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The top companies in orthopedics – those generating over $1 billion in annual revenue – dominate industry coverage. To broaden our view, we’ll dive deeper into three companies outside the U.S. in the $100 million to $300 million revenue bracket: LimaCorporate, Medartis and AK Medical. In addition to giving a brief overview for each, we’ll look at their 2019 and 1H20 revenue performance along with recent noteworthy corporate developments.
LimaCorporate
Based in Italy, LimaCorporate focuses on joint replacement and fixation. The company biases its hip portfolio toward cementless and revision implants. The complexity of those surgeries allows LimaCorporate to maintain profitability in the hip segment, where commoditization and price pressure have slowed growth in primary implants. In 2020, the company expanded its Physica brand knee replacement with new liners developed especially for the U.S. market. LimaCorporate and its Shoulder Modular Replacement system benefit from the more fragmented and less commoditized nature of the extremity joint replacement market.
Revenue Performance
LimaCorporate generated $250.7 million in revenue during 2019, growing +8.3% versus the prior year, as shown in Exhibit 1. We estimate that nearly 85% of that revenue came from hip and extremity joint replacement sales, as illustrated in Exhibit 2. Sales in the U.S. grew in the double digits for the second half of 2019, as the adoption of the Physica knee accelerated.
Exhibit 1: LimaCorporate Revenues
| Segment | 2018 | 2019 | 1H20 |
|---|---|---|---|
| Joint Replacement | $219.0 | $237.3 | $95.8 |
| Joint Replacement Growth % | 2.8% | 8.3% | -20.1% |
| Knees | $22.8 | $25.7 | $10.1 |
| Knees Growth % | 3.1% | 12.9% | -21.5% |
| Hips | $96.5 | $102.6 | $43.0 |
| Hips Growth % | 2.4% | 6.3% | -17.7% |
| Extremities | $99.7 | $109.0 | $42.8 |
| Extremities Growth % | 3.1% | 9.3% | -22.1% |
| Trauma | $12.5 | $13.4 | $5.7 |
| Trauma Growth % | 1.0% | 6.9% | -15.7% |
| Total | $231.6 | $250.7 | $101.5 |
| Total Growth % | 2.7% | 8.3% | -19.9% |
Recent Developments
Lima and the Hospital for Special Surgery in New York co-founded the first 3D printing facility for custom complex orthopedic implants in a hospital setting in early 2019. The facility initially will serve hospitals in the region, not just HSS patients, and longer-term plans include making devices accessible to providers across the U.S.
In early 2020, LimaCorporate completed the first total shoulder replacement using its Smart SPACE Shoulder Planner application. TechMah Medical, acquired by Lima in 2018, originally developed the software. The application uses a 3D patient-specific model derived from a CT-scan and is compatible with Lima’s entire shoulder portfolio. The software uses a machine-learning algorithm to draw upon an extensive library of morphological data points to design surgical plans. LimaCorporate expects to launch Smart SPACE for hip and knee replacements in the future.
Medartis
Switzerland-based Medartis is a trauma player with products for upper and lower extremities as well as craniomaxillofacial surgery. The company went public on the SIX Swiss Exchange in March 2018. Patrick Christ, Medartis’ Head of Corporate Services, attributes the company’s success to close collaboration with experts in product development and education. He pointed to Medartis innovations like TriLock® locking technology, the HexaDrive® self-holding screw and screwdriver and the SpeedTip® screw as the fruits of such close collaboration.
Revenue Performance
Medartis generated $137.6 million in revenue for 2019, +7.2% versus the prior year, as is shown in Exhibit 3. Trauma comprises 83% of the company’s revenue, as is illustrated in Exhibit 4. Growth in 2019 decelerated slightly compared to 2018 (+9.4%), mainly due to sub-par distributor performance. However, both the U.S. and Latin American markets performed well, growing +12.4% and +11.6%, respectively.
Exhibit 3: Medartis Revenues
| Segment | 2018 | 2019 | 1H20 |
|---|---|---|---|
| Trauma | $109.5 | $117.3 | $52.4 |
| Trauma Growth % | 15.6% | 7.0% | -9.7% |
| Other (CMF) | $18.8 | $20.3 | $7.8 |
| Other (CMF) Growth % | 15.6% | 7.9% | -22.9% |
| Total | $128.4 | $137.6 | $60.3 |
| Total Growth % | 9.4% | 7.2% | -11.6% |
The shutdown of elective procedures due to COVID impacted Medartis, but the company’s strong start to the year and quick return to growth by June mitigated declines. For the first half of 2020, Medartis revenue declined by -11.6%. That result is in line with the overall trauma market, reflecting that segment’s insulation from procedure deferrals due to its less elective nature. Patrick Christ said, “The return to sales growth in June reflects Medartis’ strong position in key markets, established product lines and effective preparation for return to a post-lockdown environment.”
Recent Developments
Despite the pandemic, Medartis is forging ahead with its previously planned goals and priorities. The company is prioritizing regional sales focus with new executive-level appointments, including Lisa Thompson (President of Medartis North America) and Mareike Loch (Vice President EMEA). As part of new incentives for the sales team, the company reaffirmed its commitment to training with the appointment of Peter Cologna as Head of Education. To further develop its U.S. market presence, Medartis expanded select territories there and increased the focus on meeting sales quotas for distributors.
Recently appointed Chief Technology Officer Manuel Schaer is heading the company’s effort to expand its innovation pipeline and reduce time to market. In the first half of 2020, the company launched a forearm fracture system, clavicula system, CCS compression screw extension, mid-hindfoot system, distal ankle fracture system and a next-generation CMF system including 3D planning software and cutting guides.
AK Medical
China-based player AK Medical focuses on the application of 3D printing technology for use in orthopedic joint and spine surgery. AK Medical leveraged the evolving skill of surgeons and the aging population in China to drive rapid growth. AK Medical is the first orthopedic company to launch 3D-printed metal implants approved by the Chinese National Medical Products Administration (NMPA). The company has five certificates for 3D printing from the NMPA covering an acetabular cup, spinal interbody cages, artificial vertebral bodies, a pelvic defect matching prosthesis and a customized cervical fusion device.
Revenue Performance
AK Medical generated $127.3 million in 2019, growing an impressive +54.1% compared to the prior year, as shown in Exhibit 5. Over 95% of AK Medical’s revenue comes from its knee and hip replacement products, as illustrated in Exhibit 6. The company’s 3D-printed portfolio generated $17.4 million in 2019, growing +76.5%.
Exhibit 5: AK Medical Revenues
| Segment | 2018 | 2019 | 1H20 |
|---|---|---|---|
| Joint Replacement | $78.7 | $121.3 | $61.3 |
| Joint Replacement Growth % | 59.0% | 54.1% | 6.6% |
| Knees | $21.8 | $33.6 | $17.8 |
| Knees Growth % | 52.5% | 54.3% | 8.4% |
| Hips | $56.9 | $87.7 | $43.5 |
| Hips Growth % | 61.7% | 54.0% | 5.9% |
| Spine | $3.9 | $6.1 | $3.5 |
| Spine Growth % | 91.1% | 54.7% | 26.1% |
| Trauma | $0.0 | $0.0 | $1.1 |
| Trauma Growth % | |||
| Total | $82.6 | $127.3 | $65.9 |
| Total Growth % | 60.3% | 54.1% | 9.3% |
Despite China’s early exposure to COVID, AK Medical grew +9.4% in the first half of 2020. The company’s 3D-printed products continued their steep climb with +18.1% growth for the half. AK Medical’s knee and hip sales performed better than the overall market for the period, growing +8.4% and +5.9%, respectively, for 1H20.
Recent Developments
In August 2020, AK Medical expanded its 3D printing capacity by investing in eight GE Arcam EMB 3D printers. Company Chairman and CEO Li Zhijiang believes that 3D printing is one of the highest potential technologies in orthopedics.
“Additive technology itself is tremendously advantageous in terms of cost, and personalized customization is increasingly becoming an industry trend. When you begin to think of it in combination with CT, nuclear MRI, software, the Internet, 5G and many other technologies, then additive is likely to unleash greater potential to boost the entire medical industry,” he said.
AK Medical bolstered its spine and trauma portfolios in the first half when it completed the acquisition of Chinese player Libeier, formerly a subsidiary of Medtronic China Kanghui Holdings. In China, each province undertakes volume-based procurement of orthopedic products. In 1H20, AK Medical won a tender to supply joint products to Fujian province.
LimaCorporate, Medartis and AK Medical are three innovative companies focusing on fast-growing subsegments like extremities and 3D printing. While COVID knocked the entire orthopedic industry off course, these three players are well-positioned to rebound in the second half of 2020 and win market share from peers.
Mike Evers is ORTHOWORLD’s Digital Content Strategist.
The top companies in orthopedics – those generating over $1 billion in annual revenue – dominate industry coverage. To broaden our view, we’ll dive deeper into three companies outside the U.S. in the $100 million to $300 million revenue bracket: LimaCorporate, Medartis and AK Medical. In addition to giving a brief overview for each, we’ll look at...
The top companies in orthopedics – those generating over $1 billion in annual revenue – dominate industry coverage. To broaden our view, we’ll dive deeper into three companies outside the U.S. in the $100 million to $300 million revenue bracket: LimaCorporate, Medartis and AK Medical. In addition to giving a brief overview for each, we’ll look at their 2019 and 1H20 revenue performance along with recent noteworthy corporate developments.
LimaCorporate
Based in Italy, LimaCorporate focuses on joint replacement and fixation. The company biases its hip portfolio toward cementless and revision implants. The complexity of those surgeries allows LimaCorporate to maintain profitability in the hip segment, where commoditization and price pressure have slowed growth in primary implants. In 2020, the company expanded its Physica brand knee replacement with new liners developed especially for the U.S. market. LimaCorporate and its Shoulder Modular Replacement system benefit from the more fragmented and less commoditized nature of the extremity joint replacement market.
Revenue Performance
LimaCorporate generated $250.7 million in revenue during 2019, growing +8.3% versus the prior year, as shown in Exhibit 1. We estimate that nearly 85% of that revenue came from hip and extremity joint replacement sales, as illustrated in Exhibit 2. Sales in the U.S. grew in the double digits for the second half of 2019, as the adoption of the Physica knee accelerated.
Exhibit 1: LimaCorporate Revenues
| Segment | 2018 | 2019 | 1H20 |
|---|---|---|---|
| Joint Replacement | $219.0 | $237.3 | $95.8 |
| Joint Replacement Growth % | 2.8% | 8.3% | -20.1% |
| Knees | $22.8 | $25.7 | $10.1 |
| Knees Growth % | 3.1% | 12.9% | -21.5% |
| Hips | $96.5 | $102.6 | $43.0 |
| Hips Growth % | 2.4% | 6.3% | -17.7% |
| Extremities | $99.7 | $109.0 | $42.8 |
| Extremities Growth % | 3.1% | 9.3% | -22.1% |
| Trauma | $12.5 | $13.4 | $5.7 |
| Trauma Growth % | 1.0% | 6.9% | -15.7% |
| Total | $231.6 | $250.7 | $101.5 |
| Total Growth % | 2.7% | 8.3% | -19.9% |
Recent Developments
Lima and the Hospital for Special Surgery in New York co-founded the first 3D printing facility for custom complex orthopedic implants in a hospital setting in early 2019. The facility initially will serve hospitals in the region, not just HSS patients, and longer-term plans include making devices accessible to providers across the U.S.
In early 2020, LimaCorporate completed the first total shoulder replacement using its Smart SPACE Shoulder Planner application. TechMah Medical, acquired by Lima in 2018, originally developed the software. The application uses a 3D patient-specific model derived from a CT-scan and is compatible with Lima’s entire shoulder portfolio. The software uses a machine-learning algorithm to draw upon an extensive library of morphological data points to design surgical plans. LimaCorporate expects to launch Smart SPACE for hip and knee replacements in the future.
Medartis
Switzerland-based Medartis is a trauma player with products for upper and lower extremities as well as craniomaxillofacial surgery. The company went public on the SIX Swiss Exchange in March 2018. Patrick Christ, Medartis’ Head of Corporate Services, attributes the company’s success to close collaboration with experts in product development and education. He pointed to Medartis innovations like TriLock® locking technology, the HexaDrive® self-holding screw and screwdriver and the SpeedTip® screw as the fruits of such close collaboration.
Revenue Performance
Medartis generated $137.6 million in revenue for 2019, +7.2% versus the prior year, as is shown in Exhibit 3. Trauma comprises 83% of the company’s revenue, as is illustrated in Exhibit 4. Growth in 2019 decelerated slightly compared to 2018 (+9.4%), mainly due to sub-par distributor performance. However, both the U.S. and Latin American markets performed well, growing +12.4% and +11.6%, respectively.
Exhibit 3: Medartis Revenues
| Segment | 2018 | 2019 | 1H20 |
|---|---|---|---|
| Trauma | $109.5 | $117.3 | $52.4 |
| Trauma Growth % | 15.6% | 7.0% | -9.7% |
| Other (CMF) | $18.8 | $20.3 | $7.8 |
| Other (CMF) Growth % | 15.6% | 7.9% | -22.9% |
| Total | $128.4 | $137.6 | $60.3 |
| Total Growth % | 9.4% | 7.2% | -11.6% |
The shutdown of elective procedures due to COVID impacted Medartis, but the company’s strong start to the year and quick return to growth by June mitigated declines. For the first half of 2020, Medartis revenue declined by -11.6%. That result is in line with the overall trauma market, reflecting that segment’s insulation from procedure deferrals due to its less elective nature. Patrick Christ said, “The return to sales growth in June reflects Medartis’ strong position in key markets, established product lines and effective preparation for return to a post-lockdown environment.”
Recent Developments
Despite the pandemic, Medartis is forging ahead with its previously planned goals and priorities. The company is prioritizing regional sales focus with new executive-level appointments, including Lisa Thompson (President of Medartis North America) and Mareike Loch (Vice President EMEA). As part of new incentives for the sales team, the company reaffirmed its commitment to training with the appointment of Peter Cologna as Head of Education. To further develop its U.S. market presence, Medartis expanded select territories there and increased the focus on meeting sales quotas for distributors.
Recently appointed Chief Technology Officer Manuel Schaer is heading the company’s effort to expand its innovation pipeline and reduce time to market. In the first half of 2020, the company launched a forearm fracture system, clavicula system, CCS compression screw extension, mid-hindfoot system, distal ankle fracture system and a next-generation CMF system including 3D planning software and cutting guides.
AK Medical
China-based player AK Medical focuses on the application of 3D printing technology for use in orthopedic joint and spine surgery. AK Medical leveraged the evolving skill of surgeons and the aging population in China to drive rapid growth. AK Medical is the first orthopedic company to launch 3D-printed metal implants approved by the Chinese National Medical Products Administration (NMPA). The company has five certificates for 3D printing from the NMPA covering an acetabular cup, spinal interbody cages, artificial vertebral bodies, a pelvic defect matching prosthesis and a customized cervical fusion device.
Revenue Performance
AK Medical generated $127.3 million in 2019, growing an impressive +54.1% compared to the prior year, as shown in Exhibit 5. Over 95% of AK Medical’s revenue comes from its knee and hip replacement products, as illustrated in Exhibit 6. The company’s 3D-printed portfolio generated $17.4 million in 2019, growing +76.5%.
Exhibit 5: AK Medical Revenues
| Segment | 2018 | 2019 | 1H20 |
|---|---|---|---|
| Joint Replacement | $78.7 | $121.3 | $61.3 |
| Joint Replacement Growth % | 59.0% | 54.1% | 6.6% |
| Knees | $21.8 | $33.6 | $17.8 |
| Knees Growth % | 52.5% | 54.3% | 8.4% |
| Hips | $56.9 | $87.7 | $43.5 |
| Hips Growth % | 61.7% | 54.0% | 5.9% |
| Spine | $3.9 | $6.1 | $3.5 |
| Spine Growth % | 91.1% | 54.7% | 26.1% |
| Trauma | $0.0 | $0.0 | $1.1 |
| Trauma Growth % | |||
| Total | $82.6 | $127.3 | $65.9 |
| Total Growth % | 60.3% | 54.1% | 9.3% |
Despite China’s early exposure to COVID, AK Medical grew +9.4% in the first half of 2020. The company’s 3D-printed products continued their steep climb with +18.1% growth for the half. AK Medical’s knee and hip sales performed better than the overall market for the period, growing +8.4% and +5.9%, respectively, for 1H20.
Recent Developments
In August 2020, AK Medical expanded its 3D printing capacity by investing in eight GE Arcam EMB 3D printers. Company Chairman and CEO Li Zhijiang believes that 3D printing is one of the highest potential technologies in orthopedics.
“Additive technology itself is tremendously advantageous in terms of cost, and personalized customization is increasingly becoming an industry trend. When you begin to think of it in combination with CT, nuclear MRI, software, the Internet, 5G and many other technologies, then additive is likely to unleash greater potential to boost the entire medical industry,” he said.
AK Medical bolstered its spine and trauma portfolios in the first half when it completed the acquisition of Chinese player Libeier, formerly a subsidiary of Medtronic China Kanghui Holdings. In China, each province undertakes volume-based procurement of orthopedic products. In 1H20, AK Medical won a tender to supply joint products to Fujian province.
LimaCorporate, Medartis and AK Medical are three innovative companies focusing on fast-growing subsegments like extremities and 3D printing. While COVID knocked the entire orthopedic industry off course, these three players are well-positioned to rebound in the second half of 2020 and win market share from peers.
Mike Evers is ORTHOWORLD’s Digital Content Strategist.
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Mike Evers is a Senior Market Analyst and writer with over 15 years of experience in the medical industry, spanning cardiac rhythm management, ER coding and billing, and orthopedics. He joined ORTHOWORLD in 2018, where he provides market analysis and editorial coverage.
