Orthopedic Market Size and Share
November 2023
Mike Evers, Senior Market Analyst
Welcome to our overview of the orthopedic market. This page and the Segment Reports build upon our work in THE ORTHOPAEDIC INDUSTRY ANNUAL REPORT®. The market ran hot through the first half of 2023. We’re awaiting third-quarter earnings from the big ortho players. With those in hand, we’ll update this page and our 2023 projections later this month. See you soon!
The Market at a Glance
In a year with largely stable surgical volumes, the orthopedic market grew 3.5% in 2022 to $55.5 billion worldwide. Familiar headwinds like supply chain disruption and hospital staffing shortages persist but procedure volumes, particularly in joint replacement, remain healthy.
Orthopedic Sales by Product Segment
Joint replacement volumes started a rebound in 2022 after two years of lagging recovery compared to other orthopedic segments. The knee and hip replacement categories finished above their historical averages, growing 4.9% and 3.8%, respectively. Trauma experienced a softer market in 2022, exacerbated by volume-based procurement (VBP) in China.
Exhibit 1: Worldwide Orthopedic Sales by Product Segment ($millions)
| Product Segment | FY22 | FY21 | $ Chg | % Ch |
|---|---|---|---|---|
| Joint Replacement | $20,007.8 | $19,101.8 | $905.9 | 4.7% |
| Spine | $9,868.2 | $9,676.3 | $191.9 | 2% |
| Trauma | $8,001.0 | $7,778.8 | $222.2 | 2.9% |
| Sports Medicine | $6,301.1 | $6,046.7 | $254.3 | 4.2% |
| Orthobiologics | $5,317.9 | $5,212.6 | $105.3 | 2% |
| Enabling Technology | $1,192.3 | $1,103.5 | $88.9 | 8.1% |
| Other | $4,803.5 | $4,718.5 | $84.9 | 1.8% |
| Total | $55,491.7 | $53,638.3 | $1,853.5 | 3.5% |
Segment Reports
Joint Replacement Implant Market
October 26, 2023
Spine Implant Market
October 26, 2023
Trauma Implant Market
October 26, 2023
Sports Medicine Market
October 26, 2023
Orthobiologics Market
October 26, 2023
Enabling Technology Market
October 26, 2023
Market Forecast
The orthopedic market’s post-pandemic recovery gathered momentum in the second half of 2022. Orthopedic surgery volumes improved further in 2023, with a catch-up on joint replacement procedures providing the biggest tailwind. However, macro challenges like supply chain constraints and hospital staffing shortages are likely to persist throughout 2024.
We project orthopedic market sales to surpass $57.3 billion in 2023 and maintain 3% growth yearly until reaching nearly $64 billion in 2026.
Exhibit 2: Worldwide Orthopedic Sales by Year ($millions)
Get More Orthopedic Market Data. Download the Orthopedic Revenue Matrix for our most complete and granular numbers. It contains worldwide orthopedic sales for 67 public and private companies by segment from 2016 through 2022.
Lingering disruption, rebounding orthopedic procedure volumes and changes to the Chinese market were among the many factors informing our forecast.
Lingering Disruptions in Supply and Staffing
Supply chain disruptions are having wide-ranging impacts on most companies. Zimmer Biomet’s former CEO Bryan Hanson said supply challenges weren’t merely on resins and packaging, but on “almost everything we deal with.” Meanwhile, CONMED CEO Curt Hartman offered a blunt assessment of the staffing situation when he predicted that it wouldn’t be resolved until 2024.
Procedure Volumes Healthy and Stable
Procedure volumes in most product segments and geographic regions normalized in 2022 despite COVID-19 surges and high incidences of respiratory illness and flu during the year. Volume trends maintained healthy levels through 2023, with joint replacement overperforming after several years of disruption.
Volume-based Procurement (VBP) in China
Companies are re-evaluating their strategies as joint replacement, trauma and spinal implants come under national VBP tenders in China. Players like ZimVie and Medartis left China, while Smith+Nephew pulled its trauma products from the market. Joint replacement implant prices declined more than 80% due to the national tender. That impact anniversaried out in mid-2023.
Domestic Chinese players like MicroPort and AK Medical saw their market access increase significantly due to VBP. Global players like DePuy Synthes and Zimmer Biomet won’t have the same upside, but remain committed to the Chinese market.
Sales by Region
Orthopedic sales outside of the U.S. recovered well throughout 2022, despite volatility due to COVID in countries like China, Australia and Brazil. Globalized companies faced currency headwinds as the U.S. dollar hit a two-decade high during the year. DePuy Synthes’ full-year international sales, for example, lost 9% to currency translation.
VBP in China changed the way global companies approach that market for impacted segments. ZimVie opted to leave the Chinese spine market, and Smith+Nephew did the same in trauma. Companies will lap the impact of VBP in joint replacement in mid-2023 and hope to offset the price cuts with increased volume.
The European Union’s Medical Device Regulation (MDR) has forced companies to reconsider their strategy in the region. MDR is a stricter regulation than the Medical Device Directive, and orthopedic companies are choosing to pull products from the market to ease the regulatory burden.
MDR’s transition deadline has been postponed from 2024 to 2027 or 2028, depending on the type of device. Startups to large players are expected to de-emphasize European Union countries moving forward.
U.S. sales make up 67% of the orthopedic market. U.S. orthopedic sales reached $37 billion in 2022, while OUS sales surpassed $18.4 billion.
Exhibit 3: Orthopedic Sales by Region ($millions)
| Region | FY22 | FY21 | $ Ch | % Chg |
|---|---|---|---|---|
| US | $37,059.8 | $35,169.2 | $1,890.7 | 5.4% |
| OUS | $18,431.9 | $18,469.1 | ($37.2) | (0.2%) |
| EMEA | $10,100.9 | $9,792.5 | $308.4 | 3.1% |
| APAC | $6,460.8 | $6,814.7 | ($354.0) | (5.2%) |
| ROW | $1,870.2 | $1,861.8 | $8.4 | 0.5% |
| Total | $55,491.7 | $53,638.3 | $1,853.5 | 3.5% |
Exhibit 4: Orthopedic Market Share by Region ($millions)
Top Companies
The orthopedic market has more than 1,000 active companies, which we categorize into five tiers based on global annual revenue:
- Over $1 billion
- Between $400 million and $999 million
- Between $200 million and $399 million
- Between $100 million and $199 million
- All other companies below $100 million
Only 46 of the 1,000+ companies generated more than $100 million in orthopedic revenue in 2022, according to our estimates. Those companies account for 84% of all orthopedic sales. We expect the largest companies to consolidate more market share as merger and acquisition activity accelerates in 2023 after two slower years.
Exhibit 5: Orthopedic Market Share by Company Tier ($millions)
Companies Over $1 Billion
The companies in this tier grew an average of 2% in 2022 vs. 2021. Highly globalized companies like DePuy Synthes, Zimmer Biomet and Smith+Nephew saw currency headwinds in the mid-single digits, which impacted their growth.
Globus Medical had an eventful 2022 and 1Q23 in which it entered the top tier of orthopedic players and announced its intention to acquire NuVasive, its closest competitor. Despite a chilly reaction from Wall Street and some regulatory questions, Globus closed the acquisition on time in the third quarter of 2023.
Exhibit 6: Orthopedic Sales for Top-Tier Players ($millions)
| Company | FY22 | FY21 | $ Chg | % Chg |
|---|---|---|---|---|
| Stryker | $9,416.2 | $9,035.9 | $380.2 | 4.2% |
| DePuy Synthes | $8,586.4 | $8,584.1 | $2.3 | 0% |
| Zimmer Biomet | $6,939.9 | $6,827.3 | $112.6 | 1.6% |
| Smith+Nephew | $3,611.5 | $3,644.8 | ($33.2) | (0.9%) |
| Medtronic | $3,212.7 | $3,221.6 | ($9.0) | (0.3%) |
| Arthrex | $2,828.6 | $2,679.5 | $149.1 | 5.6% |
| NuVasive | $1,201.9 | $1,139.0 | $63.0 | 5.5% |
| Globus Medical | $1,022.8 | $958.1 | $64.7 | 6.8% |
| Subtotal | $36,820.0 | $36,090.4 | $729.7 | 2% |
| Market Total | $55,491.7 | $53,638.3 | $1,853.5 | 3.5% |
Here are a few of the developments that we’re watching among the top-tier players.
Doubling Down on Spine
Globus Medical seemed poised for a big acquisition over the last few years, and finally made its move in 2023. The decision to acquire NuVasive and double down on spine surprised many in the industry. Spine company integrations historically lead to significant dissynergies. The culture gap between the companies is noteworthy. Still, if Globus Medical can manage through the integration with minimal disruption, it could quickly become a credible threat to market-leading Medtronic.
Smith+Nephew’s 12-Point Plan
The pandemic revealed some vulnerabilities at Smith+Nephew, resulting in a reorganization and leadership change. The company seems to be through the worst of its challenges and is now implementing CEO Deepak Nath’s 12-point plan. Five of those points aim to revitalize its orthopedic business, but company leadership admitted that it faces a long road to regaining momentum.
Changes in Capital Purchasing Models
Upfront capital sales of enabling technologies helped top-tier players like Stryker, Medtronic and Globus Medical soften the impact of reduced implant sales during the worst of the pandemic. By mid-2021, prolonged economic uncertainty and a more crowded robotics market changed the way hospitals acquired orthopedic technology. Options like rentals and volume-based “earnout” placements now spread the incremental revenue across longer periods.
Get Market Data for More Companies. Download the Orthopedic Revenue Matrix for our most complete and granular numbers. It contains worldwide orthopedic sales for 67 public and private companies by segment from 2016 through 2022.
Companies Between $400 Million and $999 Million
This tier remains highly active. Globus Medical outgrew this category in 2022, and Enovis’ reconstruction business will likely do the same over the next few years. The combined organization of Orthofix and SeaSpine weighs in near the top of this group in 2023, with projected orthopedic sales of $750 million.
Players between $400 million and $999 million made up 7.4% of the orthopedic market in 2022. Here are some of the things that we’re watching among these companies.
If You Work in Recon, You Must Grow in Double-Digits
Enovis generated $599.4 million in 2022. The company’s reconstruction business met high expectations once again and grew at multiples of the market average thanks to its highly regarded implants, deep ASC penetration and ability to seamlessly integrate acquired companies. Recently acquired companies showed double-digit growth in 2022 and have started to scale. Enovis will likely remain active on the M&A front.
ZimVie Turnaround a Long-term Play
In its first year post-spin from Zimmer Biomet, the company took necessary steps in its years-long transformation. ZimVie prioritized making cuts to right-size its business. It exited some unprofitable geographies and began the process of optimizing its portfolio. The company ended 2022 with $449.8 million in orthopedic sales.
ZimVie also canceled time-consuming, low-return projects. The company expects to return its spine business to growth within five years by focusing on faster-growing markets like motion preservation, minimally invasive surgery and enabling technology.
Hyaluronic Acid Reimbursement Changes Hurt Bioventus
In mid-2022, the company reported that changes to hyaluronic acid reimbursement from wholesale acquisition cost to average selling price could hinder sales growth. That impact was worse than expected, with Bioventus’ Gelsyn 3-injection product declining in the high-teens during the second half of 2022.
Bioventus reported 2022 orthopedic sales of $440 million, but changed leadership and saw declines through the first half of 2023.
Companies Between $200 Million and $399 Million
The 10 players in this tier generated 5.2% of all orthopedic sales in 2022. ATEC is one of the better growth stories in orthopedics, so its stay in this tier will be brief. ATEC projected orthopedic sales of more than $400 million for 2023, and it recently acquired robotic technology from Accelus.
Below are a few of the storylines that we’re following for companies in the $200 million to $399 million revenue tier.
Not a Division of a Division
ATEC attributes its rapid growth to its singular focus on spine surgery, which fosters a winning culture and a commitment to the whole clinical experience. The company topped $350 million in sales for 2022.
CEO Pat Miles said that ATEC will never be a division of a division or a conglomerate acquiring growth. Given recent acquisitions in spine, ATEC expects to benefit from the resulting dissynergies. “We love chaos,” Mr. Miles said.
Medartis Faced Headwinds in Strategic Markets
While the company turned in a strong 2022 with $203 million in revenue, results were impacted by challenges in the Asia Pacific region and the U.S. COVID lockdowns stunted sales in Australia and New Zealand, and Medartis opted to leave the Chinese market due to VBP. Hospital staffing shortages hurt the company’s U.S. sales, which faced a difficult prior-year comparison.
MicroPort Expands Access Through VBP
The company generated orthopedic sales over $250 million in 2022. Revenues in China declined sharply due to VBP reductions and the COVID pandemic. However, MicroPort’s market access increased dramatically under the national tender.
Its joint replacement products entered 140 new hospitals, a 10% increase in its national coverage. VBP also brought a major breakthrough for the company’s spine and trauma products, adding access to 200 more hospitals and doubling its previous total.
Companies Between $100 Million and $199 Million
The $100 million to $199 million tier accounted for 5.3% of worldwide orthopedic sales in 2022. As a group these 20 companies grew in the double digits, paced by strong performances from pure-play foot and ankle companies.
Below are a few of the trends that we’re watching for this diverse group of companies.
Foot and Ankle in Focus
Paragon 28 and Treace Medical Concepts are two pure-play disruptors taking on large incumbents within foot and ankle. Paragon 28 finished 2022 with $181 million in sales, while Treace grew to $142 million. The segment is very diverse in terms of treatments and products. Paragon 28 estimates that the entire foot and ankle market will grow 7% annually from 2021 through 2025 to a total of $5.6 billion.
Low Volume-Based Procurement Tender Pays Off for AK Medical
The Chinese company ranked first among all participating players in the VBP joint replacement rollout with an allotment of 81,000 pieces, more than 15% of the tender’s total first-year volume. AK Medical’s hospital access grew to nearly 3,500, of which 953 are newly-covered hospitals. The newfound access should allow the company to build upon the $144 million in orthopedic sales it generated in 2022.
Anika’s Regenerative Products Makes Strides
Anika Therapeutics amassed $145 million in orthopedic sales for 2022 while it progressed market expansion opportunities for its regenerative products. The company plans to grow Tactoset’s market to more than $100 million by gaining 510(k) clearances for additional hardware augmentation indications. A new rotator cuff patch system in 2024 and a longer-term opportunity with Hyalofast could expand Anika’s target addressable market by an additional $500 million.
OrthoPediatrics Overcomes Record RSV Cases
The company’s strong 2022 performance ended with $122 million in sales, continuing a trend of annual growth in excess of 20% since its inception in 2006, with the exception of pandemic-ridden 2020. Deeper account penetration and synergies from recent acquisitions are driving the company’s growth.
Important Trends in Orthopedics
Companies Pivoting R&D Dollars to Digital
Skip Kiil, President of Medtronic’s Cranial and Spinal Technologies Division, said that the company’s R&D efforts are disproportionately slanted toward technology. Bryan Hanson, former President and CEO of Zimmer Biomet, previously said that more than 70% of the company’s development dollars are spent on the ZBEdge ecosystem of digital technologies.
Companies of all sizes are investing in new technologies, with an increasing focus on integrated monitoring through more of the patient journey to enable predictive analytics.
Orthopedic M&A Returning, IPOs Still Frozen
Orthopedic M&A activity accelerated between 2017 and 2020. The pandemic brought unprecedented orthopedic funding and M&A markets, culminating in 42 transactions in 2020. Since then, deal volume declined more than 40% in 2021 and dropped another 12% in 2022. However, the market is on pace for slightly more M&A activity in 2023.
On the IPO front, the door effectively slammed shut just after Treace Medical Concepts, Bioventus and Paragon 28 went public in 2021 amid a highly favorable landscape. Sustained economic pressure is likely to limit orthopedic IPOs in 2024.
Acceleration of Procedures in ASCs Driving Design Considerations
Both implants and enabling technologies are being designed specifically for the ASC setting. Anika Therapeutics’ RevoMotion shoulder implant features a streamlined two tray design.
Enovis’ EMPOWR 3D knee is a proven winner in the ASC market. The company recently added the ARVIS navigation system to its portfolio, prioritizing improved accuracy and efficiency at a lower cost and smaller footprint than traditional navigation systems. Midsized and smaller companies have targeted the ASC market for years and will face mounting pressures from large players with new aggressive strategies.
Further Reading
Thanks for visiting! Need more insight into the orthopedic market? Questions and comments are always welcome. You can reach me by email. I’ll be back soon with updates to this page as we complete our projections for the 2023 finish.
The posts below feature some of the biggest developments and trends in orthopedics that we’re watching for 2024.
