30 Day Trial
ORTHOKNOW logo

ORTHOKNOW content is posted to these pages in real time.

Monthly compilations are available in PDF form.

Current & Critical

Orthopaedic Industry Revenue Reaches $48.1 Billion

By Carolyn LaWell

Orthopaedic industry revenue reached $48.1 billion worldwide in 2016 and grew at 3.2%, ~$1.5 billion over 2015, according to our estimates published in the ORTHOPAEDIC INDUSTRY ANNUAL REPORT®, which is available now.

This growth was nearly 2% more than we projected one year ago. Every market segment and every company has a different performance story. Two narratives that are intertwined are the performance of the top companies and their correlation specifically to the joint reconstruction and trauma markets. In 2016, joint recon and trauma performed nearly 3% higher than they did in 2015. Most companies attributed the return to growth to a stable U.S. market and increased sales in emerging markets. For further clarification, Exhibit 1 below covers product segment revenue performance for 2016 vs. 2015, while Exhibit 2 shows market share for each product segment. 

We’re happy to report these findings in greater detail in the Annual Report. Within this article we share a few highlights from each market segment, offering a glimpse of the top-ranked companies by revenue and market share, along with a brief description of main drivers for that segment. The number of companies listed varies from segment to segment, because we wanted to show where the top five companies fell within the ranking, as well as their percent of market share. We know that hundreds of companies impact the orthopaedic industry every day, and we look forward to covering more of those successes in the months to come. For us, a separate look at the top five companies by revenue—DePuy Synthes, Zimmer Biomet, Stryker, Smith & Nephew and Medtronic—is useful alongside the overall industry numbers shown in the Annual Report, because their size offers a high-level view of segment health and most heavily impacts industry performance, and therefore warrants extra attention. For example, the top four companies in the joint recon and trauma markets are the top four companies in the industry. They hold nearly 75% of both markets.

While Exhibits 1 and 2 illustrate product segment performance, Exhibit 3 covers company performance. Of note, 12 of the top 15 companies by revenue posted growth in 2016, and eight of those 12 experienced growth at or above the market rate of 3.2%. DePuy Synthes, Zimmer Biomet and Orthofix all returned to positive performance in 2016. These three exhibits will be helpful tools as you consider our observations.
 

Exhibit 1: Product Segment Performance ($Millions)

 

2016 

2015 

$ Change 

% Change 

 Joint Reconstruction

$17,506.3 

$16,897.6 

$608.7 

3.6% 

Knee 

$8,540.6 

$8,237.4 

$303.2 

3.7% 

Hip 

$6,983.6 

$6,825.1 

$158.5 

2.3% 

Extremities 

$1,982.1 

$1,835.0 

$147.1 

8.0% 

 Spine

$8,883.7 

$8,711.4 

$172.3 

2.0% 

 Trauma

$6,614.8 

$6,356.3 

$258.5 

4.1% 

 Arthroscopy/Soft Tissue

$5,009.0 

$4,744.6 

$264.4 

5.6% 

 Orthobiologics

$4,946.2 

$4,800.1 

$146.1 

3.0% 

 Other*

$5,198.3 

$5,147.2 

$51.1 

1.0% 

Total 

$48,158.3 

$46,657.1 

$1,501.2 

3.2% 

 

Exhibit 2: Market Share for Orthopaedic Product Sales 
 



 


*Other contains craniomaxillofacial, bone growth stimulation, bracing/soft goods and miscellaneous items like Zimmer Biomet’s forgings and Accelero and Stryker’s Performance Solutions.

 



Based on your company’s size or the segments within which you play, you may have felt the growth drivers differently than those that we outline. Clearly, this is just a glimpse of the market. The Annual Report provides a fuller overview of activity in each segment, as well as projections and predictions through 2021. At nearly 175 pages, we know that the report is a lot of information to digest, and we look forward to your feedback as you use it throughout the year. (Remember too that the Top Five company profiles are available for you to download here.)





Exhibit 3: Sales Performance: Top 15 Companies, Ranked by Revenue ($Millions)

 

2016 

2015 

$ Change 

% Change 

 DePuy Synthes

$9,003.5 

$8,931.2 

$72.3 

0.8% 

 Zimmer Biomet

$7,100.9 

$6,883.2 

$217.7 

3.2% 

 Stryker

$6,330.8 

$6,034.4 

$296.5 

4.9% 

 Smith & Nephew

$3,250.5 

$3,163.2 

$87.3 

2.8% 

 Medtronic

$2,930.0 

$2,932.0 

-$2.0 

-0.1% 

Top Five Total   

$28,615.7 

 $27,944.0 

$671.7 

2.4% 

 Arthrex

$2,048.0 

$1,833.1 

$214.9 

11.7% 

 DJO

$1,155.3 

$1,113.8 

$41.5 

3.7% 

 NuVasive

$962.1 

$811.1 

$150.9 

18.6% 

 Aesculap

$731.1 

$711.9 

$19.2 

2.7% 

 Wright Medical

$690.4 

$626.4 

$64.0 

10.2% 

 Globus Medical

$564.0 

$544.8 

$19.2 

3.5% 

 Sanofi

$450.2 

$455.1 

-$4.9 

-1.1% 

 Orthofix

$409.8 

$396.5 

$13.3 

3.4% 

 ConMed

$370.5 

$389.0 

-$18.5 

-4.8% 

 Musculoskeletal Transplant Foundation

$359.0 

$348.5 

$10.5 

3.0% 

Next Ten Total  

$7,740.3 

$7,230.2 

$510.1 

7.1% 

Remaining Companies  

$11,802.3 

$11,482.9 

$319.3 

2.8% 

Total  

$48,158.3 

$46,657.1 

$1,501.2 

3.2% 

 

 


 

Joint Recon Company Market Share and Ranking ($Millions) 
 



 
 
 
    Rank
 

         Who
 

      Revenue
 
 
        1          Zimmer Biomet $5,012.5  
        2          Stryker $3,408.1  
        3          Depuy Synthes $3,359.0  
        4          Smith & Newphew $1609.8  
        5          Aesculap $401.0  

 




JOINT RECONSTRUCTION


A stable U.S. and strengthened ex-U.S. market plus new product launches returned the joint reconstruction segment to growth in 2016. Declining hip and flat knee sales were the primary factors underlying 2015’s performance. We did not expect the market turnaround to occur by close of 2016, but we’re pleased to report that companies outperformed our projections. For 2016, joint reconstruction sales came in at $17.5 billion, a $608.7 million or 3.6% increase over 2015.

Joint reconstruction remains a priority segment for the industry’s largest players—DePuy Synthes, Zimmer Biomet, Stryker, Smith & Nephew and now, with the acquisition of Responsive Orthopedics, Medtronic as well. As is illustrated in the pie to the right, the top five players in joint reconstruction hold 79% of the market share.

Moving forward, the trends in joint reconstruction remain similar to previous years, with surgical assistance technologies, e.g. robotics and navigation, remaining a focus in hip and knee product launches, and total shoulder and ankle replacements driving the extremities recon market. We expect that companies will continue to roll out solutions for bundled payments, whether that be to track the full episode of care or portions of patient engagement.


 


 

Spine Company Market Share and Ranking ($Millions)
 



 
 
      Rank
 
         Who
 
      Revenue
 
 
        1          Medtronic $2,429.0  
        2          DePuy Synthes $1,600.0  
        3          NuVasive $804.1  
        4          Stryker $712.5  
        5          Globus $537.7  
        6          Zimmer Biomet $338.6  

 




SPINE


The spine market grew to meet our projections of 2% in 2016, reaching $8.8 billion (excludes biologics). Spine continues to be a slower-growing market, yet one with high activity.

Our estimates show that Medtronic and DePuy Synthes, the two largest players, posted flat and declining sales in 2016, respectively. The two companies lost market share for a second year, while NuVasive jumped Stryker to take the third position in the segment.

While Medtronic and DePuy Synthes have projected turnarounds for their spine businesses, other leading companies in the segment seek to take share through acquisitions and new product launches. NuVasive, Stryker, Globus Medical and Zimmer Biomet, companies three through six in segment ranking, closed spine-related acquisitions in 2016.

Spine has been a ripe arena for M&A, collaboration and funding activity in recent years, making the segment attractive for small companies seeking to enter and potentially exit the market. We believe that market share will continue to shift in this segment. At the same time, we believe that spine will remain attractive for smaller companies that are able to develop innovative and differentiated technologies.


 


 

 
Trauma Company Market Share and Ranking ($Millions)
 



 
 
     Rank
 
         Who
 
      Revenue
 
 
        1          Depuy Synthes $2,460.3  
        2          Stryker $1,265.6  
        3          Zimmer Biomet $536.3  
        4          Smith & Newphew $422.8  
        5          Wright Medical $267.1  

 




TRAUMA


The trauma market surpassed $6.6 billion in 2016. Four of the eight largest trauma players—DePuy Synthes, Zimmer Biomet, Smith & Nephew and Orthofix—posted losses in 2015. All returned to growth in 2016, except Smith & Nephew, which continues to face emerging market challenges. Revenue for the top five companies in this segment is depicted at right.

DePuy Synthes continues to dominate the trauma market, with 37% market share. In 2016, the company acquired BioMedical Enterprises in order to boost its small bone portfolio. DePuy was far from the only company focused on small bone enhancements in 2016. Foot and ankle remained a high-output segment for companies, with at least 11 companies making regulatory or product launch announcements in this area.

We expect that the companies in trauma will continue to innovate through materials, coatings and manufacturing processes in order to achieve greater fusion rates, reduce healthcare costs and eliminate the need for follow up surgeries.





 


 

AR/ST Market Share and Ranking ($Millions)
 



 
 
      Rank
 
         Who
 
      Revenue
 
 
        1          Arthrex $1,540.0  
        2          Smith & Nephew $1,218.0  
        3          DePuy Synthes $656.7  
        4          Stryker $461.5  
        5          ConMed $370.5  
        6          Zimmer Biomet $124.2  

 





ARTHROSCOPY/SOFT TISSUE REPAIR


The arthroscopy/soft tissue market surpassed $5.0 billion in 2016 with growth of 5.6%, more than 1% greater than our projections. Arthrex remains the segment leader, with more than 30% market share. The company’s growth is partially attributable to its breadth of arthroscopy/soft tissue products. In 2016, for instance, the company promoted arthroscope sets for hip procedures, biceps systems, shavers and synergy resection products for extremity surgeries.

Segment growth also continues to come from the diversified market leaders—specifically Stryker and Zimmer Biomet, which outperformed the market rate in 2016. Arthroscopy/soft tissue is expected to be an attractive market for companies that already have strong joint reconstruction portfolios, due to the ability to proactively treat patients who may experience joint wear and seek a quick return to active lifestyles. Stryker and Zimmer Biomet are prime examples. The companies were the only two that made acquisitions in this space in 2016, as they sought to expand their knee and extremity portfolios.







 


 

 
Orthobiologics Market Share and Ranking ($Millions)
 



 
 
      Rank
 
         Who
 
      Revenue
 
 
        1          Medtronic $501.0  
        2          Sanofi $450.2  
        3          DePuy Synthes $400.1  
        4          Arthrex $378.0  
        5          MTF $359.0  
        6          Zimmer Biomet $284.0  
        7          Seikagaku $269.9  
        8          Bioventus $265.1  
        9          Stryker $207.7  

 




ORTHOBIOLOGICS


The orthobiologics market grew to $4.9 billion in 2016, posting growth of 3% over 2015. Due to its cross-segment nature, the orthobiologics segment has multiple narratives. Medtronic, the leader in the segment with 10% market share, posted flat sales in 2016. NuVasive, SeaSpine and Orthofix, all spine players, posted orthobiologic losses in 2016. Leadership within these companies noted price pressure and competition among influencing factors.

With that said, osteoinductive products used in joint replacement and trauma and viscosupplements for early intervention performed well in 2016. Anika Therapeutics’ MONOVISC sales grew +54% vs. 2015, as the company’s orthobiologic revenue came in just under $90.0 million. DePuy Synthes, which licenses Anika’s ORTHOVISC and MONOVISC, continues to claim that the products are two of the company’s larger growth drivers.

Medtronic, Sanofi and DePuy Synthes were the only three companies in the top nine that did not post growth above the market rate.

Looking forward, we expect early intervention products to drive the market, as well as collaborations between companies.

 

 

Carolyn LaWell is Chief Content Officer for ORTHOWORLD. She can be reached via email.