Orthopedic Executives Reflect on 2024’s First Half

We knew the orthopedic market would have a tougher road this year than it did in 2023. The market performed well in 2024’s first half, growing in the mid-single digits, according to our estimates. But demand is regressing to baseline and there are a few worrisome pockets.

Below are selected comments from leaders of the top orthopedic companies as they reflect on the importance of enabling technology, an abundance of international opportunities and challenges in the market.

Adding Technology Options to Drive Adoption

Digital technology is rapidly changing orthopedic surgery. Companies remain focused on smoothing out workflow pain points while providing optionality for surgeons and the ways they interact with technology.

Matt Trerotola, Enovis CEO

It’s clear that enabling technology is going to be important to shoulder surgeons going forward. Guidance is a tremendous solution when you have the more constrained space that you have in a shoulder. Also, the average shoulder surgeon does a lot fewer procedures than the average hip or knee surgeon. The initial reactions we’ve had to ARVIS have been very positive. A low-cost solution that is time efficient is going to be a great solution for lower volume shoulders out there.

Ivan Tornos, Zimmer Biomet CEO

TMINI is not going to replace ROSA, just like OrthoGrid is not going to replace ROSA. It’s all about having breadth of portfolio. What I will tell you is that we are deeply committed to ROSA, which continues to be one of the fastest-growing platforms here at Zimmer Biomet. We’re very pleased with where we are with ROSA, but we know we need to have optionality, and we like our chances when it comes to that.

Pat Miles, ATEC CEO

Let’s start with an explanation around the preoperative experience. The reason most surgeons do not plan surgery is that it is onerous. It often takes a very long time, and it’s imprecise. You’re dealing with non-standard imaging modalities where magnification and other challenges undermine accuracy. In short, it is a lot of work for little precision and objective value. So, it’s just not done often.

International Opportunities Abound for Top Players

While the United States remains the key strategic market for most players, companies are finding tremendous growth opportunities in other geographies.

Ivan Tornos, Zimmer Biomet CEO

Fifteen countries account for 95% of the overall market potential. In the past, we’ve been all over the place. In the last two years, we refocused the strategy to those key markets that matter the most. OpEx and CapEx are being reallocated to those geographies. Our commercial infrastructure has been modified in those countries, and the way that we focus in those countries is different.

Kevin Lobo, Stryker CEO

There are two tips of the spear in international. One is Mako and the other is the 1788 camera. They create pull through of other Stryker business. We’re seeing that in multiple countries. Because our market shares are a little bit lower internationally, as we get Makos placed more of that business is coming from competitive accounts than they were in the United States. We have discovered that those are the two important platforms.

Joaquin Duato, Johnson & Johnson CEO

We were one of the first companies that started to operate in China, and we’ve been in China for decades. We have a history of constructive engagements with China, and we are looking forward for that to continue. We recognize the situation, and we have robust business continuity planning practices in place; we are able to mitigate any potential exposure. But we continue to see China as an important growth driver, both for our Innovative Medicine business and for our MedTech business.

Procedure Demand Healthy, but Some Warning Signs

While the overall market is healthy compared to prior years, suppliers and some pure-play device companies are finding it difficult to weather the ebb and flow of the market as it normalizes slowly.

Curt Hartman, CONMED CEO

Part of the challenge is variability and surprise in our supplier base. As an example, we’ve had seven suppliers unexpectedly close their doors on us this year. Not just us, but everybody they were serving. This is not a business where you can just rapidly pick things up and start producing them tomorrow night after they close tonight. It takes time and validation and qualification, and it only takes one component to put a product on a supply constraint.

John Treace, Treace Medical Concepts CEO

We identified those [foot and ankle] softening trends late in Q1, and we saw them continue through April; that resulted in our guidance change in early May. We spoke at that time predominantly about increasing headwinds from customers trialing some of these Lapiplasty knockoffs and some more mounting interest in MIS osteotomies. I am aware of that large player that said they saw a soft first half, as well.

Jason Beach, Stryker VP, Investor Relations

Procedural volumes remained robust in the second quarter driven by strong fundamentals, increased adoption of robotic assisted surgery and healthy patient activities with surgeons. We continue to expect strength in procedural demand as we move into the second half of the year.