30 Orthopaedic Product News • November/December 2005

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In keeping with the focus of this issue of Orthopaedic Product News,we’ll take a quick look at the power instrument market and then move onto the increasingly-crowded and competitive market for upper extremityproducts.

From pin drivers in external fixation to oscillating saws in jointreplacement, power equipment represents a wide array of electric,pneumatic and battery-operated tools used in more than six millionorthopaedic and craniomaxillofacial procedures in the U.S. StrykerInstruments leads the market, with more than $300 million in sales,nearly twice what its nearest competitor generated in 2004. Not only isthe size of Stryker’s power instrument business impressive, but so too isits continued double-digit growth, which far outpaces that for many othersmaller companies selling power equipment.

Despite the dominance of one company in the market, Aesculap,Anspach, Brasseler, ConMed, Gateway, MicroAire, Medtronic MidasRex, Osteomed and Sodem each takes on Stryker in particular areas (e.g.Anspach and Osteomed in high speed; ConMed and MicroAire in largeand small bone). Watch for niche plays in power from companies likeIMT, with its powered broaching system (a first for the U.S. market) andBioAccess and Orrex, both of which have commercialized disposablepower tools.

While I may not be very adept with power tools, my upper extremi-ties serve me well in other areas. I can heft a bail of hay with the best ofthem and my freestyle ain’t bad either. I’m hoping to one day swim withmy mom in the Senior Olympics, provided my arms and hands don’t fallvictim to the more than 34 million upper extremity disorders that occureach year in the U.S.

In 2003, patient visits for upper extremity disorders resulted in nearlyfour million procedures in the U.S. Exhibit 1 provides a breakdown oforthopaedic diagnoses and procedures related to the musculoskeletalanatomy of the upper extremity.

Exhibit 1Orthopaedic Diagnoses and Procedures of the Upper Extremities - U.S.2003

Disorder/Condition VolumeAcquired deformities 284,400 Dislocations 1,379,189 Fractures 12,769,453 Enthesopathy 11,425,602 Sprains 8,053,111 Osteoarthritis 527,340 Total Diagnoses 34,439,096

Procedure VolumeJoint replacement 105,729 Open reduction, fracture* 191,688 Closed/percutaneous reduction, fracture* 2,006,276 Internal fixation, fracture, w/o reduction 10,550 Open ligament repair/reconstruction 397,873 Arthroscopy 686,764 Osteotomy/treatment of malunion 18,259 Fusion 42,936 Other repair** 217,099 Total Procedures 3,677,175

*With or without fixation**Repair of recurrent dislocation of shoulder; other repairs of shoulder, elbow,hand, fingers and wristExcludes >300,000 operations on muscle, tendon and fascia of hand(The Ortho FactBook™: U.S. 5th Edition; Solucient, LLC and Verispan, LLC)

As noted in Exhibit 1, the U.S. does not suffer a dearth of upperextremity problems and solutions. However, upper extremity productsoften take a back seat to larger, more profitable endeavors, particularly injoint replacement. Nonetheless, a substantial market exists for treatmentof upper extremity disorders.

With more than 20,000 total and partial shoulder replacementperformed each year in the U.S., the market for shoulder replacementrepresents more than $150 million in annual revenues. DePuy claims the#1 spot in the market through its Global Shoulder franchise. However,Biomet and Zimmer are nipping at its heels, with Tornier not far behind.Arthrex, Encore, Exactech and Smith & Nephew also market total and/orpartial shoulder products, although only DePuy, Encore and Tornier offerreverse shoulder prostheses for treatment of irreparable, severely torn ordeficient rotator cuffs. Of note, Tornier remains the only ex-U.S.company with a solid footing in U.S. joint replacement (in shoulders), afeat it may leverage into elbows, as well.

Speaking of elbows, fewer than 5,000 elbow arthroplasty procedures(including radial head replacement) take place each year in the U.S.Despite a small base of procedures, companies are clamoring to bring tomarket total and partial elbow products. Acumed, Ascension, Biomet,BioPRO, DePuy, Hand Innovations, Kapp Surgical, Kinetikos Medical(KMI), Small Bone Innovations (SBI), Smith & Nephew, Stryker, WrightMedical and Zimmer all market radial head implants or total elbowreplacements. Stuckenbrock received clearance for an ulnar headimplant, while Aptis Medical remains the only company with FDAclearance to market a distal radioulnar joint prosthesis.

Stryker Rules the Power Market;Smaller, Niche Players PositionThemselves to Address UpperExtremities

Author: Shirley A. Engelhardt

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Moving down the arm to the wrist and carpals we find DePuy leading thesmall wrist replacement market with its Biax Total Wrist althoughBiomet, KMI and SBI also sell wrist implants. In finger replacement,which finds application in more than 70,000 metacarpal (MCP),interphalangeal (IP), carpocarpal and carpometacarpal (CMC) arthro-plasties annually in the U.S., Ascension’s pyrocarbon and DePuy’s anasilsilicone have begun to take on Wright Medical, which has historicallydominated the digit replacement market with its elastomeric andelastomeric/metal implants. SBI competes, as well, although sales of itscobalt chrome/polyethylene proximal IP and MCP devices are limited bythe products’ clearance under Humanitarian Device Exemptions.

While more than 12 million upper extremity fractures occur each yearin the U.S., some 20 percent present in a younger patient populationoften treated conservatively without surgical intervention. For thosefractures requiring surgery, treatment can range from compressionscrews and traditional plate and screw systems to newer lockingcompression plates, anatomically-contoured plates, periarticular platesand intramedullary nails (IMs) for humeral and forearm applications.The market has also witnessed a recent spate of minimally invasiveradius plating and nailing systems, exemplified by Hand Innovations’distal radius plate, the first that allowed the surgeon to address thefracture from the volar side. Having built its $35+ million businesslargely from the success of this plate, Hand Innovations now facessubstantial competition from most major trauma companies (and severalsmaller ones), all of whom have brought out similarly-conceived distalradius repair products.

Other novel products for upper extremity repair include Wright’s newMicronail, an IM nail for radius fracture repair (see Exhibit 2.); Hub Capand Spider wrist fusion plates from Acumed and KMI; a clear wristfixator from Rigid Medical; the TenoFix Tendon Repair System forrepair of severed or lacerated digital flexor tendons from Ortheon (seeExhibit 3.); and the Artelon CMC spacer from SBI. SBI licensed theArtelon product (resorbable degradablepolyurethane-urea patented biomaterial) fromArtimplant and the companies recentlyexpanded their relationship to include use ofthe Artelon technology in development ofspacers for the scaphotrapezotrapezoidaljoint, thumb base joint and distal radio-ulnarjoint. CMC implants can also be had throughAscension, BioPRO and Wright Medical.

Soft tissue repair in the upper extremity largelycenters on the shoulder, where rotator cuff andBankart repair procedures number in excess of400,000 in the U.S. annually. Each of the keyarthroscopy/sports medicine companies (Arthrex,ArthroCare, ConMed, Mitek, Smith & Nephew,Stryker) offers a line of resorbable and non-resorbable fixationproducts and handheldinstruments specifi-cally to address theseshoulder injuries.

Mitek created themarket for sutureanchors with its 1989introduction of thefirst suture anchor forshoulder applicationsto the U.S. market.

The most recent FDA clearances for suture anchors came to AxyaMedical and Inion. Inion’s Anchron suture anchor complements thecompany’s line of upper extremity products, which includes resorbableplates and pins, all manufactured from the company’s proprietaryresorbable Optima polymer. (Stryker distributes Inion’s fracture repairproducts.) Axya’s anchor complements the company’s core technology,the AxyaLoop, a suture loop secured with ultrasonic energy, thusobviating the need for knot tying. Bonutti also offers an ultrasonictechnology for soft tissue repair, while MedicineLodge, Opus (nowArthroCare) and, most recently, KFx Medical have all developedknotless fixation technologies.

Although bone graftand allograft fixationproducts certainly have aplace in upper extremityfracture repair, biologicsfind their largest applica-tion in the repair andreinforcement of rotatorcuff tears. Technologies inthis arena include WrightMedical’s GraftJacketacellular tissue matrix(through LifeCell; seeExhibit 4.); Arthrotek’sCuffPatch resorbablecollagen-based material(through Organogenesis);DePuy’s Restore (the firston the market), a porcinesmall intestine submucosa-derived implant developedin conjunction with PurdueUniversity; Stryker’s Tissue-Mend remodelable collagenscaffold (through TEI); andZimmer’s Collagen RepairPatch, a chemically cross-linked, acellular sheet ofcollagen/elastin processedfrom porcine dermis (fromTSL; see Exhibit 5.). Mostrecently, Kensey Nash received expanded FDA clearance to market itsBioBlanket Surgical Mesh (resorbable collagen sheet technology) specif-ically for the reinforcement of soft tissue in rotator cuff repairprocedures.

With 44% of orthopaedic surgeons focusing their practices primarilyon shoulder/elbow and an additional 28 percent claiming hand as theirprimary focus (Orthopaedic Practice in the U.S. 2004/2005, theAmerican Academy of Orthopaedic Surgeons), you can see whycompanies are paying attention to these sectors of the market. Althoughlong the red haired step child within the ranks of many an orthopaediccompany, products to treat upper extremity disorders have been re-invented and re-invigorated in the focus and passion of several newentrepreneurial companies.

The author owns stock in all publicly traded orthopaedic companies aswell as Ascension Orthopedics.

Shirley A. Engelhardt is President and Founder of KnowledgeEnterprises, Inc. (www.theorthopeople.com) She can be reached at 440-247-9051 or shirley@orthoworld.com.

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Enquiry No 42

Exhibit 4:Wright’s Graftjacket®

Exhibit 2:Wright’s

Micronail

Exhibit 3: Ortheon’s TenoFix

Exhibit 5:Zimmer’sCollagen

RepairPatch

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