Arthroscopy market will boom for small joints
Sharyn Rosenbaum
Arthroscopy market will boom for small joints Arthroscopy equipment is one of the fastest growing segments of the orthopedic instrument market, and is expected to continue on a strong growth path because of new technology and surgical techniques.
For many orthopedic surgeons, arthroscopy is the surgical technique of choice because it provides minimal scarring and faster recovery time at a lower cost than traditional orthopedic surgery. With continuing technical advances in this area, arthroscopy is predicted to expand beyond large joints–knees and shoulders–into small joint applications for wrists, elbows and ankles.
Arthroscopy will be in high demand for diagnosing and treating temporomandibular joint disfunction syndrome (TMJ), carpal tunnel syndrome and spinal disc problems, according to industry sources.
The market for arthroscopic products is projected to reach $337 million in 1994, from $166 million in 1989, with most of the growth represented by increases in the number of units sold, according to Frost & Sullivan Inc., New York.
The market research firm estimates the overall orthopedic instruments and device market, which it defines as arthroscopic equipment, power instruments and bone growth stimulators, will reach more than $500 million in 1994, from $285 million in 1989. Large joint arthroscopy is forecast to experience slow growth and become a replacement market.
The leading suppliers of arthroscopic equipment in the United States are Smith & Nephews Dyonics Inc., a British-owned subsidiary in Andover, Mass.; Concept Inc., a subsidiary of Linvatec, based in Largo, Fla.; Stryker Endoscopy, San Jose, Calif., a division of Stryker Corp., Kalamazoo, Mich; Karl Storz Endoscopy-America Inc., Culver City, Calif., a subsidiary of Karl Storz GmbH & Co., based in Germany and Richard Wolf Medical Instruments Corp., Rosemont, Ill., a German-owned subsidiary of Richard Wolf GmbH.
Dyonics was the arthroscopy market leader in 1989 with 31.2% market share, followed by Concept (17.6%) and Stryker (15.6%), according to Frost & Sullivan.
About one million arthroscopic procedures are performed annually in the United States, according to Frost & Sullivan. Large joint arthroscopy, once only performed in the hospital, is now routinely done in outpatient clinics and surgical centers. Technology has improved significantly over the past ten years. And due to the new viewing systems and high resolution monitors used with the arthroscopes, the orthopedic surgeon’s visibility has been greatly improved, Frost & Sullivan reports.
Instruments used in conjunction with arthroscopes include probes, scissors, basket forceps, osteomes and others. Powered clamps forceps, knives, rongeurs, curetes, files, instruments, such as shavers and suction tubes, also are used. Lasers are the most recent surgical entry in arthroscopic procedures.
The disposable blade business, which accounted for about $37 million could be in trouble because of price pressures, according to Frost & Sullivan.
A complete arthroscopy system can cost more than $25,000, according to Frost & Sullivan. Arthroscopes cost an average between $2,000 and $3,000.
Dyonics deals with components
Dyonics, the market leader in arthroscopy, recently put two arthroscopes on the market, the Ectra video arthroscope for carpal tunnel syndrome, and the Discoendo scope for microdiscsectomy, which is a “hot area”, said Kathy Higgins, marketing communications manager. The Ectra was exhibited at the meeting of the Arthroscopy Assn. of North America. Dyonics also introduced a new video camera last fall, made by the company’s video division, which Dyonics acquired in 1989.
Its core business is arthroscopy components–video cameras, disposable blades, shavers, etc. “We had the first shaver in 1978 and have led the charge (in components) since then,” Higgins said.
The company’s direct sales force of 150 reps market its full line of arthroscopic equipment–arthroscopes, video cameras, shavers, disposable blades and products for TMJ–to hospitals, outpatient centers and surgical centers. It added 21 reps last year and plans to expand its sales force this year, Higgins said.
Dyonics sees the arthroscopy market growing, but not to the $337 million mark by 1994, predicted by Frost & Sullivan. And while it has products for small joint applications, large joints will remain a larger part of the company’s business, Higgins said.
About 30 shows a year are on its trade show schedule, including meetings of the American Academy of Orthopedic Surgeons and Arthroscopy Assn. of North America. Dyonics advertises in Orthopedic and Sports Medicine, Orthopedics Today, Orthopedic Nursing, American Journal of Knee Surgery, Orthopedics and Arthroscopy.
Concept markets implants
Concept, formerly a subsidiary of Zimmer Inc., Warsaw, Ind., a leading manufacturer of orthopedic devices, is now owned by Linvatech, another Bristol-Myers Squibb company. Along with arthroscopy equipment, it sells various types of orthopedic implants.
“We have implants, our competitors don’t,” said George Waters, product manager.
The advantage of having implants is that its gets the sales manager into the OR.”
Outpatient centers are the company’s primary market, Waters said. Concept has 60 to 65 direct sales reps in the United States as well as international reps. It plans to introduce new products within a year, Waters said.
Video products account for the company’s greatest dollar volume, with arthroscopes making up a small percentage of overall sales, according to Waters. Concept purchases its arthroscopes from other manufacturers. The orthopedic surgeon is the main decision maker in purchasing video equipment, but the general surgeon and in certain cases, an obstetrician/gynecologist, also have influence.
The majority of Concept’s arthroscopes are designed for large joints, but it carries arthroscopes that can be used for carpal tunnel syndrome and TMJ. The extent to which the company will focus on small joint applications for carpal tunnel and TMJ will depend on reimbursement by third party payers, Waters noted.
Waters agrees with Frost & Sullivan’s prediction of a $337 million arthroscopic equipment market by 1994. He estimated the sales volume of arthroscopes only at 8,000 to 10,000 units by 1995.
Concept’s assessments of tis competition over the years has changed. “Some of our used-to-be competitors, Wolf and Storz, are more into general endoscopy,” Waters said. “Its difficult for a sales force to cover both general endoscopy] and arthroscopy.”
The company exhibits at major orthopedic shows and meetings of sports medicine and arthroscopy associations. It advertises in orthopedic and nurse publications. Concept targets nurses with advertisements because they have some purchasing power for implants and hand instruments, Waters said.
Storz–endoscopy specialist
Storz’s California location imports endoscopic products from its German-owned parent, Karl Storz GmbH & Co., and its 41 sales reps market them to hospitals, outpatient centers, surgical centers and veterinarians, a new market for the company. Arthroscopy is now being performed on race horses, said John Dawoodjee director of training and technical services.
Storz which has offices in Canada, Mexico, England and France, specializes in examination scopes for endoscopy, hysteroscopy, laparoscopy, bronchoscopy, urology and endourology and manufactures light sources and examination lights.
Storz is developing new products, including a new shaver, an arthroscope sterilizer and an arthroscope for a slipped disc in the spine. The shaver is planned to hit the market in six months, Dawoodjee said. The company carries 11 scopes, ranging in size from 1.9 mm to 4 mm for small and large joints, with applications for TMJ and carpal tunnel syndrome.
Endoscopes are the company’s score business. Storz claims to be the only company to employ Rod-lens technology in making its arthroscopes. This technology provides better visibility than competitors arthroscopes, according to Dawoodjee.
Along with arthroscopes, Storz has a complete line of video cameras, printers, monitors and light sources.
Wolf to triple capacity
Richard Wolf Medical Instruments will triple its manufacturing capacity to produce new endoscopic products by moving into a new facility in Vernon Hills, Ill, said Paul Lopez, product manager.
It introduced its newest product, Panoview Three, an arthroscope with a fish-eye lens, at the meeting of the American Academy of Orthopedic Surgeons in March. The arthroscope will complement the company’s Panoview Plus wide-angle lens scope, Lopez said.
Wolf uses 40 independent reps to sell its endoscopes, hadn instruments and video products primarily to hospitals, but also to outpatient center and surgical centers.
Lopez sees the arthroscopic equipment market increasing with the development of new technologies and surgical procedures.
Wolf advertises its arthroscopy equipment in the major orthopedic and sports medicine journals.
Benefits of arthroscopy
Arthroscopy surgery can remove torn cartilage, tissue fragments or bone chips, repair torn ligaments and scrape away rough or soft cartilage. It also can diagnose and treat joint conditions.
Arthroscopes, which transmit an image of the joint to the eye, generally have a diameter of 4 to 5 millimeters, according to Frost & Sullivan.
Those designed for small joints (wrist, elbow, ankle, temporomandibular) have a diameter of about 1.7 millimeters.
For a knee procedure, an arthroscope is inserted into the capsule of the knee through a 0.25 inch incision. A high intensity light source using fiber optics attaches to the scope, allowing the surgeon to see the inside of the joint. Fiber optically lighted scopes also allow the image to be enlarged and viewed on a television monitor. Microsurgical instruments are then to cut, shave, drill or remove damaged tissue.
New arthroscopic instruments that may be developed over the next fice years will use the technologies or electrocauterizing, or lasers, according to Frost & Sullivan.
Developments in video and imaging could include super high resolution video, holography, interactive laser discs and computer-assisted image enhancement.
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