The 10 largest orthopedic device companies in the world (MassDevice)
1. Stryker
2018 revenue: $13.6 billion
The world’s largest orthopedic medical device company is enjoying momentum at the start of the year. Stryker’s bottom line more than tripled to $3.6 billion in 2018, and sales were up 9.3% to $13.6 billion.Stryker (NYSE:SYK) officials see the company bolstering its position in the spine market as it integrates K2M, which the company acquired for about $1.4 billion in November 2018. Kalamazoo, Mich.–based Stryker also expects double-digit percentage growth in the number of Mako systems for robotically assisted knee and hip surgery implanted this year, said Katherine Owen, Stryker’s VP of strategy and investor relations, speaking during a January earnings call transcribed by Seeking Alpha.SVBLeerink analysts wrote during last month’s AAOS annual meeting that Mako remains best-in-class in an expanding category: “We continue to hear from docs that if one wants a true robotics platform, Mako is the way to go.”Stryker also used AAOS to introduce a redesigned ReUnion S humeral stem for shoulder arthroplasty, and Stryker’s trauma and extremities division launched Adapt for Gamma3 augmented reality software.
The company also continues to snap up new technologies, announcing last month that it was offering $220 million for OrthoSpace and its InSpace rotator cuff repair device.
2. J&J – Orthopedics
2018 revenue: $8.9 billion
Johnson & Johnson’s orthopedic device sales were down 1.9% to, to $8.9 billion in 2018, according to the company’s annual report. The shrinking business was partly due to J&J selling its Codman Neurosurgery business — maker of spinal cord and cranial repair products — for more than $1 billion to Integra LifeSciences in 2017. J&J (NYSE:JNJ) also saw a decline in sales of products for knee procedures, due to competitive pressures in the U.S.At the same time, New Brunswick, N.J.–based Johnson & Johnson has been introducing new products related to hips and spine. New spine products include the Concorde Lift expandable cage and the Viper Prime system for minimally invasive surgery.During a January earnings call, investor relations VP Chris DelOrefice also touted continued strong demand in the hip products sector for the primary stem Actis. Surgeons can implant the Actis total hip system through tissue-sparing approaches, such as the anterior approach, as well as traditional approaches, according to J&J and its DePuy Synthes Cos.
Johnson & Johnson is also developing robot-assisted orthopedic surgery platforms after acquiring French robot-assisted surgery company Orthotaxy in 2018. The Orthotaxy robot will be smaller and more affordable than surgical robots presently out there, Liam Rowley, VP of R&D for knees at DePuy, recently told Medical Design & Outsourcing.
3. Zimmer Biomet
2018 revenue: $7.9 billion
Zimmer Biomet (NYSE:ZBH) is in its second year of a two-year restructuring effort to boost competitiveness under CEO Bryan Hanson, a former Medtronic EVP who took the reins of the Warsaw, Ind.–based ortho device giant in late 2017. About 70% of Zimmer Biomet’s leadership team is new to the job, Hanson said during a February earnings call, transcribed by Seeking Alpha.Back orders are down, and the company is executing a remediation plan at its Warsaw North Campus as it continues to communicate with the FDA, Hanson said.Zimmer Biomet has also achieved some important clearances from the government watchdog. In October 2018, the agency granted 510(k) clearance for Persona revision knee implant, which has customized components to match each patient’s anatomy. Early this year, Zimmer Biomet won clearance for the Rosa Knee robot-assisted total knee replacement surgery platform, followed by clearance for the Rosa One robotic spine system.There is also Mymobility, Zimmer Biomet’s new patient care management app for the Apple Watch and iPhone.Zimmer Biomet lost $379.2 million off $7.93 billion in sales in 2018. The company also suffered a legal loss in late 2018 when a federal appeals court affirmed Stryker’s enhanced $248 million win against Zimmer Biomet in a surgical tool patent case.
“Overall, our financial results for the full year were in-line with our expectations for the progress of the turnaround of the business, and increase our confidence in achieving our 2019 objectives,” Hanson said in a news release at the time.
4. Smith & Nephew – Sports Medicine, Trauma and Reconstruction
2018 revenue: $3.6 billion
Smith & Nephew’s knee implants business grew 3%, to more than $1 billion, in 2018, and its hip implants business was up 2% to $613 million.Officials at Smith & Nephew (NYSE:SNN) are excited about the companies dual-mobility technology for hip implants, which they say protects against dislocation without compromising the range of motion of the device, CEO Namal Nawana said during a February earnings call transcribed by Seeking Alpha.London-based Smith & Nephew used the AAOS meeting in Las Vegas last month to introduce Navio 7.0, the latest software for its hand-held robotic surgical system. Expected to launch during the second half of 2019, the Navio 7.0 will include a new intuitive interface, expanded surgical preferences and streamlined workflow that may reduce surgery time. It’ll include hip software acquired through Smith & Nephew’s purchase of Brainlab’s orthopedic joint reconstruction business.
“We are a very relevant part of the overall robotic placements and units in the world today,” Nawana said of Navio.
5. Medtronic – Spine Division
2018 revenue: $2.7 billion
Medtronic (NYSE:MDT) in December 2018 closed on its $1.7 billion purchase of Mazor Robotics and its robot-assisted surgery platform for spine. A month later, it launched its Mazor X Stealth robotic-assisted spinal surgical platform in the U.S.Medtronic officials expect Mazor X Stealth to help grow the company’s neurosurgery business and create demand for spine implants, CEO Omar Ishrak said during a February earnings call transcribed by Seeking Alpha. “We’ve received early enthusiastic feedback for this combination of best-in-class robotics and navigation capability.”Ishrak mentioned strong capital equipment sales supporting Medtronic brain therapies growth. “As we execute more of these contracts, we would expect our core spine implant sales to grow over the coming quarters.”Fridley, Minn.–based Medtronic runs its Spine Division out of Memphis, Tenn.
6. Colfax Corp. – DJO Global
2017 revenue: $1.2 billion
Colfax Corp. (NYSE:CFX) in February closed on its $3.15 billion acquisition of DJO Global – the Dallas-based maker of knee, shoulder and hip implants, joint and spine bracing, and much more.“They are a clear leader with a strong history and an attractive potential for future growth and margin improvement,” CEO Matt Trerotola said in a news release.DJO used last month’s AAOS show in Las Vegas to introduce its Adaptable surgical arm, which it touted as the first fully sterile, surgeon-controlled leg and retractor holder designed for direct anterior approach total hip arthroplasty.
7. NuVasive
2018 revenue: $1.1 billion
NuVasive’s stock (NSDQ:NUVA) jumped about 17% in value, to around $58 per share, in early February after media reports that Smith & Nephew was reportedly in talks to acquire the maker of minimally invasive spine products. NuVasive’s stock price settled down a bit last month, though, after Smith & Nephew agreed to spend $660 million to acquire Osiris Therapeutics (NSDQ:OSIR).“NuVasive delivered strong year-over-year revenue growth of more than 7% in 2018, demonstrating the company’s ability to take share in a stable but relatively flat U.S. spine market,” CEO Chris Barry said in a February earnings press release.“Additionally, we made significant progress at our West Carrollton manufacturing facility, exiting the year at 70% SKU rationalization,” Barry said. “Collectively, these achievements serve to advance our mission to bring disruptive technology to surgeon partners to enable better, more predictable patient outcomes.”
8. Wright Medical
2018 revenue: $836 million
Wright Medical (NSDQ:WMGI) used the American Academy of Orthopaedic Surgeons (AAOS) show in Las Vegas last month to tout its Revive revision shoulder system. The Revive system includes specialized extraction instruments for implant removal and a unique humeral prosthesis for joint reconstruction. Amsterdam-based Wright plans a U.S. launch of Revive in first half of this year.
9. Orthofix Medical
2018 revenue: $453 million
Orthofix Medical stock (NSDQ:OFIX) fell by nearly a fifth in value in late February and early March after the Lewisville, Texas–based company failed to meet Wall Street analysts’ expectations for its fourth-quarter and 2018 sales.The company had some good news this week, however. An Investigational Device Exemption device study of its M6-C artificial cervical disc showed a significant improvement in neck and arm pain, function and quality of life scores. The FDA used the study results in making its decision to approve the M6-C, which has been available in the E.U. and other countries since 2006.
10. ConMed – Orthopedic Surgery
2018 revenue: $446 million
ConMed (NSDQ:CNMD) saw its domestic orthopedics revenue grow 4.5% in 2018, and international orthopedics revenue increased 3.5% year-over-year. Orthopedic products generating excitement at the Utica, N.Y.–based company include its MicroFree cordless small-bone power system, CEO Todd Garner said during a January earnings call transcribed by Seeking Alpha.The MicroFree cordless, battery-powered, pencil-grip instruments for small bone are meant to provide the freedom of cordless for ortho surgeons while still delivering the necessary power.