Global Growth in Spine Surgery

Spine surgery is a relatively mature market — all segments of the spine can be treated, significant share has been garnered by a few major companies, and there are no radically new technologies disrupting current market positions. Yet, trends in the patient population, the active innovation by all companies (see further, below, on market shares per region), the fact that it remains an invasive procedure (even the best minimally invasive approaches have room for improvement), and the accelerating migration of advanced spine technologies to developing non-U.S. markets are all reasons why this “mature” market is anything but stagnant.

Success in applying minimally invasive approaches to spine fusion has opened up procedure volumes for more patients, resulting in the fastest growing area of spine fusion sales. Fusion devices are strong worldwide, with the non-U.S. markets lagging in volumes, but growing at markedly faster rates.

Below is illustrated the segment growth rates for major geographic regions.

Screen Shot 2015-08-27 at 8.39.15 AM

Source: MedMarket Diligence, LLC; Report #M540

The result of the faster non-U.S. growth is that the dominance of U.S. spine surgery markets will decline over the next decade. Below is the change in the share of the global spine surgery market represented by each reach from 2014. For example,  the U.S. market will lose 6% of the global market between 2014 and 2021, while Asia-Pacific will gain roughly 5%.

Screen Shot 2015-08-27 at 7.46.20 AM

Source: MedMarket Diligence, LLC; Report #M540

A two-tier market

The big players (Medtronic, DePuy, Stryker, Zimmer-Biomet) cumulatively control a large swath of the spine surgery market, yet many millions of dollars streams to hungry and innovative smaller spine companies. For example, below is the distribution of market shares for cervical fusion globally.

cervical fusion mkt shares by region

Source: MedMarket Diligence, LLC; Report #M540

 

 

 

What is spine surgery?

What is spine surgery? Specifically it’s:

  • Anterior Lumbar Interbody Fusion (ALIF)
  • Anterior Cervical Corpectomy
  • Anterior Cervical Discectomy and Fusion (ACDF)
  • Axial Lumbar Interbody Fusion (AXiaLIF)
  • Cervical Laminaplasty
  • Cervical Posterior Foraminotomy
  • Direct Lateral Interbody Fusion (DLIF)
  • Discectomy
  • Endoscopic Surgery
  • eXtreme Lateral Interbody Fusion (XLIF)
  • Foraminotomy and Foraminectomy
  • Intradiscal Electrothermal Therapy (IDET)
  • Kyphoplasty
  • Laminectomy
  • Laminoplasty
  • Laminotomy
  • LASER Surgery
  • Microdiscectomy (Minimally Invasive Technique)
  • Oblique Lumbar Interbody Fusion (PLIF)
  • Posterior Lumbar Interbody Fusion (PLIF)
  • Scoliosis Correction
  • Spinal Decompression
  • Spinal Fusion
  • Spinal Instrumentation
  • Spinal Osteotomy
  • Thoracoscopic Release
  • Transforamenal Lumbar Interbody Fusion (TLIF)

These represent the range of options to address diseases and trauma of the spine. To varying degrees, these procedures can require multiple instruments and/or implants and other products, which encompass the following:

  • Cervical interbody cages or spacers
  • Anterior cervical plates
  • Artificial cervical discs
  • Thoracolumbar plate systems
  • Interbody fusion devices
  • Thoracolumbar screw/rod systems
  • Minimally invasive implants
  • Artificial disc replacement implants
  • Interspinous implants
  • Demineralized bone matrix
  • Synthetic bone graft substitutes

See pending Report #M540.

Spine surgery largely unfazed by recent market challenges

Few medical device markets have demonstrated the kind of staying power — prices, procedure growth, market growth — shown by spine surgical technologies.  The swelling caseload of new patients, the persistent clinical need and the stream of innovations from manufacturers in this arena have enabled growth rates that have not recently been seen in most other device markets.

Of course, the market has been pinched by insurer pushback on some procedures (e.g., fusion when degenerative disc disease is involved), price pressures on some established devices and, in the U.S., regulatory reform that is long in coming.

A definite kind of demand inelasticity exists in spine disorders and trauma that has enabled it to be an area in which manufacturers have been able to succeed despite the capital restrictions and recessionary forces that have plagued markets since at least 2008.

Spine surgery technologies are comprised of the following discrete segments:

  • Posterior Pedicle Screw Fusion Systems
  • Anterior Cervical Plate Systems
  • Anterior Thoracolumbar Plate Systems
  • Anterior Lumbar Interbody Fusion (ALIF) devices
  • Transforaminal Lumbar Interbody Fusion (TLIF) devices
  • Posterior Lumbar Interbody Fusion (PLIF) devices
  • Axial Lumbar Interbody Fusion (AxiaLIF) devices
  • Interspinous Process Spacer (ISP)
  • Cervical Artificial Discs
  • Lumbar Artificial Discs
  • Vertebroplasty
  • Balloon Kyphoplasty
  • Allografts
  • Demineralized Bone Matrix (DBM)
  • Bone Morphogenetic Proteins (BMPs)

Below is an exhibit (drawn from the 2011 MedMarket Diligence worldwide report on spine surgery) illustrating the different growth in spine surgery technology segments.

Source: MedMarket Diligence Report #M520.

Posterior pedicle screw fusion systems currently represent the largest share of the global spine technology market, a dominance that will persist through the forecast period based on its large established base. However, as is evident in the uptake of new spine technologies, there is ample opportunity for participants in all but a few sectors that are declining in absolute or relative terms.