The market turmoil that started last week with the collapse of Lehman Brothers, the sale of Merrill Lynch and AIG's need for a cash infusion culminated with the government's $700 billion market bailout plan and the end of the traditional... more
A handful of big headlines rocked the financial sector this weekend, sending the S&P 500 down 3% at midday and compounding months of write-offs, bailouts and mergers that created a cloud of decline within the banking industry. To recap, Lehman... more
The Wall Street Journal this morning revealed a new variation on medical tourism: patients are traveling for medical procedures, though not overseas. Medical tourism arose from skyrocketing U.S. healthcare costs; a hip replacement can cost $43,000 domestically and a mere... more
Orthopedics Today is reporting that following the DOJ investigation, research institutions are seeing a slowdown in industry funding (with one unnamed Big-Five company withdrawing "nearly all" of its funding) that could decline even further in 2009. This reduction in funding... more
Following Zimmer's announcement that the company would suspend sales of the Durom acetabular cup, the New York Times suggested this morning that the concerns about Durom could've been identified sooner if the U.S. had a national joint registry in place.... more
A study published in the July 14, 2008 issue of Archives of Internal Medicine contends that hip and knee arthroplasty surgeries may be more beneficial to elderly patients than once believed. The study reports that surgery is not only more... more
Hospital for Special Surgery topped U.S. News and World Report's list of the best ortho hospitals in the country, boasting the most discharges of any orthopedic hospital, a large nursing staff and advanced technologies. A low mortality index (0.14), status... more
If you like to swim, hike or fish, summer is the season. And now the CDC has even more good news about these fun outdoor activities: you're probably not going to get hurt doing them. Summer sports are among the... more
China was a hot topic at the In3 Medical Device Summit, but one event focused on the device industry more broadly: where devices have been and where they're heading. The presentation, led by David Cassak of Windhover Information, described the... more
Last week's In3 Medical Device Industry Summit featured a talk on opportunities for device manufacturers in China, and we came away with a sense for the country's efforts to step up regulatory and legal practices to better reflect U.S. and... more
Anecdotal accounts of medical tourism often describe significant cost savings and suggest that the volume of patients who seek care overseas is climbing rapidly. Over the past few years, medical tourism has been depicted as a fast-growing trend to keep... more
Health Affairs recently reported on health spending projections through 2017, and the next decade is characterized by steady growth and a particular strength in public spending as baby boomers begin to enroll in Medicare. Health spending is reported to have... more
Medical devices rely on proper use to be "safe and effective," which is why FDA has in recent years encouraged devicemakers to incorporate human factors engineering into their development processes. What is human factors engineering (or HFE)? FDA defines the... more
At the confluence of war and improved medical care sit the 130 U.S. veterans of the current war in Iraq who have had an arm amputated. Advances in battlefield medical care have allowed soldiers who would have died in combat... more
Every so often we get the question at the trade shows - how do I buy all of the ortho stocks at once? In the past, our only answer was you had to buy representative shares of every ortho stock... more
The Patent Reform Act of 2007 has faced heavy opposition since its introduction in the House in April, notably from the MDMA and other industry groups. These organizations believe the proposed revisions to U.S. patent law would "undermine the value... more
At MDMA's annual meeting, CDRH's Director of the Office of Science and Engineering, Dr. Larry Kessler, discussed FDA's goals for unique device identification and a multi-phase plan for establishing and implementing a UDI system. The talk followed bipartisan support for... more
In what may be the first study to evaluate peer-review bias in orthopedics based on submitted, rather than published, studies, Joseph Lynch et al consider associations between scientific and nonscientific variables and outcome as well as acceptance for publication. Lynch... more
The National Institute of Standards and Technology announced an initiative last week to improve the precision and reliability of computer-assisted orthopedic surgery (CAOS) instruments in hip replacement surgery. NIST researchers have built a "phantom" hip that can be used by... more
Hailing hip replacement as one of the "great success stories of modern medicine," the New York Times published an article on Saturday emphasing the benefits of hip resurfacing as an interim step before traditional total hip replacement. There are a... more
Earnings BioMimetic Therapeutics announced 4Q:06 financial results, reporting a net loss of $5.3 million or $0.34 per share and beating analysts' estimates of a loss of $0.37 per share. This compares to a net loss of $9.2 million, or $5.82... more
Most scientists, says a recent article in the Cleveland Plain Dealer, don't know how to create a product or a business to produce it. Technology transfers can help, and one particularly active program is based in the Cleveland Clinic. To... more
Today's Wall Street Journal features an article on growth in the orthopedic market. Journalist Karen Richardson indicates that innovative, long-lasting and high-margin products are driving investment opportunities. An aging population and increased life expectancy bode well for manufacturers like Stryker... more
A team of European researchers has developed an innovative new method of drug delivery - the teeth. Intellidrug is a dental prosthesis fitted into two artificial molars, and it automatically releases a precise dosage of medicine on a continuous basis.... more
This week's New England Journal of Medicine features an editorial on pay per performance, wherein Arnold M. Epstein argues that P4P has reached a tipping point. Epstein describes the progressive changes as various organizations move toward P4P, at the same... more
Last week, Akron General Medical Center announced a technology transfer initiative designed to bring product development into the hospital - and, ideally, open the region to new medtech development and investment opportunities. The nonprofit hospital's new Technology Transfer, Commercialization and... more
A new bill was introduced in the New Jersey state legislature earlier this month that would allow patients to decide if they want to receive a reprocessed medical device. A similar bill was introduced in Massachusetts last year, but it... more
MIT's Technology Review reported recently on a new development out of Carnegie Mellon and the University of Pittsburgh: a custom ink-jet printer that can print tissue using stem cells from mice and growth factor. This is how the Carnegie Mellon/University... more
As reported in the Wall Street Journal this morning, costs relating to arthritis are growing - and this trend is expected to continue, spurned by an aging population and the obesity epidemic. In 2003, arthritis and related conditions cost the... more
An annoucement from a top orthopedics journal encourages the industry to consider how research is used by those who aren't physicians. JBJS announced on January 1st that they were initiating a new program of patient access to journal content: patients... more
Kyphon's pending acquisition of Israeli-based Disc-O-Tech's Assets for $240 million is only a part of the dollar volume of Israeli technology M&A activity in 2006. The Israeli Venture Capital Research Center reported that in 2006, 76 M&A technology deals involving... more
Controversial RFID (radio frequency identification) technology can be used to track everything from traffic patterns to pets, but it's healthcare applications that are drawing a lot of attention, particularly as companies try to develop safe, secure RFID tags for medical... more
The first arm of the Spine Patients Outcome Research Trial ("SPORT") study was released by the Journal of the American Medical Association yesterday. The $13.5 million NIH funded SPORT study has been designed to determine the efficacy of spine surgery... more
There is a pattern worth recognizing in the orthopedics industry - companies are taking drugs already on the market and exploring new indications, specifically for orthopedic related applications. From a safety perspective, this model makes a lot of sense -... more
Furthering the trend of the interoperability of medical devices (emphasized at last week's MDMA meeting) is a pilot program headed by Massachusetts General Hospital and the Center for Integration of Medicine and Innovative Technology. The program features the use of... more
This week we attended the Cleveland Clinic Medical Innovation Summit where industry luminaries gathered to discuss the future of medicine. The predominant themes were economics and advanced neurosciences. Notably, the ultimate form of evidence based medicine was highlighted: an elated... more
With limitations of time and money, designing a "perfect" medical device may be an unattainable goal. Practical limitations prompt designers stop at adequate designs lacking forseeable flaws - but new technology can give designers more freedom to test and develop... more
U.S. devicemakers face challenges in designing clinical trials, among them low recruitment rates and high costs. India may have the answer. Among the benefits, Pacific Bridge Medical reports in their November 2006 newsletter that cost savings can reach 40 to... more
The University of Alberta, Canada announced the development of a microsensor geared towards hip replacements that wirelessly monitors an implant's osseointegration. Built using nanotechnology, the device will be powered kinetically through the natural movement of the patient's body and remain... more
Today's New York Times reported that Stanford University has followed the University of Pennsylvania and Yale by putting in place a new policy that would prohibit its physicians from accepting small gifts (like pens and mugs) and free drug samples... more
Fact: GPO-negotiated contacts drive more than $100 billion in device purchases by hospitals. News Item: The DOJ, the Connecticut Attorney General, three U.S. Senators, and the New York Times call for GPO reform. Takeaway: GPO market reform will change your... more
Twenty-six publicly traded orthopedic companies that we tracked during the March 1, 2006 to June 30, 2006 quarter* posted an aggregate 10% growth (as reported) for both top and bottom line. These companies took in a total $6.5 billion in... more
Group Purchasing Organizations have historically been responsible for purchases surrounding low preference commodity products such as bed linens and gloves. Over time GPOs have been migrating to higher physician preference items. Today's announcement by US Spine that they have entered... more
Investments in health information technology (HIT) are slowly growing as hospitals, spurred on by the possibility of cost and quality of care benefits, increasingly incorporate HIT into daily use. HIT may very well come to play a large role in... more
Recently, the debate between Third-Party Reprocessors (TPRs) and Original Equipment Manufacturers (OEMs) has spread to the legislature of the state of Massachusetts. A proposed bill, Senate No. 2433, would require: -A patient to provide written consent prior to undergoing a... more
There has been a significant amount of discussion by Wall Street analysts regarding a slowdown in the total hip arthroplasty market. While we agree that there has been a slowdown, we believe it is more moderate than the rest of... more
Today, the National Center for Health Statistics issued a draft finding that the annual number of deaths in the U.S. dropped by nearly 50,000, or 2%, in 2004 which represents the biggest decline since World War II. The preliminary number... more
Our current forecast for the orthopedic industry projects continued long term growth of 15%. For 2006, we expect growth to be slightly below this trend, at 12%. Despite continued strength in other segments of the industry, hip and knee reconstruction... more
Doctors pushed back against marketing and commercial pressures from the pharmaceutical and medical device industries last week. On January 25, the American Medical Association (JAMA) published "Health Industry Practices That Create Conflicts of Interest: A Policy Proposal for Academic Medical... more
SpineMark is an operator of clinical and research-oriented spine centers, founded in 2004 as a joint venture between TBI Holdings (the management company of Texas Back Institute) and Management Technology Resources. The Company announced a closing of the first $10... more
The decline in the valuations of the orthopedic stock prices has reached epic proportions. The 7 leading orthopedic companies which derive a majority of their revenues from hip and knee sales are on average 30% off their 52-Week Highs. Biomet... more
There is no denying that healthcare costs continue to accelerate in the U.S. We would argue most of these costs are justified given the continuing technological advancements made within the entire healthcare arena including medical devices and biotechnology. However, we... more
More and more western patients seeking surgery are looking towards eastern destinations such as India, Thailand and Singapore for their medical needs, including orthopedic procedures. The healthcare sector in this region has become a flourishing industry. As patients from Europe,... more
[Editor's note: We welcome attorney Richard Zall of Mintz, Levin as a guest blogger to answer a question posed by a reader in response to Joane Goodroe's Gainsharing post earlier this week. See Zall's profile here.] Interested in your thoughts... more
There are numerous pathways to creating value in orthopedics. There are typically three classifications of companies within the orthopedic community: 1) technology companies 2) original Equipment Manufacturers (OEM) and 3) distribution companies. Technology Companies. A technology company is typically an... more
The lawyer's ads are all over the country and all over the two broadest media outlets we know - television and the internet. "Learn about Vioxx, the Vioxx recall and potential health risks!" "Are you a Vioxx Patient? Find out... more
Three of the seven leading large joint orthopedic manufacturers have reported their 3Q:04 financials. So far, market growth rates on a constant currency basis remain in-line with the growth rates reported by industry leaders DePuy, Biomet and Stryker in the... more
Capital markets aren't rational. Otherwise, they'd have longer memories. A year ago, when Zimmer was trading at $40.01, DJ Orthopedics was at $3.66, Encore was at $3.20 and LifeCell was at $2.89, you couldn't buy an orthopedic or medical device... more
For the past three weeks the HealthpointCapital research staff has been preparing a detailed outlook for the Orthopedic Industry with special emphasis on Large Joint Reconstruction, Spinal Implants, Sports Medicine (including bracing) and Biologics. The result is our outlook for... more
I may not be able to define it, but I know it when I see it. Seriously, NO trend in surgical medicine has been stronger than MIS. Twenty years ago balloon angioplasty – despite a nearly 80% failure rate –... more
Peter Drucker asked that question fifty years ago in his seminal book The Practice of Management. While his generic answer (“the only function of a business is to create customer value and to innovate.”) remains as valuable in 2004 as... more
Like much of orthopedics, Krispy Kreme sells a lifestyle product. And the basic emotion encompassed in that product is comfort. For eighty five cents, Krispy Kreme delivers a nearly perfect, melt in your month donut and, with that, a happy,... more
For the third quarter, with three more companies yet to report, public orthopedic companies have reported that their sales grew 17.5% on a year-over-year basis. To put that into perspective, U.S. GDP grew at a 7.2% annual rate in the... more
Orthopedics, the self-made industry, is troubled and struggling. At least that was the tone at last week's OrthoKnow Symposium (one of the best of such industry gatherings) as distributors and their fellow travelers gathered to discuss the state of orthopedics.... more
Dave Stassen, legendary medical device venture capitalist and principal at the $3 billion St. Paul Ventures in Minnesota is calling a turn in medical device venture investment. In his talk at the OrthoKnow symposium last week, Stassen recounted the recent... more
The data we see coming from the Centers for Medicare and Medicaid (CMS) tells us that the large joint reconstruction market is being driven by people born before 1944. Not Boomers. Not Zoomers – whatever they are – or any... more
We told you so. We said orthopedic industry revenues were accelerating. We just didn't predict that they'd be this strong. We were thinking 16%. Now that the last conference call of the second quarter is over, we've added up all... more
Despite being asked by the Merrill analyst to comment on the prospects for the Next Gen product (manufactured by Zimmer... oops, she meant Next Generation), Biomet's CEO, Dane Miller, was his usual wry self as he announced that overall sales... more
Everywhere we look we see victims. Shareholders want management's head on a platter. Management sincerely tried to do the right thing and - in terms of its effect on future operations - we think made the right decision. But, talk... more
Exhibit A: Stryker Exhibit B: Interpore Cross Not to pick on Merrill Lynch... but, and we quote, "Product mix benefit may slow a tad... we suspect this mix benefit has been largely realized." Cementless hip stems, metal on metal components... more
Earnings season starts this week with the Tuesday, April 15th release of DePuy/Acromed's first quarter results (as buried in JNJ's release) and continues until mid-May when Sofamor Danek's numbers for the April quarter (Medtronic, Sofamor Danek's parent, is on an... more
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