New Study Predicts U.S. Trauma Market Expansion

According to a recent report from Toronto, Canada-based Millennium Research Group (MRG), the trauma device market in the United States, will grow at a steady pace through 2016.

Pricing pressures from the increasing influence of group purchasing organizations (GPOs) will limit average selling prices to some degree, but an increase in the size of the elderly population and the related increase in the incidence of osteoporosis will drive an expansion of procedure volumes, leading to an increase in market size to $3.8 billion in 2016.

Though there will be significant downward pressure on average selling prices, the adoption of premium-priced devices, such as plates and screws and intramedullary nails, will support revenues, according to the report’s authors. Growth in anatomic locking plate systems will be particularly strong through the forecasted period. Anatomic plates are thinner than standard plates and provide greater fixation for fractures at the distal and proximal ends of bones, while locking plates offer greater stabilization and reduced plate compression of bone, which is beneficial for individuals with comminuted fractures or poor bone stock. The versatility and applicability of premium-priced anatomic locking plate and screw systems to the extremities will drive their adoption. Synthes (soon to be a Johnson & Johnson company) has a significant share of this market while the remaining share is split among DePuy (also owned by J&J), Stryker, Zimmer and Smith & Nephew, and niche specialty firms such as Acumed, Wright Medical and Tornier.

“Large companies wishing to increase market share are focusing on lateral expansion through the acquisition of smaller competitors in the U.S. trauma device market,” said Daniel Brown, an MRG analyst . “For example, Johnson & Johnson’s expected acquisition of Synthes in 2012 will reinforce the disparity between competitors in the market. Additionally, Zimmer recently acquired ExtraOrtho, a competitor specializing in external fixation devices. Smaller competitors in the market will face difficulties in increasing market share due in part to larger companies offering device discounts through bulk purchases and relationships with GPOs, preventing smaller competitors who operate on a less flexible profit margin from contesting on price.”

Millennium Research Group’s US Markets for Trauma Devices 2012 report includes procedure, unit, average selling price and revenue information, along with market drivers and limiters and competitive landscape for plates and screws, intramedullary nails, cannulated screws, conventional hip screws, ancillary trauma devices, external fixation devices, and long-bone growth stimulation devices in the United States.