Skin replacements and substitutes in wound management

Skin replacements and substitutes (see image at right: Apligraf by Organogenesis, Inc.) compete in the severe burn, venous leg ulcer, and the diabetic foot ulcer markets where their high cost is offset by their ability to save lives and/or preserve limbs from amputation. These products have taken some time to demonstrate clinical effectiveness and to be approved for use to heal wounds more quickly than alternative treatments. In addition, these products are still significantly more expensive than alternative therapies, and publicly funded health care organizations around the world have sometimes found it difficult to absorb these costs despite strong cost-effectiveness claims. It is highly likely that products will take some time to reach high acceptance levels. The move towards cost effectiveness procurement practice is likely to increase uptake of these products as they move purchasers away from decisions based on unit product cost towards outcomes assessments and data. In addition, manufacturers are developing alternative manufacturing and lower-cost product designs that should enhance the cost-effectiveness of these products over the next few years.

The tissue engineering market has reached a point of growth inflexion, enforced by a downturn in biotechnology small-cap investment, and rationalization of tissue engineering programs by large cap medical devices and pharmacological organizations. This is strongly demonstrated by the wound management tissue-engineering field. Some companies like Novartis have recognized that existing product formats and cost structures are inappropriate for the wound management customers. As a result, the partnership between Novartis and Organogenesis dissolved at a point where sales seemed to be growing rapidly. Smith & Nephew took longer to receive approval for the Dermagraft product and limited their losses by divesting.

Globally, the market for tissue engineered skin repair and replacement is a $679 million market, with the majority of the market concentrated in the U.S. and Europe, but annual sales growth in Asia/Pacific and in RoW is in excess of 20% and 15%, respectively.

Tissue engineered skin, integumentary and plastic surgery products are detailed in MedMarket Diligence Report #S247, "Worldwide Wound Management" and Report #S520, "Tissue Engineering, Cell Therapy and Transplantation".

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