (socket) component is “press fit” into the pelvis, and the femoral component is cemented to the femur with bone cement. Resurfacing in an attractive alternative for surgeons and many patients because it preserves more of a patient’s femur—or thighbone—which makes it easier to replace the original implant with a total hip in the future, which often is the case for active patients who live with their artificial hips for 15 or 20 years.

Advocates of the procedure say it leads to quicker recoveries, increased range of motion in the hip and a more natural distribution of weight and pressure on the thighbone. Skeptics point to the failure of previous generations of resurfacing and say that much is still unknown about the long-term safety and durability of the current devices compared with total hip replacements.

Hip resurfacing was developed in the late 1970s, but surgeons abandoned the procedure because the large metal femoral head rubbed on the plastic (polyethylene) socket and wore it out. The components loosened and femoral neck fractures occurred. Today’s hip resurfacing devices are improved with metal-on-metal surfaces made of longwearing durable cobalt-chrome alloy.

Even as hip resurfacing gains ground, total hip systems continue to improve with new materials and designs. One company taking a “what’s old is new again” approach in hips is Amedica. Founded in 2003, the company has set its sights on re-pioneering ceramic total hip replacements. While Amedica has been around for only five years, its micro composite ceramic (called MC2) and cancellous structured ceramic (CSC) technologies have been under development for a decade. In addition, the company claims its silicon nitride implants are tougher and exhibit greater wear resistance, with the additional benefit of improved visualization when using X-ray, MRI, CT or fluoroscopic imaging.   

Popular not long ago, ceramic-on-ceramic hips began to fall out of favor because they demonstrated a small rate of so-called “catastrophic failure.” Traditional ceramic hip replacement material (alumina, alumina oxide or zirconia-toughened alumina) has been known to crack, which means another surgery. Newer ceramic hip replacement implants have improved strength characteristics, reducing the potential for breakage, but when articulated against itself there are reports of the joint making a squeaking sound when in motion. While less of a clinical concern, squeaking is annoying, embarrassing to the patient, and might be indicative of other impending problems.

According to Belen, whose 35 years of industry experience include tenure as a design engineer, Amedica’s silicon nitride ceramic is “in a class of its own” and he describes it as “ceramic on steroids.” Silicon nitride has a three-dimensional microstructure that tends to impede cracking, meaning there is no clear path allowing for crack propagation, he explained.

“If you drop a glass of water on the floor it shatters; that is not at all surprising,” Belen said. “But the windshield of a car withstands getting hit by all kinds of debris and usually doesn’t crack. Why? Because the glass is tempered which effectively blunts cracking.”

Belen also noted that Amedica has found a way to make its silicon nitride ceramic, CSC, into a three-dimensional porous structure. In animal studies, the bone has been shown to grow into the device, creating a strong biological bond between the implant and the bone. The result is increased implant stability and the hope of improved long-term satisfactory outcomes.    

Amedica is planning to launch its own line of total hip implants using its silicon nitride ceramics following a 510(k) submission to the FDA.

Knee Implants Benefit From Innovation

Hip innovations aren’t taking all the glory. On the knee side, a recent standout product, according to market analysts, is Smith & Nephew’s Deuce knee launched last year. It’s part of the company’s Journey line of knee products.

The implant is called the Deuce because it replaces only the two areas of the knee most commonly affected by osteoarthritis while keeping the third area intact. Most knee replacements involve removal of a patient’s anterior cruciate ligament (ACL), which can lead to instability and abnormal knee motion. The Deuce allows the surgeon to keep the ACL intact and preserves more of the surrounding bone, treating only the diseased areas—the kneecap and medial compartment—while leaving the lateral portion of the femur and tibia untouched.

In many ways, it’s a resurfacing procedure for the knee, though Smith & Nephew officials stop short of calling it that.

“With the retention of the anterior and posterior cruciate ligaments, Journey Deuce knee system addresses an unmet need in the market for the active, informed patient who may be concerned about potential reduced knee function and mobility with a total knee,” said Joseph DeVivo, president of Smith & Nephew’s Reconstruction division, adding that the system allows for earlier intervention and preserves future surgery options for patients, including a total knee replacement.

Deuce is available with the company’s Oxinium oxidized zirconium surface treatment, a bearing surface that has been shown to reduce wear up to 85%, thereby potentially increasing the longevity of the implant, the company said. All of Smith & Nephew’s major knee and hip implant systems are available with the Oxinium coating.

“Smith & Nephew, over the last couple of years, has distinguished itself introducing both novel materials and products—specifically their total hip resurfacing product and their Oxinium knees,” Chopack said. “They’ve come up with some good products that are real differentiators, which, in large joint, is hard to do.”

Large Joint Predictions

Wright’s Hagan predicted continued rapid improvements in materials science coupled with implant design advancements would improve outcomes in the near term. Also, a better understanding of knee kinematics along with material improvements will decrease wear, increase longevity, allow for earlier intervention and reduce the incidence of implant loosening caused by osteolysis (a condition—which occurs usually after years of use—in which microscopic fragments of a joint replacement irritate the tissues around the implant and begin to weaken the bone).

“We will also see implants and instruments inserted through smaller and smaller incisions, reducing trauma to the muscle and tissue underneath the skin, which is really more important than the size of the incision itself,” he added. “It should also be noted that within the 10-year time horizon, we’ll definitely be using more biologic interventions, such as biologically resurfacing the arthritic joint through various tissue-engineered matrices. There also will be new biomaterials added to implants that provide more rapid biological growth and also add potential prophylaxis against infection by including antibiotic coatings, for example.”

According to Chopack, early intervention is critical to new product development in the large-joint sector.

“The types of products that will do well in the future are those that are able to treat patients earlier in disease state of osteoarthritis,” he said. “Though the older population will continue to grow, a younger demographic will have access to new and innovative technology.”

Stryker’s Treacy calls that kind of opportunity “lifestyle recovery” for implant patients.

“How can we allow patients to get back to those activities they really look forward to doing? We have an obligation not only to create the best performing, high-quality products for our patients, but we also believe we can be a partner with our hospital customers and payers to provide more cost-effective solutions,” he said. “We can develop products that will wear less and last longer, such as our X3 bearing technology—a highly cross-linked polyethylene used in total knee applications that has demonstrated up to 96% decrease in wear in laboratory testing compared to competitive premium bearing surfaces.”

Treacy cautioned, however, that gains in the large-joint sector very seldom are revolutionary—rather, they more often than not are incremental.

“As far as materials advancements, there’s certainly lots of opportunity early in the continuum of care with cartilage and soft-tissue repair, but when you’re far into the arthritic process some advancements may not be a wholesale jump from conventional type materials, but a combination.”

Despite the evolutionary nature of development in large-joint product development, Hagan is unapologetically enthusiastic about industry’s  impact.

“As a small company, our only survival technique is innovation, and we’re good at it,” Hagan said. “If we don’t continue to innovate we will not succeed. So, within this organization you will find a very entrepreneurial environment where everyday, this entire crew is thinking about what they can acquire or develop that will improve the quality of our products and, most importantly, patients’ lives.”

Sidebar
Unique Instrument Technology Delivers Improved Implant Outcomes

New material combinations and design breakthroughs may have helped to revolutionize joint implants, but surgical techniques—even with the advent of minimally invasive and computer-assisted approaches—haven’t evolved much in the past few decades, according to some experts.

That said, a Hayward, CA-based firm called OtisMed has developed technology it hopes will transform the way implant surgeries are performed, ultimately resulting in improved outcomes for patients. Traditional knee surgery requires a surgeon to drill an intramedullary (IM) rod into the patient’s femur to aid in proper alignment. The problem is, an IM rod can put the patient at increased risk of cardiopulmonary complications caused by fat particles (from the bone marrow) entering the bloodstream. It also increases risk of blood loss and infection. Furthermore, bone and ligaments often are cut, causing the new knee to feel unnatural.

OtisMed’s OtisKnee product saves procedure time by taking a lot of the guesswork out of a knee procedure by—weeks in advance of the joint replacement. Prior to surgery, an MRI is performed to take precise measurements of the patient’s arthritic knee. Next, proprietary computer software creates a 3-D image of the knee and then virtually corrects the deformity to return the knee to its pre-arthritic state. A computerized 3-D image of the implant to be used in the patient’s surgery then is matched to the anatomically correct virtual knee model, helping to determine the correct implant size and placement, based on the patient’s own normal (non-arthritic) knee anatomy. Finally, special cutting guides are created for the surgeon to use during the procedure. The patient-specific cutting guides indicate to the surgeon exactly where to make bone cuts so that the knee replacement is customized.

“We’re changing the way orthopedic surgery is done,” said Wilson P. Constantine, MD, vice president for OtisMed. “We went from having six, eight or 12 large trays in the operating room to one tray. OtisKnee has given the surgeon a simpler tool to make cuts—planned for in advance versus a lot of guesswork based on what they’re seeing in the operating room.”

Since its limited US launch last June, the OtisKnee technique has been performed by more than 400 surgeons on more than 5,000 patients. The device currently is optimized for use with knee implants from Stryker Corp. and Biomet Inc., though company officials said the technology could support any knee system on the market.

“All the implants look the same to us; it’s the placement that makes the difference,” said Charlie Chi, PhD, co-founder and CEO of OtisMed. “We’re trying to diversify in other joints and other indications that make sense. We’re close to marketing the next joint in the next three or four months.”

The company also recently launched a patient registry designed to gather clinical and economic outcomes data pertaining to post-operative pain, range of motion, patient satisfaction and recovery rate, as well as surgical time, operating room set-up time and cost, and hospital length of stay.

“Three months after surgery, our knees did better than traditional and navigation-guided [total knee replacement] at six months,” Constantine said. “At six months, we beat their one-year data. And our one-year data is beating their two-, three-, four- and five-year data. The operative time is shortened by half. The room-turn time is shortened by 70%, which is a large economic incentive for hospitals. Discharge time is shortened. And range of motion in 48 hours is 90 degrees or better compared to less than that for traditional procedures. It is a race to motion. As you gain more motion, you’ve got to keep it.”