The Top Companies: A Collection of Thoughts

Each year, as we curate information for the top company reports, subjective opinions form, questions arise, and ideas emerge. However, these typically don’t make their way into the reports as we try to present a fact-based offering on the previous fiscal happenings. Fortunately, this space permits me to share a few items with you that I’ve jotted down as the reports are reviewed. As such, these thoughts are not presented in any particular order.

For years, I’ve been saying the orthopedic sector is going through a transformation. The truth of the matter is that change has already finished. That’s not to say progression of technologies, procedures, and trends won’t continue, but the shift in focus from the implant to the entire environment around the implant is in place. As a result, we continue to see the evolution of innovations around that implant, from new robotic solutions to digital verification of implant placement. 

Speaking of robotic-assisted surgical systems, will we see a departure from the large, capital equipment solutions that require more space in a hospital OR as more procedures move to the ASC? Since ASCs typically don’t have the room for such a system, the appeal of handheld robotic solutions is likely to grow. Might we see Mako or Rosa in a handheld format? Is Think Surgical an attractive acquisition target? The potential for significant change in this rapidly developing segment of the industry is incredibly interesting. 

Change is also taking place at the companies themselves. Medtech went through a period of massive mergers and acquisitions. While that’s still taking place, it doesn’t seem to be quite at the same pace or with the same flourish as it was previously. We saw the formation of industry giants that comprise the top company lists of today. 

However, what is happening—perhaps as a side effect of that time period—is a reconfiguring of focus. This has resulted in several companies divesting portions of their business via spinout or sale. While this trend is happening throughout medtech, in the orthopedic space, the victim seems to be spine. While the rate of growth for the segment is another consideration for the split, spine has already been spun out by Zimmer Biomet years ago and in this year’s report, by Stryker. And while Medtronic has set diabetes adrift, it’s long been rumored it may move on from its spinal assets. 

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Taking it a step further, the announcement by Johnson & Johnson MedTech that it would explore a divestiture of DePuy Synthes via spin-out or sale was even more surprising. The company has had a significant foothold in the sector via the division; this move will take the firm out of orthopedics altogether. 

These moves may result in a reshuffling of the top companies in the annual ODT list. The order of organizations has remained relatively unchanged for several years. However, Stryker recently announced it would be restructuring its business division. Once completed, the orthopedics unit will apparently include all relevant units and divisions. Currently, the orthopedic waters within Stryker are muddied and not all included in its Orthopedic reporting. Once the reordering is completed, the ODT Top Company report for the firm will focus exclusively on that division. As a result, with DePuy sailing solo, Stryker’s reorg, and Zimmer Biomet’s continued growth trajectory, it’s possible the top three spots are in a different position next year or in 2028. [For a deeper dive relevant to this portion, be sure to read this issue’s Orthopedic Insights. Dave and Flo do a fantastic job expanding on these ideas.]

While the digitalization of orthopedics will continue, another trend is happening in parallel. Alongside the data-driven innovations and robots, patients and doctors are seeking more natural solutions to orthopedic issues and even less invasive procedures. At this year’s ODT Forum in April, one speaker even predicted biologics would substantially alter the world of orthopedics. Eventually, he said (and sorry, I’m not confident I correctly remember who said it), orthopedics would be the industry where bone, muscle, and tissue are replaced with natural solutions while metal and plastic would be eliminated. Clearly, that’s still outside the immediate forecast, but one recent event could be viewed as a stepping stone years from now. 

At the front of news, you’ll find a 3D Systems story regarding the first point-of-care implant gaining regulatory clearance. While this situation involves additively manufactured cranial plates for soldiers, once machines are generating biologic-based printed offerings (e.g., natural bone), how far away will we be from those natural alternatives?

Review this year’s reports and see what predictions you have once you do.

Sean Fenske, Editor-in-Chief
[email protected]