This week J&J held a third quarter earnings meeting and Medical Device & Diagnostics Business review in New York. We thought we’d share some highlights from the DePuy franchise for our orthopedic audience. Overall, DePuy saw operational growth (excluding the effect of currency) of 9% compared to the comparable quarter (US 5%, OUS 15%). Double digit operational growth was seen in the worldwide hip and sports medicine businesses, as well as the knee business outside the US.
Unlike its industry peers (this week Biomet reported 7% domestic growth in spine for the quarter, Stryker 31%) DePuy spine’s operational growth was down 1% in the US, up 8% overall. The company admitted to having had some challenges in the recent past in the spine division and saw a significant degree of turnover in their distributors. Nick Valeriani, Worldwide Chairman, Medical Devices and Diagnostics, attributed current optimistic feelings about the spine business to a stabilization of the distribution network in the US, the Expedium product line and MIS program.
The knee franchise saw total operational growth of 9%, and one of the new product launches highlighted by Mr. Valeriani during the MD&D discussion was a new high-performance SIGMA knee platform. This product line will be based on a “patient segmentation strategy” which further highlights the customization trend we are currently seeing the field of orthopedics with gender specific devices.
Also of interest are some of the device and diagnostics areas that the MD&D group considers part of their growth strategy. The Company sees opportunities entering/creating new markets in sedation, aesthetic medicine, microelectronics and natural orifice. They also plan on exploring white spaces such as cell therapy, health management, respiratory, pain, infection control and CHF/complex arrhythmias. One of the novel products being pursued by the group is a contact lense the can deliver active ingredients (such as allergy medication), a market the Company estimates at $500 million.
