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Ali MADANIPhone: + 33 1 47 78 46 00
2
TUTORIAL
Orthopaedics Market
June 2015
Table of contents
Worldwide orthopaedic market: dynamics, competition, drivers, limiters, … Worldwide orthopaedic markets in 2014: hip, knee, trauma, spine, others…
Worldwide orthopaedic Market: products, innovations, growth, competition & trends
Market drivers, market limiters
Forecasts by 2018
European orthopaedic market: market share, new products in details, heavy trends, …
European orthopaedic markets in 2014: market share for hip, knee & shoulder
European orthopaedic Market: new products, trends…
Forecasts by 2018
Summaries
I
II
III
Survey Methodology
Methodology
3
Ali MADANI
Phone: + 33 1 47 78 46 00
Direct Interviews with decision
makers thanks to strong links with
CEOs, R&D, Marketing,
surgeons,... & Cross-checking
Information Process
20 years of historical data on
orthopedic & contract
manufacturing market and
competitors & continuous tracking
Highly detailed segmentation
All products chain
All players: OEM, Contract Manufacturers, surgeons,
All product types: Implants, Instruments, Biologics,
All manufacturing services: Forging, casting, machining, coating, packaging, …
Cross-checking
information Process
Implants
Hip
Knee
Spine
Extremities
Trauma
Contract
manufacturing
Implants Biologics
Worldwide coverage
Western
Europe
Latin America, Middle
east, Asia,..
+Developed
countries
BRICS
countries
Developing
countries
Instruments
Ali MADANIPhone: + 33 1 47 78 46 00
4
TUTORIAL
Orthopaedics Market
June 2015
Hip segmentation
Cemented Cementless Hybrid
Monobloc Modular ResurfacingShorter stem
& mini hipStandard
With bipolar shell
Total PartialRevision
Dual mobilitycup
Primary
Revision
HIP
Anterior approachsurgery
Postero/lateralapproach surgery
Executive summary
Ali MADANIPhone: + 33 1 47 78 46 00
5
TUTORIAL
Orthopaedics Market
June 2015
Be
arin
gs
Fixa
tio
ns
Total Hip
Cemented(Stem & cup
are cemented)
Cementless(Stem & cup
are cementless)
Hybrid(Stem is
cemented, cup is cementless)
Cemented
Metal / Polyethylene
Ceramic / Polyethylene
Cementless
Metal / Polyethylene
Ceramic / Polyethylene
Ceramic / Ceramic
Hybrid
Metal / Polyethylene
Ceramic / Polyethylene
Metal / Metal
Hip segmentation by fixations & bearings
Ceramic / Ceramic
Metal / Metal
Executive summary
Ali MADANIPhone: + 33 1 47 78 46 00
6
TUTORIAL
Orthopaedics Market
June 2015
Knee segmentation
KNEE
FIXED MOBILE UNICONDYLARFEMORO PATELAR
TOTAL Partial RevisionExecutive summary
Ali MADANIPhone: + 33 1 47 78 46 00
7
TUTORIAL
Orthopaedics Market
June 2015
Fixe
d V
s. M
ob
ile k
ne
e b
ear
ings
& F
ixat
ion
s
Po
ste
rio
r st
abili
zed
Vs.
Cru
ciat
eR
etai
nin
g To
tal k
ne
e
TOTAL
Posterior stabilized
Cruciateretaining
Knee segmentation: Fixed Vs. Mobile knee bearings, Fixations, Posterior stabilized
Vs. Cruciate Retaining Total knees
FIXED MOBILE
Cemented
Cementless
Hybrid
Cemented
Cementless
Hybrid
TOTAL
Executive summary
Ali MADANIPhone: + 33 1 47 78 46 00
8
TUTORIAL
Orthopaedics Market
June 2015
Shoulder segmentation
Shoulder
Total Partial Revision Resurfacing
Standard Reversed
Cemented Cemented
Cementless Cementless
Hybrid Hybrid
Mini shoulder
Universal stems
Executive summary
Ali MADANIPhone: + 33 1 47 78 46 00
9
TUTORIAL
Orthopaedics Market
June 2015
18%
5%
2%
17%23%
13%
22%
Worldwide orthopaedic markets in 2014:
~37.4 BUS$ (+4.4%)
Source: Avicenne research & analysis 2015
HIPKNEE
EXTREMITIES
SPINE
TRAUMA
ORTHO-BIOLOGICS
OTHERS
KNEE
8.5 B$+5.1%
Hip
6.4 B$+2.9%
SPINE
8 B$+2.5%
• Extremities: Shoulder, Elbow, Ankle, Foot, hand,… (excluding trauma)• Orthobiologics: Allograft, Xenograft, Synthetic Bone, Cement, BMP, others, Cell based Product, Auto repair product, Anti Adhesion product, Hyaluronic Acid,…
Ali MADANIPhone: + 33 1 47 78 46 00
10
TUTORIAL
Orthopaedics Market
June 2015
The Worldwide orthopaedics market: Growth
2000 - 2010 CAGR
Source: Avicenne research & analysis 2015
2010 - 2012 CAGR 2012 - 2014 CAGR
11,7%
2,3%
5,0%
2,3%
4,5%
0% 5% 10% 15%
EXTREMITIES
HIP
KNEE
SPINE
AVERAGE TotalOrtho
10,0%
1,8%
4,7%
2,0%
4,2%
0% 5% 10% 15%
EXTREMITIES
HIP
KNEE
SPINE
AVERAGE TotalOrtho
10,4%
13,3%
11,5%
11,4%
0% 5% 10% 15%
HIP
KNEE
SPINE
AVERAGE TotalOrtho
Ali MADANIPhone: + 33 1 47 78 46 00
11
TUTORIAL
Orthopaedics Market
June 2015
Worldwide implants market in 2014
in value (B$)
Market value (B$)
Source: Avicenne research & analysis 2015
8,5
6,4
8,0
3
4
5
6
7
8
9
Knee Hip Spine
57%19%
24%
Row USA
Europe
47%
24%
29%
Row USA
Europe
74%
11%15%
Row
USA
Europe
+5.1%
+2.9%
+2.5%
% Growth 2013-2014
Ali MADANIPhone: + 33 1 47 78 46 00
12
TUTORIAL
Orthopaedics Market
June 2015
Worldwide implants & Orthobiologics market
in 2014 in value (B$)
Market value (B$)
Source: Avicenne research & analysis 2015
6,95,0
1,80
2
4
6
8
Trauma & CMF Orthobiologics Extremities
48%
24%
28%
Row USA
Europe
70%
21%
9%Row USA
Europe
61%24%
15%
RowUSA
Europe
+5.3%
+5.6%
+11.3%
% Growth 2013-2014
• Extremities: Shoulder, Elbow, Ankle, Foot, hand,… (excluding trauma)• Allograft, Xenograft, Synthetic Bone, Cement, BMP, others, Cell based Product, Auto repair product, Anti Adhesion product, Hyaluronic Acid,…
Ali MADANIPhone: + 33 1 47 78 46 00
13
TUTORIAL
Orthopaedics Market
June 2015
European implants market in 2014
in value (M€)
Market value (M€)
Source: Avicenne research & analysis 2015
1 200 1 300
1500
200
400
600
800
1000
1200
1400
Hip Knee Shoulder
% Growth 2013-2014
11%
24%
17%13%9%
26% Germany
UKItaly
Spain
Others France
16%
22%
16%16%
5%
25% Germany
UK
Italy
Spain
Others France
+0.7%+2.5%
+6%
19%
24%
10%12%
6%
29%
Germany
UKItaly
Spain
Others France
Europe
Ali MADANIPhone: + 33 1 47 78 46 00
14
TUTORIAL
Orthopaedics Market
June 2015
The countries taken into account in Europe are
the 17 strongest economies
France65
Germany82
Italy61
UK64
Spain47
27 600
30 400
30 200
22 80020 200
Inhabitants in Million
GDP per capita in US $
Europe
Ali MADANIPhone: + 33 1 47 78 46 00
15
TUTORIAL
Orthopaedics Market
June 2015
The countries taken into account in Europe are
the 17 strongest economies
Belgium
11.1
29 600
5.6
37 300 Denmark
5.4
30 900Finland
9.5
Sweden35 300
4.6
Ireland36 400
Netherlands
16.7
32 700
8.4
Austria 32 2000,5
Luxembourg
Greece
11.1
62 600
14 900
Portugal
11.114 300
8
Switzerland44 600
5
Norway52 800
Inhabitants in Million
GDP per capita in US $
Europe
Ali MADANIPhone: + 33 1 47 78 46 00
16
TUTORIAL
Orthopaedics Market
June 2015
Worldwide orthopaedic market in 2014:
competition
2014 Worldwide Orthopaedic
Market
Source: Avicenne research & analysis 2015
2014 revenues of the Major
Orthopaedic Companies (B$)
Depuy-Synthes
21%
Zimmer11%
Stryker13%Medtronic
8%
Biomet6%
Smith & Nephew
6%
Others35%
2,0
2,4
4,1
3,1
4,9
7,9
0 10 20
Smith & Nephew
Biomet
Zimmer
Medtronic
Stryker
Depuy-Synthes
Orthopaedic products 2014
Other Medical devices 2014
Zimmer to acquire
Biomet for 13.4 B USD
2012: Depuyacquired Synthes
for 21.3 B USD
30,6%
33,3%
34,8%
25% 30% 35% 40%
2012
2013
2014
Other
Market share
Ali MADANIPhone: + 33 1 47 78 46 00
17
TUTORIAL
Orthopaedics Market
June 2015
The challengers gained market share continuously
Source: Avicenne research & analysis 2015
2012challengers
2013challengers
Hip
Knee
Spine
Trauma & CMF
Total
Ortho
15%
17%
26%
32%
31% 33%
15%
18%
29%
32%
2014challengers
35%
16%
21%
29%
33%
Ali MADANIPhone: + 33 1 47 78 46 00
0%
5%
10%
15%
20%
25%
30%
35%
40%
-10% -5% 0% 5% 10% 15% 20% 25%
WW
Ort
ho
20
14
mar
ket
shar
e(%
)
Revenues CAGR 2011-2014 (%)
Majors Vs Challengers: Majors saved their
ranking but Challengers got the growth!
18
Source: Avicenne , annual reports and companies June 2015
TUTORIAL
Orthopaedics Market
June 2015
Challengers
Legende
Market share
Revenues growth
1 BUS$
Ali MADANIPhone: + 33 1 47 78 46 00
19
TUTORIAL
Orthopaedics Market
June 2015
Challengers growing Vs majors
Source: Avicenne research & analysis 2015
Majors Challengers
Product standardization Multiplication of customized
Product range reduction Product range Extension
Sale channels cost cutting Attracting new sale forces
More centralized services Local and high level services
Ali MADANIPhone: + 33 1 47 78 46 00
20
TUTORIAL
Orthopaedics Market
June 2015
Market Drivers (1/6)
Source: Avicenne research & analysis 2014
Demographic& Economic
Impact 1: Population
Impact 2: Inhabitants 65+ years
Impact 3: Health expenses
Impact 4: Obesity
New products& innovationand revision
Impact 1: Product mix impact
Ali MADANIPhone: + 33 1 47 78 46 00
21
TUTORIAL
Orthopaedics Market
June 2015
Global population growth 1950-2050
and people over 65 (2/6)
Source: United Nations – World Population Prospects, The 2012 Revision, Smith & Nephew annual report 2014
0
2
4
6
8
10
12
1950 2000 2050
In b
illio
n
5%
51%
44%
2.5 billion people 6 billion people 10 billion people
0-19
20-64
65+
0-19
20-64
65+ 7%
54%
39%0-19
20-64
65+ 16%
56%
28%
Ali MADANIPhone: + 33 1 47 78 46 00
22
TUTORIAL
Orthopaedics Market
June 2015
The market drivers: Demographic & Economic (3/6)
Source : OCDE
Health expenses % of GDP
Obesity in developing countries % of inhabitants
Source : OCDE
USA
France
UK
0%
10%
20%
30%
40%
1980 1990 2000 2010 2020
USA
France
UK
0%
5%
10%
15%
20%
1965 1975 1985 1995 2005 2010
Ali MADANIPhone: + 33 1 47 78 46 00
23
TUTORIAL
Orthopaedics Market
June 2015 5%
7%
9%
11%
13%
15%
17%
19%
21%
23%
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
20
15
20
16
20
17
France Germany Italy Spain UK Europe
The market drivers: Product Mix impact (4/6)Example of Revision implants -> positive impact on Product Mix
Revision implants rate (% of the global market)
Source: Interviews & Avicenne Research & Analysis 2014
Positive impact on
product mix
Ali MADANIPhone: + 33 1 47 78 46 00
24
TUTORIAL
Orthopaedics Market
June 2015
The market drivers: Product Mix impact (5/6)
Average Hip Prices in Europe
Average sale prices in Euros
Source: Interviews & Avicenne Research & Analysis 2014
Hip implants:1 255 €
1 303 €
435 €
475 €
1 886 €
- 500 1 000 1 500 2 000
Modular & Anatomic
Monobloc
Partial implant*
Revision implant
Europe
Total hip:1 290 €
Ali MADANIPhone: + 33 1 47 78 46 00
25
TUTORIAL
Orthopaedics Market
June 2015
860 €
1 475 €
1 215 €
0 500 1000 1500 2000
Cemented
Cementless
Hybrid
765 €
1 045 €
1 260 €
1 425 €
1 845 €
1 817 €
1 000 €
1 175 €
1 580 €
1 520 €
0 500 1 000 1 500 2 000
Cemented M/PE
Cemented Ce/Pe
Cementless M/Pe
Cementless Ce/Pe
Cementless Ce/Ce
Cementless M/M
Hybrid M/Pe
Hybrid Ce/Pe
Hybrid Ce/Ce
Hybrid M/M
The market drivers: Product Mix impact (6/6)Modular Total hip: Cemented, Cementless & Hybrid
Average sale prices in Euros*
Source: Interviews & Avicenne Research & Analysis 2014
Europe
*in 2013
Innovation
Ali MADANIPhone: + 33 1 47 78 46 00
26
TUTORIAL
Orthopaedics Market
June 2015
The market limiters (1/6)
Source: Avicenne research & analysis 2014
ReimbursementImpact 1: Price decrease
Impact 2: Longer Time to market
Buying Groups
Impact 1: Price decrease
Impact 2: More Low-end products demand
CertificationImpact 1: Time to market
Impact 2: Higher development Cost
Ali MADANIPhone: + 33 1 47 78 46 00
27
TUTORIAL
Orthopaedics Market
June 2015
The market limiters (2/6)
Reimbursement and pricing regulation
USA Germany UK Sweden Italy Belgium Switzerland France
Launch date & extension
1983 2003-2010 2002-2007 1992-1994 1994-1998 1984 2002 2003-2012
Classification system
DRG
G-DRG (derivate
from Australian)
system
HRG (derivate from US system)
NordicDRG
ROD (derivate from US system)
APR-DRG (derivate from US system)
DRG (US system)
GHM (derivate from US system)
Targets
Coverage of all
Medicare budgets
75% of C-DRG in 2007
Target of 100% HRG
in 2006
Coexistence 50% DRG, 30% global
dotation& 20% de reimburse
ment
Coexistenceof 80%-
90% ROD, 6-7%
planifica-tion funds ,
& 3-14% extra funds
Main application: every day expenses
Invest-ments
supported by the
“cantons”
50% T2A in public
hospitals & 100% in
private and public in
2012
For more than 20 years, a general concern for controlling health expenses has started in the developing countries with the introduction of the DRG type systems
Ali MADANIPhone: + 33 1 47 78 46 00
28
TUTORIAL
Orthopaedics Market
June 20150,2%
0,6%
0,8%
-0,1%
0,5%
-0,8%
-1,1%
-2,1%
-1,8%
-1,1%
-1,1%
-1,1%
-1,5%
-3,0% -2,0% -1,0% 0,0% 1,0%
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
Price trends (3/6)
Average sales price trend
per year
Source: Interviews & Avicenne Research & Analysis 2014
Example of price decrease
for each product (Euros)Average forecasted price decrease/year
from 2013 to 2018: -1.3 %
691 €
938 €
1 695 €
310 €
688 €
0
500
1 000
1 500
2 000
2 500
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
20
15
20
16
20
17
20
18
M/PE cemented
Ce/PE cemented
Ce/Ce cementless
Partial standard
Partial with Bipolar shell
Europe
Ali MADANIPhone: + 33 1 47 78 46 00
29
TUTORIAL
Orthopaedics Market
June 2015
Price trends (4/6)
Average sales price trend
per year
Source: Interviews & Avicenne Research & Analysis 2014
Example of price decrease for
each product (in Euros)Average forecasted price decrease/year
from 2013 to 2018: -1.9 %
-3,7%
-1,5%
-1,5%
-2,0%
-1,8%
-1,9%
-2,6%
-3,2%
-2,2%
-1,8%
-1,8%
-1,9%
-2,0%
-4,0% -3,0% -2,0% -1,0% 0,0%
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
1 207 €
1 730 €
799 €615 €
2 276 €
0
500
1 000
1 500
2 000
2 500
3 000
3 500
200
6
200
7
200
8
200
9
201
0
201
1
201
2
201
3
201
4
201
5
201
6
201
7
201
8
Revision
Mobile bearing cementless Total knee
Partial Uni
Fixed bearing cemented Total knee
Partial Femoro Pat
Europe
Ali MADANIPhone: + 33 1 47 78 46 00
30
TUTORIAL
Orthopaedics Market
June 2015
The market limiters (5/6)
Regulatory, Certification,…
Re
gula
tory
REFERENTS DETAILS IMPACT ON THE MARKET
European
Directive
93/42
ISO 13 485
CE mark
Clinical tests
Sales autorization
Medical devicesvigilance system
Certification of « whole production line »
Additional costs
Longer time to market
Concentration of the product range
Limitation of new product launches
Longer time to market
Shared risks
Additional Insurancecosts
Change in contractmanufacturing practice
Ali MADANIPhone: + 33 1 47 78 46 00
31
TUTORIAL
Orthopaedics Market
June 2015
The market limiters (6/6)
Group purchasing developments in Germany drove the implant
prices down… It now serves as a model in lot of other European
countries
Source: Avicenne research & analysis 2014
Group purchasing was a success in
Germany…
For example the basic knee (fixed tibial plate - cemented) is priced at 1 350 €, for some tenders a Major proposed 900 € for this basic product.Another Major had in his customer portfolio the “Endoclinic and DAM Group” for 4 hospitals, with 10,000 knee and hip sales per year! Average price for the knee for this customer is much less than 1 000 €.
…it was much less successful in France and Italy
Some private hospital groups in France like “Vitalia or Générale de Santé” are trying to centralize their implant purchasing, but it is only the beginning. The discounted price was only a few % lower and those hospitals have to share these savings with the “French Caissed’Assurance Maladie”. The surgeon name reputation is considered as product marketing showcase of the private hospitals, which are making what is necessary to keep their surgeons. Hence they are not focusing on implants price reduction.In Italy, purchasing groups make less than 10% of the total orthopaedicmarket value per year and growing slowly.
Ali MADANIPhone: + 33 1 47 78 46 00
Innovative surgeons are looking for new products. They are lured
by new orthopaedic projects. Conservative surgeons mainly use
standard products with decades of clinical evidences
25%
40%
40%
40%
35%
20%
Latin countries Evidence basedcountries
Conservatives Followers Innovatives
% of the surgeons by category in each type of country
35
Sources: AVICENNE analysis
Conservativesurgeons
Innovativesurgeons
Followersurgeons
New products
Hip
StandardHips:
Charnley, Corail, Zweymuller
Standardknees:
Nexgen, LCS, TUTORIAL
Orthopaedics Market
June 2015
Ali MADANIPhone: + 33 1 47 78 46 00
36
TUTORIAL
Orthopaedics Market
June 2015
Hip implant trends 2006-2018 (in volume)
Total, Partial, Revision, Resurfacing & Mini hip
Total, Partial & Revision hip
Ratio (% of the global market)
Source: Interviews & Avicenne Research & Analysis 2014
Total, Partial
& Revision implantsIn Volume (x 1 000 implants)
65
7 73
9
146
163142
186
0
200
400
600
800
1000
1200
200
6
200
7
200
8
200
9
201
0
201
1
201
2
201
3
201
4
201
5
201
6
201
7
201
8
Revision
Partial
Total
66% 62% 57%
18%15%
15%
12%15%
17%
4%1%
1%
6%10%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%2
006
20
07
20
08
20
09
201
0
20
11
20
12
20
13
20
14
20
15
20
16
20
17
20
18
Mini hip
Resurfacing
Revision
Partial
Total
Europe
Ali MADANIPhone: + 33 1 47 78 46 00
37
TUTORIAL
Orthopaedics Market
June 2015
Total mini hip implant 2006-2018 (in volume)
57 000 mini hips in 2013
109 000 mini hips in 2018In volume (x 1 000 implants)
Source: Interviews & Avicenne Research & Analysis 2014
Mini hip ratio in 2018% of total hip in units
85%
15%59
1
62
0
57
109
0
100
200
300
400
500
600
700
8002
006
20
07
20
08
20
09
201
0
20
11
20
12
20
13
20
14
20
15
20
16
20
17
20
18
Mini hip
Totalstandarddesign
Total standard design
Mini hip
Europe
Ali MADANIPhone: + 33 1 47 78 46 00
38
TUTORIAL
Orthopaedics Market
June 2015
Total hip trends 2006-2018 (in volume)
Cemented, Cementless, Hybrid
Cemented, Cementless
& Hybrid ratio(% of Total hip)
Source: Interviews & Avicenne Research & Analysis 2014
Cemented, Cementless
& Hybrid Total hipsIn Volume (x 1 000 implants)
133 127 126
282389
439
108
131
163
0
100
200
300
400
500
600
700
800
200
6
200
7
200
8
200
9
201
0
201
1
201
2
201
3
201
4
201
5
201
6
201
7
201
8
Hybrid
Cementless
Cemented
20% 17%
60% 60%
20% 22%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%20
06
2007
2008
2009
2010
2011
201
2
2013
2014
2015
2016
2017
2018
Europe
Ali MADANIPhone: + 33 1 47 78 46 00
39
TUTORIAL
Orthopaedics Market
June 2015
Cementless trends 2006 – 2018 (in volume)
M/Pe, Ce/Pe, Ce/Ce, M/M
Source: Interviews & Avicenne Research & Analysis 2014
M/Pe, Ce/Pe, Ce/Ce & M/M ratio
(% of Cementless & Hybrid Total hip)
43% 40% 37%
29% 32% 35%
21% 26% 27%
7% 6% 2% 1%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
M/M
Ce/Ce
Ce/Pe
M/Pe
Ce/Pe is continuing slightly to grow
Europe
Ali MADANIPhone: + 33 1 47 78 46 00
40
TUTORIAL
Orthopaedics Market
June 2015
Bearing evolution in Total hip 2006-2018
% of Cementless & Hybrid Total hip
Source: Interviews & Avicenne Research & Analysis 2014
43% 40% 37%
29% 32% 35%
21% 26% 27%
7% 6% 2% 1%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
M/M
CE/CE
CE/PE
M/PE
Europe
Ali MADANIPhone: + 33 1 47 78 46 00
41
TUTORIAL
Orthopaedics Market
June 2015
Ceramic, Metal & PE trends for
Heads and Cups 2006-2018
% of Metal & Ceramic
HEAD
Source: Interviews & Avicenne Research & Analysis 2014
% of Metal, Ceramic
& PE CUP
80% 78% 77%
15% 21% 22%
5% 5% 2% 1%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
20
15
20
16
20
17
20
18
Metal
Ceramic
PE
45%53% 57%
55% 47% 43%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
20
15
20
16
20
17
20
18
Ceramic for heads is still growing in Europe
Europe
Ali MADANIPhone: + 33 1 47 78 46 00
42
TUTORIAL
Orthopaedics Market
June 2015
Knee implant trends 2006-2018 (in volume)
Total, Partial, Revision
Total, Partial & Revision Ratio(% of global knee market)
Source: Interviews & Avicenne Research & Analysis 2014
Total, Partial & revision implantsNumber of implants in volume(x 1 000 implants)
78% 77% 75%
11% 10% 9%
10% 13% 16%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%2
006
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
20
15
20
16
20
17
20
18
Revision
Partial
Total
573717
73
85101
152
0
200
400
600
800
1000
1200
200
6
200
7
200
8
200
9
201
0
201
1
201
2
201
3
201
4
201
5
201
6
201
7
201
8
Revision is the most growing
market
CAGR 2013-2018:Total: 4.6 %
Partial: 3.0 %Revision: 8.7 %
5.0 %Europe
Ali MADANIPhone: + 33 1 47 78 46 00
43
TUTORIAL
Orthopaedics Market
June 2015
Total knee trends 2006-2018 (in volume)
Fixed bearing Vs. Mobile bearing
Fixed VS Mobile bearing Ratio (% of Total knees)
Source: Interviews & Avicenne Research & Analysis 2014
Fixed & Mobile bearing implantsNumber of implants in Volume(x 1 000 implants)
382
548
191
168
0
100
200
300
400
500
600
700
800
200
6
200
7
200
8
200
9
201
0
201
1
201
2
201
3
201
4
201
5
201
6
201
7
201
8
61% 60%67%
77%
39% 40%33%
23%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%20
06
200
7
200
8
200
9
201
0
201
1
201
2
201
3
201
4
201
5
201
6
201
7
201
8
Mobilebearing
Fixedbearing
Mobile bearing rate is decreasing
CAGR 2013-2018:Fixed: 7.5 %
Mobile: -2.5 %
Europe
Ali MADANIPhone: + 33 1 47 78 46 00
44
TUTORIAL
Orthopaedics Market
June 2015
Fixed bearing knee trends 2006-2018
(in volume) Cemented, Cementless, Hybrid
Cemented, cementless &
hybrid ratio (% of fixed bearing
Total knees)
Source: Interviews & Avicenne Research & Analysis 2014
Cemented, cementless & hybrid fixed bearing kneesNumber of implants in Volume(x 1 000 implants)
218293
82
13482
122
0
100
200
300
400
500
600
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
20
15
20
16
20
17
20
18
66%57% 53%
15%21%
24%
19% 21% 22%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%2
006
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
20
15
20
16
20
17
201
8
Hybrid
Cementless
Cemented
Europe
Ali MADANIPhone: + 33 1 47 78 46 00
45
TUTORIAL
Orthopaedics Market
June 2015
Shoulder implant trends 2006-2018 (in volume)
Total, Partial, Revision, Resurfacing
Total, Partial, Revision,
Resurfacing shoulders Ratio(% of global shoulder market)
Source: Interviews & Avicenne Research & Analysis 2014
Total, Partial, Revision, ResurfacingNumber of implants In Volume(x 1 000 implants)
50
76
10
14
9
16
3
6
0
20
40
60
80
100
120
200
6
200
7
200
8
200
9
201
0
201
1
201
2
201
3
201
4
201
5
201
6
201
7
201
8
70% 70% 68%
20%14%
12%
10%12%
14%
4% 6%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%20
06
200
7
200
8
200
9
201
0
201
1
201
2
201
3
201
4
201
5
201
6
201
7
201
8
Resufacing
Revision
Partial
Total
Europe
Ali MADANIPhone: + 33 1 47 78 46 00
46
TUTORIAL
Orthopaedics Market
June 2015
Shoulder implant trends 2006-2018 (in volume)
Standard Vs. Reversed
Total modular Shoulder implants Standard Vs Reversed(% of global shoulder market)
Source: Interviews & Avicenne Research & Analysis 2014
Standard & Reversed Total modular shoulder implantNumber of implants In Volume(x 1 000 implants)
20 23
30
53
0
10
20
30
40
50
60
70
80
90
20
06
20
07
20
08
200
9
20
10
20
11
20
12
20
13
20
14
20
15
20
16
20
17
20
18
57%
40%30%
43%
60%
70%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%2
006
20
07
20
08
20
09
20
10
20
11
20
12
20
13
201
4
20
15
20
16
20
17
20
18
Reversed
Standard
Reversed shoulder is a growing market
Europe
Ali MADANIPhone: + 33 1 47 78 46 00
47
TUTORIAL
Orthopaedics Market
June 2015
Total reversed shoulder market 2006-2018
(in value): Cemented, Cementless, Hybrid
Total reversed shoulder
market
From 62 M€ in 2013 to 100 M€ in
2018
Source: Interviews & Avicenne Research & Analysis 2014
2013
2018
10%15%
75%
11%17%
72%
6 119
17
47
72
0
20
40
60
80
100
1202
006
20
07
20
08
20
09
20
10
20
11
20
12
20
13
201
4
20
15
20
16
20
17
20
18
Hybrid
Cementless
Cemented
Hybrid
Cementless
Hybrid
CementlessCemented
Cementless & Hybrid are growing markets
Cemented
Europe
Ali MADANIPhone: + 33 1 47 78 46 00
48
TUTORIAL
Orthopaedics Market
June 2015
The life cycle of the orthopaedic products:
Growth forecasts by 2020
Source: Avicenne research & analysis 2014
1980 1990 2000
Mar
ket
Time
HIP CAGR 14-20: +3.9%
Mar
ket
Time
KNEECAGR 14-20: +6%
Mar
ket
Time
SPINECAGR 14-20: +7.7%
Entrance date into the mass market
Mar
ket
Time
EXTREMITIESCAGR 14-20: +11%
Ali MADANIPhone: + 33 1 47 78 46 00
49
TUTORIAL
Orthopaedics Market
June 2015
Forecasts for the worldwide orthopaedics
market
Worldwide orthopaedic market: CAGR 2014/2020 +6,2 %
Source: Avicenne research & analysis 2015
0
10
20
30
40
50
60
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
20
15
20
16
20
17
20
18
20
19
20
20
CAGR 2014-2020:
HIP: +3.9 %
KNEE: +6 %
EXTREMITIES: +11 %
SPINE: +7.7 %
TRAUMA: +6 %
ORTHOBIO.: +7.2 %
CAGR : 9.3%
CAGR : 6.2%
10.7 B$
37.4 B$
53.7 B$
Ali MADANIPhone: + 33 1 47 78 46 00
50
TUTORIAL
Orthopaedics Market
June 2015
Summary
The orthopaedics market, including hip, knee, spine, trauma, extremities and Orthobiologics accounted for more than US$37B in 2014, with 4.4% growth.
The United States remains the largest market due to historical trends & higher sale prices. In Europe, Germany is by far the biggest market for all segments. Followed by the UK, France & Italy.
Even the 6 major companies, controlling 65% of the worldwide orthopaedics market, have continuously loose market share to the challengers. The challengers have gained 1 to 2% market share per year (US$350 to 700 additional revenue), achieving US$13B in revenue in 2014.
The only way for the Majors to have two-digit growth is by acquiring rivals (Depuy & Synthes, Zimmer & Biomet).
A huge gap remains between the size of the Majors and that of the Challengers. The revenues of the Majors are 10 to 50 times bigger of the Challengers. But the Challengers are growing more rapidly, on average by 15%, due to their wider range of products, their local, high level services. They are also attracting new sales forces.
The main drivers of the orthopaedics market remain demographic & economic parameters. Product innovation, resulting in a better (or higher) Product Mix, is boosting the market.
The reimbursement trend results in price pressure. This is the main limiter of the orthopaedic market. Price erosion of mature products in orthopaedics has been a constant over the past 20 years. We do not expect a major shift, but some countries will suffer a more significant price decrease than others.
Ali MADANIPhone: + 33 1 47 78 46 00
51
TUTORIAL
Orthopaedics Market
June 2015
Summary
Regulatory issues are becoming heavier and resulting in a longer time to market for new product launches, additional costs and a more limited range of products.
Competition is fierce. In each country, the local challengers have a robust market share: Aesculap & Link for example in Germany, Lima & Adler in Italy, Amplitude in France, etc.
Revision Implants are growing for all types of implants, cementless & Hybrid products continue to gain market share. Reversed Shoulder, mini hip, dual mobility cups, Trabecular for hips and cages are examples of growing segments.
In spite of regulatory issues & reimbursement trends, the orthopaedics market must continue to introduce innovations & new products and instruments to improve the new, less invasive and much more reliable surgical techniques.
In 2000, this market was worth US$10 B It grew to US$37B in 2014, and it will achieve US$54 B in 2020.
That represents an average of 6.2% growth in the coming years.