08.02.07
No Bones About It: Growth Remains
A lot can happen in a year. Once again, Orthopedic Design & Technology takes an in-depth look at the largest players in the orthopedic market. This set of profiles, our second annual report of the top 10 orthopedic companies, ranks the leading publicly traded firms by orthopedic-related revenue for fiscal year 2006.
Though the impressive double-digit expansion the orthopedic sector enjoyed a few years back flattened some in 2006, the top orthopedic companies in the industry still reported overall growth, claiming their share of a $26 billion global marketplace. In fact, six of the companies on this year’s list reported revenue growth of 10% or more compared to the previous fiscal year—Stryker, Synthes, Medtronic Sofamor Danek, DJO, Kyphon and Orthofix.
Pricing pressures may have taken their toll, but the ubiquitous industry growth factors we’ve all come to know so well—the rapid rise of aging US and global populations, active baby boomers who will live longer than previous generations and an obesity epidemic, just to name a few—continued to drive the orthopedic industry forward. In addition, innovation in areas such as minimally invasive surgery also fueled market expansion, making previously traumatic implant surgeries much more patient friendly.
Large joint implants—hip and knee—still reign (volume, more so than price, now is the name of the game), but the spine market (worth $6 billion in 2006) is growing at a faster rate, and the trauma sector is poised for continued significant growth (14% growth between 2005 and 2006). To maintain their competitive advantage, orthopedic companies are continually challenged to innovate and get products to market as quickly as possible. They often achieve this through mergers and acquisitions, of which 2006 certainly saw its fair share and 2007 picks up where last year left off. Private equity firms also have taken a shine to the orthopedic sector (think Biomet and DJO), mirroring a trend experienced by the overall device industry.
Michael Matson, senior analyst who covers the orthopedic market for Wachovia Capital Markets in New York, NY, told ODT that some of the smaller companies in the market (less than a billion dollars in sales)—particularly Kyphon and Orthofix—achieved significant sales growth by making the right buys, especially given the fact that there have been few blockbuster product launches.
“Acquisitions are helping to drive revenues,” he said. “These companies are getting bigger through deals.”
Along with input from industry experts, public documents and consultations with company officials helped us compile this report, which examines the numerous factors that affect companies’ triumphs or trials. Space constraints limit out ability to detail every twist and turn a company may have experienced in the past year, but we hope you, nonetheless, find it comprehensive and informative.
A lot can happen in a year. Once again, Orthopedic Design & Technology takes an in-depth look at the largest players in the orthopedic market. This set of profiles, our second annual report of the top 10 orthopedic companies, ranks the leading publicly traded firms by orthopedic-related revenue for fiscal year 2006.
Though the impressive double-digit expansion the orthopedic sector enjoyed a few years back flattened some in 2006, the top orthopedic companies in the industry still reported overall growth, claiming their share of a $26 billion global marketplace. In fact, six of the companies on this year’s list reported revenue growth of 10% or more compared to the previous fiscal year—Stryker, Synthes, Medtronic Sofamor Danek, DJO, Kyphon and Orthofix.
Pricing pressures may have taken their toll, but the ubiquitous industry growth factors we’ve all come to know so well—the rapid rise of aging US and global populations, active baby boomers who will live longer than previous generations and an obesity epidemic, just to name a few—continued to drive the orthopedic industry forward. In addition, innovation in areas such as minimally invasive surgery also fueled market expansion, making previously traumatic implant surgeries much more patient friendly.
Large joint implants—hip and knee—still reign (volume, more so than price, now is the name of the game), but the spine market (worth $6 billion in 2006) is growing at a faster rate, and the trauma sector is poised for continued significant growth (14% growth between 2005 and 2006). To maintain their competitive advantage, orthopedic companies are continually challenged to innovate and get products to market as quickly as possible. They often achieve this through mergers and acquisitions, of which 2006 certainly saw its fair share and 2007 picks up where last year left off. Private equity firms also have taken a shine to the orthopedic sector (think Biomet and DJO), mirroring a trend experienced by the overall device industry.
Michael Matson, senior analyst who covers the orthopedic market for Wachovia Capital Markets in New York, NY, told ODT that some of the smaller companies in the market (less than a billion dollars in sales)—particularly Kyphon and Orthofix—achieved significant sales growth by making the right buys, especially given the fact that there have been few blockbuster product launches.
“Acquisitions are helping to drive revenues,” he said. “These companies are getting bigger through deals.”
Along with input from industry experts, public documents and consultations with company officials helped us compile this report, which examines the numerous factors that affect companies’ triumphs or trials. Space constraints limit out ability to detail every twist and turn a company may have experienced in the past year, but we hope you, nonetheless, find it comprehensive and informative.
The ODT Staff
Top 10 Orthopedic Device Manufacturers
1. | Stryker Corp. | $5.4B |
2. | DePuy | $4.1B |
3. | Zimmer Holdings | $3.5B |
4. | Smith & Nephew | $2.8B |
5. | Synthes | $2.4B |
6. | Medtronic | $2.2B |
7. | Biomet | $2B |
8. | DJO | $413M |
9. | Kyphon | $408M |
10. | Orthofix | $365M |