Reading into Orthopedic M&A

For a number of years now, we’ve heard about the much anticipated return of M&A in medtech (at least, its return closer to levels than we’ve seen in the past). While it’s never gone away, the deal values have been diminished in recent years and we’ve lacked the blockbuster acquisitions we saw during the previous decade. There are many reasons that could be the cause for this trend, from greater FTC oversight, to the long runway to see a return on investment, to the desire of acquiring companies to see a more proven technology before they seek to buy. Regardless of the reason, if the last month was any indication, 2025 will finally deliver on those anticipated promises.

According to a J.P. Morgan report published in January, there were 305 acquisitions announced in 2024 (through Dec. 9, 2024), totaling $63.1 billion with a rise in smaller deals. This was up substantially from 134 in 2023. However, the median upfront payments dropped to $121 million, compared to $189 million in 2023. Of course, just a few blockbuster deals can affect that number. In 2024, the big buy for the year was J&J’s acquisition of Shockwave for $13.1 billion. 

One month into 2025 and we’ve already seen a billion-dollar deal within orthopedics with the announcement of Zimmer Biomet’s purchase of Paragon 28. A foot and ankle portfolio will be added to the company that arguably leads the pack in intelligent orthopedic solutions. How it will ultimately impact ZB’s offerings remains to be seen, as the firm already maintains a bevy of foot and ankle products for the market. However, Ivan Tornos, president and CEO of Zimmer Biomet, stated, “This proposed transaction further diversifies Zimmer Biomet’s portfolio outside of core orthopedics and positions us well in one of the highest growth specialized segments in musculoskeletal care, while creating cross-selling opportunities in the rapidly growing ASC space.”

Perhaps more interesting than this proposed deal and/or the return of robust M&A activity in the medtech industry was the announcement that Stryker was leaving spine. Spine was considered a strong growth market for implant and device makers in recent years. Has that analysis already changed? Is the spine industry maturing such that device manufacturers are more interested in other clinical areas? Or, is this a matter of Stryker maintaining interest in other areas of healthcare that may not even be within the orthopedic sector?

The spine division sale to the Viscogliosi Brothers, a family-owned investment firm that specializes in the neuro-musculoskeletal space, wasn’t the organization’s only announcement in January 2025. Earlier in the month, it announced it was acquiring Inari Medical Inc. for almost $5 billion. Inari develops and manufactures products to treat venous thromboembolism.

“The acquisition of Inari expands Stryker’s portfolio to provide life-saving solutions to patients who suffer from peripheral vascular diseases,” said Kevin Lobo, Stryker’s chair and CEO. “These innovations elevate the standard of care for venous thromboembolism patients and will accelerate Stryker’s impact in endovascular procedures.”

This move follows on the heels of several non-orthopedic sector purchases in 2024, including Stryker’s acquisition of Nico Corporation (minimally invasive surgery for tumor and intracerebral hemorrhage procedures) and care.ai (artificial intelligence-assisted virtual care workflows, smart room technology, and ambient intelligence solutions). That’s not to mention the 2022 purchase of Vocera Communications, which offers a digital care coordination and communication platform. 

Do these moves by Stryker reflect an interest in reshaping its image and product offering? It’s unlikely the firm would drop all of its interest in orthopedics, but these moves certainly point to a company that’s altering its focus from specific clinical application areas to more of a robust offering to hospitals, ASCs, and other care centers. If the industry truly embraces a value-based healthcare reimbursement model, companies that resemble that profile will certainly gain a greater piece of the monetary pie than those that still rely on more transaction-based models. 

Perhaps the interesting aspect of M&A in medtech isn’t deal size or volume. Rather, the deals themselves may reveal much more about a company’s strategy going forward. A company that’s quite active in M&A may be looking to expand on core competencies, or they may be entering a new care market with the purchase of new technologies. Similarly, what a firm divests could further reveal its intentions and interests. 

What deals do you anticipate within the orthopedic industry? Over the years, I’ve heard a number of predictions, from the purchase of Smith+Nephew to the divestiture of Medtronic’s spine division. Will one of these come to fruition in 2025 or have these rumors subsided? Regardless of what takes place, I’d love to get your thoughts on this topic and hear your predictions.

Sean Fenske, Editor-in-Chief
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