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By 2002,
people over 65 years of age will account for nearly 17% of the European
population, compared to 15.7% today. This is having a direct impact on
the number of gastroenterology procedures performed in Europe, and spells
good news for manufacturers of endoscopes. According to a new report from
DataMonitor, European Endoscopy, the increase in procedures—especially
in Italy and Spain—will offset consolidating markets and maintain
overall European growth.
In Italy—one of the key growth markets
for gastroenterology procedures—the market for endoscopes is set
to grow rapidly. The videoscope sector is currently valued at $12.8 million
(over 6 times the value of the fiberscopes market, worth $2.1 million)
and is expected to grow by almost 16% to reach $14.8 million in 2003.
Colonoscopes are the largest sector of the
Italian videoscopes market, with unit sales of 483 in 1998. They will
remain the largest sector in 2003, when 743 will be sold, although duodenoscopes
will achieve fastest growth, with unit sales rising from 82 to 151 between
1998 and 2003.
Traditionally, companies have used proceeds
from fiberscope sales to fund development of the videoscope and instrument
segments of their business. Datamonitor expects this trend to continue,
but notes that the switch from fiber to videoscopes is gaining momentum,
especially since videoscopes have been promoted by many European associations.
As a result, fiberscopes may eventually become obsolete, leaving videoscopes
to carry the market growth. As this happens, barriers to entry in the
marketplace will increase because of the high levels of optical and video
technology needed.
This trend can be seen in the UK, which is
typical of the overall European market. The UK market for videoscopes
will grow by almost 56% from its 1998 value to reach $15.5 million in
2003. This will comprise 45% of the overall gastroenterology market, up
from 39% in 1994. Over the same period, the share of instrumentation in
the overall market will probably fall from 46.7% to 43.4%, while that
of fiberscopes will fall from 14.1% to 11.8%.
According to Datamonitor, it is becoming increasingly
important for medical manufacturers to work closely with surgeons to understand
their needs. Changing requirements concerning endoscopes and instruments
are led by the public, which is demanding better comfort and less traumatic
diagnostic and therapeutic surgery.
Datamonitor's report also reveals a growing
need for more accurate product trials. Material quality is becoming more
important, and purchasers are asking for better evidence supporting usefulness
and success. Improvements in instruments, product miniaturization, increased
robotics, and better video displays are all seen as important by physicians.
Particularly attractive for surgeons are autoclavable products that can
sterilized quickly and cheaply; this has become more important as regulations
on sterilization and disease control have grown more strict. Physicians
also want manufacturers to list the recommended number of reuses allowed
for reusable instrument. Technical procedures using disposable instruments
can be quite costly, and physicians apparently believe that either companies
should reduce prices, or governments should be made more aware of the
costs involved in order to set regulations or increase reimbursements.
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The maxillofacial
trauma market is slowly moving toward resorbable technologies. A recent
report by DataMonitor, The American Maxillofacial Markets 1999,
examines the prospects for the US, Canadian, and Latin American markets.
Conversion to resorbables will be slow, the study finds, driving a growth
rate of about 10–15% annually for the new technology. Greater adoption
will probably come once competition starts driving prices down.
In 1998, the market value for US maxillofacial
trauma products reached $113 million in sales. Over the past five years,
the maxillofacial market experienced 6–7% annual growth. Volume sales
are relatively flat, so this increase must be attributed primarily to
increases in prices. The maxillofacial market is unlike other areas of
the orthopedics industry in that it is a niche market not subject to hospital
contracts (ie, price discounting). Datamonitor predicts that the dollar
value growth will level off from its 6.7% growth in 1998 to less than
5% growth in 2002. These growth rates will be driven by the double-digit
growth of resorbables, but may also be slightly offset by the smaller
increases in annual average selling prices.
Overall, the US market for maxillofacial implants
is relatively mature. As industry executives indicate, the primary use
for plates, screws, and specialty instrumentation is in trauma procedures.
There are virtually no new applications in that arena; thus the market
is witnessing little growth in volume sales and instead depending upon
5–6% annual increases in average selling prices to boost market value.
Datamonitor predicts that while resorbables will be the only fast-growing
market segment, titanium plates and screws will remain as the standard
fixation method thanks to a long history of proven clinical outcomes.
The Canadian maxillofacial market mirrors the
US market in many ways. In 1993, titanium plates and screws accounted
for almost 93% of the overall market. With the introduction of resorbable
plating systems, that percentage fell slightly to 89% in 1998. As in the
US, Canada's dollar sales rely very much on annual list-price increases.
Industry executives indicate average selling prices are relatively similar
to those in the US—unlike other areas of the orthopedics industry,
where Canadian prices are approximately one-half those in the US.
Additionally, US companies such as Synthes,
Leibinger, and Walter Lorenz Surgical dominate the market, leaving smaller
companies with only about a 5% market share. In 1993, the market value
for Canadian maxillofacial implants was US$4.2 million. As a niche market,
maxillofacial devices were not subject to many of the pricing pressures
experienced by other medical equipment industries. In fact, prices and
procedures increased 4–5% per year, thereby driving an 8–9%
dollar market growth. In 1998, the market reached US$6.6 million, and
Datamonitor predicts this will increase to approximately US$8.5 million
by year end 2002.
The countries comprising Latin America are
distinctly different, and assigning overall future projections can be
misleading. Nonetheless, taken as a single geographic region, Latin America
represented a maxillofacial market valued at US$15.9 million in 1998.
Of all orthopedic markets covered in the report, the Latin American market
segment is one of the most developed relative to the United States. At
approximately 15% of the US market value, this market segment has experienced
relatively high growth rates and is projected to continue at higher levels
over the next five years.
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According
to some estimates, direct and indirect costs for diagnosing, monitoring,
and treating diabetes hit $98 billion for 1997. Clearly, this field provides
numerous opportunities for manufacturers who can improve care, reduce
costs, and ultimately find a cure.
According to a new report from Medical Data
International, Disease Management Approaches to Diabetes in the
U.S., product developers, healthcare providers, and third-party
payers are exploring avenues to improve the monitoring and treatment of
diabetes.
Given the clinical benefits of more-frequent
glucose monitoring, a goal of many product developers is to minimize pain
associated with diabetic blood sampling and insulin injection. This goal
is being pursued by a vast array of companies that are developing puncture-free
devices ranging from laser-based blood sampling products and noninvasive
blood glucose monitors to pulmonary insulin delivery devices and various
types of implantable "artificial" pancreas.
Encouraged by healthcare providers, manufacturers
are seeking to provide the full range of products from screening to diagnosis
and treatment to gain market presence. Those manufacturers with products
limited to one area should form partnerships or distribution agreements,
the report concludes.
The report identifies 16 major competitors
in this market, namely, Abbott Laboratories, Amylin Pharmaceuticals, Bayer
Corp., Becton Dickinson, Bristol-Myers Squibb, Cygnus, Eli Lilly, LifeScan,
Medi-Ject, MiniMed, Mylan Laboratories, Novo Nordisk, Pfizer, Pharmacia
& Upjohn, Roche Diagnostics, and Warner-Lambert.
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Despite the
ongoing economic slump in Asia, the value of the Japanese orthopedics
market will continue to grow by 4% annually, reaching $1,132 million in
2002. Orthopedics Japan 1999, a recent study by Datamonitor,
finds that Japan, like other Asian counties, has been scaling back purchases
of medical device purchases; nonetheless, the relative maturity of the
orthopedics market and rapidly aging population will continued to drive
steady growth.
The squeeze on healthcare costs has forced
both local and foreign manufacturers to reduce their average selling prices
to gain volume sales. But despite price declines, these large increases
in volume sales are pushing up the overall market value. The best performing
segment will be hip implants, which is projected to grow by 40% from its
1998 value, potentially reaching $480 million by 2002. Sales of Japanese
knee implants totaled 31,750 units in 1998, up from 23,400 in 1993. Meanwhile,
the volume of hip implants sold rose from 43,000 in 1993 to 70,150 in
1998.
Datamonitor believes that revision arthroplasty
and less-invasive arthroscopy offer the greatest potential for growth.
The market for the former will be largely driven by procedures and pricing.
Specifically, an increasing number of revision hip and knee procedures
will be required to replace poorly implanted systems and failed polyethylene
components. The revision hip segment will account for a greater percentage
of the overall hip market, rising from 10% now to more than 11% by 2002.
In arthroscopy, the sale of bone anchors reached $3.4 million in 1998,
and Datamonitor estimates the market will grow at double-digit annual
rates to top $5.5 million by 2002.
Zimmer is still the market leader in Japan,
particularly in the cemented, cementless, and revision knee segments and
in the cementless and revision hip segments. The company claims a 30%
share of the total-cemented knee market, 29% of total-cemented implants,
and a 35% share of the revision knee market. In hips, Zimmer is able to
claim similar strength in cementless systems and revision hips, with shares
of 28% and 33%, respectively. Zimmer also fares well in the Japanese trauma
market, with 16% of the plates and screws market, 7% of intramedullary
nails, 25% of powered instruments, and 31% of bone anchors.
Still, Zimmer will face more intense competition
in all market segments, particularly from the newly merged companies of
Stryker/Howmedica/Osteonics and Johnson & Johnson/ DePuy. Stryker/Howmedica/Osteonics
now claims almost 28% of the total-cemented knee market (which accounts
for almost 50% of the overall $200 million knee market), putting it a
close second behind Zimmer. In the total-cemented hip market, the company
leads with 24%, surpassing both J&J/DePuy and Zimmer, each of which control
19% of the market.
Datamonitor believes that Stryker's strong
Japanese presence and distribution network, in combination with Howmedica's
long established product reputation, will boost the newly formed company's
market share even more. Furthermore, the company's integration strategy
of retaining both sales forces will strengthen surgeon relationships and
increase revenue potential.
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Back in 1994,
when pedicle screw litigation was making headlines, the spinal fixation
market suffered a decline of 6.3%. By the end of 1998, however, the market
had reached $477.7 million and was growing at an estimated annual rate
of 33.8%. All in all, the market enjoyed a cumulative growth of 155% between
1994 and 1998, thanks primarily to the resolution of many lawsuits and
the introduction of the spinal fusion cage.
A new report by Datamonitor, US Orthopedics
1999: Spine, finds four major trends affecting this market. First
is the "cannibalization" of the fusion cage market by bone dowel technologies,
and the second concerns the shift towards commercial bone graft substitutes,
such as DBM. The market is also seeing increased acceptance of electrical
stimulation, and heavy activity in mergers and acquisitions.
Three of these mergers in particular will
have deep repercussions. The first is the acquisition of Spine-Tech by
Sulzer Orthopedics. Sulzer, which did not previously have a large presence
in the spine market, will greatly benefit from this merger. Likewise,
Spine-Tech will have access to greater financial assets and distribution
channels. The second acquisition involves Medtronic and Sofamor Danek.
Medtronic is becoming a strong player in the neurostimulation market,
and both companies will benefit from this purchase, especially from an
R&D standpoint. Moreover, Sofamor Danek's bone dowel has been selling
rapidly. The third merger—or series of mergers—involves the acquisition
of Acromed by DePuy and the later acquisition of DePuy by Johnson & Johnson.
This conglomeration consolidates several spine product lines under one
company.
Datamonitor estimates that the rapidly growing
spine market will reach almost $1.2 billion by 2002, with annual growth
rates forecast to remain in the double-digit range. Rapid developments
in areas such as bone grafting will keep this market dynamic and profitable.
Within the spine market overall, Sofamor Danek commands the lead with
40%, thanks to its early introduction of several spinal fixation products;
however, heated competition from merged orthopedic companies such as J&J/DePuy/Acromed/Motech
could reduce this lead, especially since J&J is known for heavily discounting
its orthopedic products. As with other immature orthopedic markets, the
majority of spinal products have not yet been severely affected by cost
constraints. In fact, newer technologies are commanding a premium, and
the industry overall is witnessing rapid price increases. It's conceivable,
however, that bundling of orthopedic products could lead to an erosion
of prices. Moreover, M&A activity is not expected to abate, and the spinal
fusion cage market in particular can look forward to a jump in the number
of competitors.
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