Analyzing data from Report #S254 ,”Wound Management to 2026″, we present the distribution of top competitors’ sales in each segment in 2017. Smith & Nephew, Johnson & Johnson, and 3M dominate the global wound management, with varying dominance between them — or by other companies — in each segment.
Source: MedMarket Diligence, LLC; Report #s254. (Publishing March 2018)
S&N leads the global market, following closely by JNJ. Both companies are active in multiple segments of wound management. S&N has lower traditional wound management product sales (simple dressings and bandages) and higher sales of “advanced” wound management products. J&J does $800 million more sales in traditional dressings, gauze and bandages than S&N, but lesser involvement in newer wound technologies such as NPWT, bioengineered skin, and growth factors.
Source: MedMarket Diligence, LLC; Report #s254. (Publishing March 2018)
The distribution of sales of different wound management products naturally varies from one country to the next based on pricing, reimbursement, local clinical practice trends, cultural characteristics, and any number of other drivers. The net effect is different distributions.
The goal for wound market players in gauging opportunities is knowing where things are going.
In the global aggregate, here is how we anticipate the market for wound management products in 2016 will stack up compared to 2026:
As you can see, traditional wound management products are giving way in the balance to advanced products. How this global dynamic plays out differently in local markets is important for manufacturers to consider, as shown in the comparison of wound markets in China, the USA and Japan, both in 2017 and 2026.
You can see (in graph, above) the difference in relative sizes of the USA, Japan and China wound markets, in both 2017 and 2026. The largest relative increase in the absolute market will occur in China as a result of its double-digit growth rate. By comparison, the USA market overall is growing slightly faster than Japan (5.8% versus 4.2%, CAGR 2017-26).
More remarkable is the difference in distribution of products sold in these three countries. With the exception of a consistent general decline in relative sales of traditional products, each of these countries is exhibiting different rates of change in the distribution of wound product sales from 2017 to 2026.
March 2018 “Worldwide Wound Management, Forecast to 2026: Established and Emerging Products, Technologies and Markets in the Americas, Europe, Asia/Pacific and Rest of World.” Report #S254.
Traditional wound care products (gauze, non-adherents, and adhesive dressings) encompass low innovation, commodity-like pricing and ultimately different sets of competitors than advanced wound care products.
Below illustrates the global market shares of wound care sales in traditional versus advanced products. JNJ and S&N have swapped positions in the traditional versus advanced wound markets.
Among wound care’s most fragmented markets in terms of competitive activity are hydrocolloids and foam dressings, with no one competitor dominating the market. While 3M and S&N control significant shares of the hydrocolloid and foam dressings market, their aggregate share is still well under 50%.
Global Wound Management Market Shares in Hydrocolloids and Foam Dressings, 2017
By comparison, other markets have clearly dominant players, such as in negative pressure wound therapy (NPWT) and growth factors used in wound care. In each, there is clearly one dominant player and the top two players control a large majority of each market.
Global Wound Management Market Shares in NPWT and Growth Factors, 2017
Generally, the longer the product has been around (e.g., gauze), the less complex it is compared to emerging technologies…
…BUT simpler is easy to adopt and, with well established sales, growth on a percentage basis will be low (see area in red).
Generally, new technologies incorporate rarer materials, have more complex construction, and may cost considerably more…
…BUT complex technologies may be far more effective clinically than older technologies and may allow treatment where no older technology could, and with low initial sales (penetrated potential), growth on a percentage bases will be high (see area in green).
Country and Regional Variation in Growth Rates
While this size-to-growth dynamic exists for most product types, the dynamic varies from one geographic region to the next. The time point at which a particular product/technology starts to be more rapidly adopted — or the rate at which use of established products are use starts to decline — can vary considerably from country to country.
As a result, there will be variability in sales growth rates for a product in one country/region versus another.
For example, the 2017 to 2026 compound annual growth rate in sales of Alginates in wound management range from a low of 5.3% in one country to a high of 24.3% in another country. (If you make alginates, in which country would YOU like to compete?)
Regionally, as in USA versus Europe versus Asia/Pacific, etc., there is less variation in growth rates for any given product in that region. For alginates:
country-to-country variation in CAGR: 19%
region-to-region variation in CAGR: 7.8%
In other words, the difference between the countries with the highest and lowest CAGRs for alginate sales is 19%, while the difference between regions shows one region with a 7.8% higher CAGR for alginates than the lowest growth region.
Here we assess the specific products and geographic areas showing the highest growth in wound management product sales, drawn from our global report and its forecasts, “Wound Management, Forecast to 2026.” Report S254.
We assess the 10-year sales size and growth for 13 different wound product segments worldwide, in major geographic regions and individual countries — USA, Rest of N. America, Latin America, Europe, United Kingdom, Spain, France, Germany, Italy, Rest of Europe, Asia/Pacific, Japan, Korea, China, Rest of Asia/Pacific, Rest of World.
Below we show the top 15 combinations of regional market and product segments in descending order of their compound annual growth rate from 2017 to 2026.
As becomes clear, the greatest relative growth in sales in the area of wound management is in several wound care product types — bioengineered skin & skin substitutes, growth factors — and the geographic regions of Japan, Rest of World, China, Germany, Asia-Pacific. This reflects the high level of investment and attention in Asian markets, especially China.
We present data from our 2016 to 2026 forecast of the global market for wound management products (report #S254, published March 2018).
At a glimpse, you can see the overall trend in global wound management, including the relative size of each market. (The four regional sales charts are shown on the same scale to illustrate this.) Most notably, the USA dominance of this global market is fading, as aggregate Asia/Pacific sales of all wound products will eclipse USA sales within the forecast period.
Looking at just the aggregate of all wound product types, Asia/Pacific relative sales are squeezing out shares in every other region.Source: MedMarket Diligence, LLC; Report #S254.
When we then look specifically at the USA versus Asia/Pacific, it illustrates that by 2020, Asia/Pacific’s sales of wound management products will eclipse those of the U.S., making it the largest regional wound management market.
Over the 2017 to 2026 period, the compound annual growth rate for the entire wound management market will approach 6%, a respectable rate of growth for an established market, though not quite high enough to encourage investment in the market as a whole.
Of course, the total wound market is comprised of a number of VERY large, slow-growing segments, like traditional adhesive dressings, gauze dressings, and non-adherent dressings, which have annual sales at $3.8 billion, $3.2 billion, and $1.3 billion, respectively.
The large volume, slow growth of the aggregate masks growth in the following segments:
Bioengineered skin and skin substitutes
These wound care segments have had, and will continue to have, annual growth rates at or near double-digit through 2026.
The end result of variable growth rates is that the 2026 Wound Care Market (worldwide), by comparison to 2017, will show the following changes (up/down) in each segment’s share of the total market.
Source: MedMarket Diligence, LLC; Report #S254 (publishing Mar. 2018).
Big revenues, as in $ billions, are turned over every year in traditional wound dressings and gauze, while emerging technologies designed to have far more impact on wound management are driving the fastest percentage revenue growth. Data from “Wound Management to 2026” (report S254) shows the size-to-growth distribution of wound product revenue streams over the 2017 to 2026 period.
Surgical sealants, glues, and hemostats are now a routine part of closing and managing wounds, with their use determined by demand from patients, surgeons, and healthcare systems that has in turn been enabled by innovations from technology development.
From our global analysis of sealants, glues, and hemostats, here are the elements that determine the forecast for their sales:
Product adoption trends, driven by better formulations, especially for use in MIS and other applications
Growth in different formulations developed for different clinical applications
Geographic market growth patterns and trends
Growth in minimally invasive surgical procedures
Growth in products designed to work in MIS procedures
Growth rates driven by growing clinical utility
Surgeon preferences and adoption rate
Geographic market shifts (slowing growth rates in the U.S. and burgeoning growth in A/P, especially China due to its effort to modernize its healthcare system)
Demographically driven population shifts — age-related demand
Growth in surgical procedure volumes in MIS and other applications
Growth in the # of procedures performed in ambulatory surgical centers and doctors offices
Companies in the Market
Companies focused on wound closure find plenty of competition. Below is a selected list of current companies active in this field. M&A and even new startups will mold this list over the next five years.
The cumulative result of all these forces, drivers, and trends is a market with significant growth in some geographic markets and specific products. One need only consider the hemostat market to recognize these trends.
Here are six key trends we see in the global market for surgical sealants, glues, and hemostats:
1. Aggressive development of products (including by universities, startups, established competitors), regulatory approvals, and new product introductions continues in the U.S., Europe, and Asia/Pacific (mostly Japan, Korea) to satisfy the growing volume of surgical procedures globally.
Source: Report #S290. “Worldwide Markets for Medical and Surgical Sealants, Glues, and Hemostats, 2015-2022.”
2. Rapid adoption of sealants, glues, hemostats in China will drive much of the global market for these products, but other nations in the region are also big consumers, with more of the potential caseload already tapped than the rising economic China giant. Japan is a big developer and user of wound product consumer. Per capital demand is also higher in some countries like Japan.
3. Flattening markets in the U.S. and Europe (where home-based manufacturers are looking more at emerging markets), with Europe in particular focused intently on lowering healthcare costs.
4. The M&A and deal-making that has taken place over the past few years (Bristol-Myers Squibb, The Medicines Company, Cohera Medical, Medafor, CR Bard, Tenaxis, Mallinckrodt, Xcede Technologies, etc.) will continue as market penetration turns to consolidation.
5. Growing development on two fronts: (1) clinical specialty and/or application specific product formulation, and (2) all purpose products that provide faster sealing, hemostasis, or closure for general wound applications for internal and external use.
6. Bioglues already hold the lead in global medical glue sales, and more are being developed, but there are also numerous biologically-inspired, though not -derived, glues in the starting blocks that will displace bioglue shares. Nanotech also has its tiny fingers in this pie, as well.
See Report #S290, “Worldwide Sealants, Glues, and Hemostats Markets, 2015-2022”.