Aging population, tech advances raise spirits in arthroscopy sector

by Karin Lillis

At 71, John actively enjoys his retirement. He spends time with family and indulges in his favorite hobby six days a week – fly-fishing. A worn-out rotator cuff pains him and makes it difficult to cast, so he schedules surgery to correct the damage. 

John represents a segment of Americans who live longer, more active lives – part of the target of a booming arthroscopy and soft tissue repair market. “Ten to 15 years ago, that wouldn’t have occurred,” says Eric Halvorson, director of marketing for Andover, MA-based Smith & Nephew Endoscopy. “Patients are much better educated about the options available to them. They’re realizing that they don’t have to live with injuries any more, and they can have them taken care of on an outpatient basis. Arthroscopy is probably the most well-penetrated of the minimally invasive procedures.”

Halvorson’s comments reflect significant movement in the U.S. arthroscopy market and soft tissue repair — estimated to be an $875 million opportunity, and buoyed by a 13.5 percent annual growth, according to Patrick Driscoll, president of MedMarket Diligence, a Foothill Ranch, CA-based firm providing tactical decision-making solutions for medical products and investment executives regarding new medical technology. Driscoll predicts that developments on several fronts could propel the arthroscopy market past the $2 billion mark by 2010.

“With a positive population growth rate over the next 10 years (0.8 percent) and a demographic shift, the potential patient population pool for arthroscopic and soft tissue repair procedures in the United States is growing,” Driscoll says. “Further, adults in the 18-59 year bracket incur the vast majority of soft tissue injuries. The baby boomers continue to age and are currently between the ages of 39 and 57. They will not go gently into the night, but instead will spend their active adult years incurring more and more sports related injuries.”

Each year, more than 1 million medically treated sports injuries are sustained by baby boomers alone, according to U.S. Consumer Product Safety Commission statistics. 

“The increasingly active lifestyle of the general population continues to contribute to the growth of the domestic sports medicine market. The growth of arthroscopic procedures in the U.S. parallels the growth of exercise and sports participation among the general population, resulting in an increase in common injuries such as fractures, torn ligaments, dislocations, sprains, tendon injuries, pulled muscles and ruptures,” Driscoll notes. 

Sensing opportunity, the physician community appears to have responded well to that demand. Training programs for surgeons – especially residency and fellowship programs – remain robust, according to Havlorson. “The various trade associations seem to have their satellite training programs quite full,” he says. “We were at a recent meeting for the Arthroscopy Association of North America, and the training sessions were jam-packed. Doctors want to understand what’s new and what’s happening out there.”

Radio waves

“Soft tissue repair products like reabsorbable implants and radio frequency energy devices that tend to be more procedure-specific in their application are currently fueling the segment’s growth,” Driscoll says. “These technologies are enjoying double-digit growth rates with reparative devices like reabsorbable implants growing at 12 percent annually and innovative energy-based systems like low level lasers and RF energy products enjoying 15 percent per annum growth.”

For instance, Smith & Nephew offers arthroscopic shavers that combine blades with radio frequency energy to create an instrument that can mechanically resect and coagulate tissue. “In the past, you could only resect and then you had to go back in with a separate instrument and coagulate the tissue,” Halvorson says.

Another large-growth sector is bioabsorbable materials, such as screws in the knee or anchors in the shoulder, he says. “Over time these products will be absorbed into the body. The patient isn’t stuck with a big chunk of metal in there once the tissue has healed. There haven’t been any clinical issues to suggest that it’s [harmful], but patients would rather not have something in their bodies they don’t need.”

Going digital

Mature technologies in the arthroscopic market have experienced a modest, but steady growth rate – about 2.5 percent annually, Driscoll says. This sector includes mature products that have been in use for the last 20 years such as scopes, cameras, fluid management systems and power instruments. 

“When you talk about surgery — especially arthroscopic or laparoscopic procedures — and the doctors need to see the interior of the abdomen or knee joint, they need to have a clear picture,” says Sean Howard, a Florida-based sales representative for Stryker Endoscopy, San Jose, CA. “Moving from analog to digital technology has been a huge advantage. We’re going to be coming out with high-definition monitors as well.”

For instance, a digital capture unit manufactured by Stryker allows a surgeon to take pictures of procedures then burn the image to a CD. “Instead of having files upon files of pictures, the surgeon can hold up to 100 cases on one CD-ROM,” Howard says. “They can also streamline video and burn it to a DVD.”

A wave of wireless technology – called Bluetooth — is also working its way into the operating suite, Howard reports. Bluetooth enables links between devices like mobile computers and portable handheld devices, as well as connectivity to the Internet. The technology is supported by application development in a wide range of market segments, including software developers, silicon vendors, peripheral and camera manufacturers, mobile PC manufacturers, handheld device developers and test and measurement equipment manufacturers.

In the arthroscopy suite, that can translate to equipment like wireless camera heads that allow surgeons greater flexibility in viewing and recording procedures, Howard says.

“Bluetooth is the hottest thing in [wireless] technology right now – not just in the operating room, but in other areas of business and the home as well,” Howard says.

While Stryker is working to incorporate Bluetooth technology into some of its equipment systems including camera heads, all of the company’s current camera equipment must be plugged into a camera box. “The new technology will allow us to use a wireless camera head that doesn’t have to be attached to the camera box,” Howard says.

Smith & Nephew’s Halvorson adds that the digital operating room is still in the early production phases, though it is steadily gaining ground. “It’s been ramping quite quickly over the last six to 12 months,” he says. “Coming in the future in the same area are wireless technologies. Surgeons can use Palm technology to capture information from their digital systems and download the information when they get back to the office and draw up their operating notes from cases they perform.”

Orthobiologics

Emerging technologies under a broad category called orthobiologics hold the future of the market – a segment that could potentially double the size of the soft tissue repair market within the next decade, according to Driscoll.

“There are today a number of approved orthobiologic technologies that serve the soft tissue repair market including viscosupplements, cellular transplantations and allogeneic tissue grafts,” he says.  

Collectively, these products account for about 20 percent of the revenues in the segment, and could grow at rates beyond 30 percent annually – powering the arthroscopy and soft tissue repair market above $2 billion by 2010, according to Driscoll.  

“Exciting research in the fields of human mesenchymal stem cell (hMSC) technologies, collagen-based scaffolding, polymer-based scaffolding, synthetic resurfacing materials and bone morphogenic proteins offer the promise to not just relieve pain or repair joint defects, but to genuinely heal damaged tissue,” Driscoll explains. “The patient no longer has to choose between simple pain relief and open reparative surgery. Technologies now exist to restore joint function.”

HPN

January