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In his introduction to the Arthroscopy/Soft Tissue Repair chapter of THE ORTHOPAEDIC INDUSTRY ANNUAL REPORT®, C. Scott Humphrey, M.D., made note of the most serious market force that will affect the segment over five years: surgeon incentives.
With surgeons migrating from private practice to hospital employment, he said, motivations change. Hospital administrators place employed surgeons on committees to help control costs by standardizing O.R. equipment and implants. Thus, a limited number of OEMs get in the door. This, Dr. Humphrey points out, makes it that much harder for newer or smaller companies to be considered…possibly hindering advancement in the field, since those small, agile companies are historically the drivers of innovation.
By our estimate, 91% of the arthroscopy/soft tissue repair market is controlled by seven companies with fairly broad portfolios and annual segment revenues over $100 million…and of those seven, Arthrex and Smith & Nephew tower atop the list with revenues more than $1 billion. Next come DePuy Synthes, Stryker, ConMed, Zimmer Biomet and Karl Storz. After that, we estimate about 120 companies with revenue below $99 million.
Who are those smaller companies? Further, which ones are innovating?
We looked at funding, patent and trial/study announcements from January 2017 to June 2018 to see whose initiatives are making waves.
To Dr. Humphrey’s point about innovation, many of the companies on this list offer technologies that we believe would make them interesting acquisition or joint collaboration targets for larger companies with solid hospital contracts.
Active Implants | Memphis, Tennessee, U.S. | Founded 2004
NuSurface Meniscus Implant: A polycarbonate-urethane device that mimics the function of the natural meniscus and redistributes loads transmitted across the knee joint. The device has been used in Europe under the CE Mark since 2008 and in Israel since 2011. The SUN and VENUS U.S. clinical trials completed enrollment in 2Q18, and the company expects to file for FDA De Novo 510(k) clearance for the device within two years.
BioRez |Â New Haven, Connecticut, U.S. | Founded 2008
Unnamed tissue-engineered device for anterior cruciate ligament reconstruction: The approach uses a scaffold on which a patient’s own cells may grow a new ligament before the implant is fully resorbed by the body. This may obviate the need to harvest a patient’s tendon to perform reconstruction. Within 2018, the company closed a $1.5MM funding and affirmed plans for 2019 launch of human clinical studies.
CartiHeal |Â Kfar Saba, Israel | Founded 2009
Agili-C Unicondylar Implant: A cell-free, off-the-shelf implant to treat cartilage and osteochondral joint defects. The porous, biocompatible, resorbable bi-phasic scaffold is made of interconnected calcium carbonate. Agili-C is the subject of a 250-patient U.S./ex-U.S. Investigational Device Exemption study comparing it to microfracture and debridement in the treatment of joint surface lesions.
Cartiva (acquired by Wright Medical in 3Q18) | Alpharetta, Georgia, U.S. | Founded 2011
Synthetic Cartilage Implant (SCI): A cylinder-shaped organic polymer-based replacement for damaged articular cartilage. It received FDA Premarket Approval in 2016 to treat arthritis of the great toe, representing what is reported to be the first synthetic cartilage device to gain such approval. Five-year follow-up study results have demonstrated that SCI provided long-term durability in pain and functional improvements in the treatment of great toe arthritis, and the company has begun patient enrollment in a study treating carpometacarpal joint osteoarthritis in the thumb.
Ceterix | Menlo Park, California, U.S. | Founded 2010
NovoStitch Pro Meniscal Repair: An instrument that allows surgeons to place stitches arthroscopically in tight joint compartments to treat complex meniscal tears in knees, hips and shoulders. The next-gen iteration gained FDA 510(k) clearance in 3Q18, which followed the 1Q completion of enrollment in a prospective, non-randomized, multi-center investigation of all-suture-based repair of horizontal meniscal tears vs. other suture-only techniques, noting improvements in pain and function. The first patient was enrolled in 2014.
CoNextions | Salt Lake City, Utah, U.S. | Founded 2011
CoNextions TR: A stainless steel and ultra-high molecular weight polyethylene implant designed as an alternative to sutures for surgical repair in digital flexor and extensor tendons. It is intended to provide stronger repair to enable early active motion, a simpler and faster surgical technique, etc. In 2018, the company commenced enrollment in a clinical trial comparing the system to suture repair to treat Zone 2 tendon lacerations.
Hyalex Orthopaedics | Lexington, Massachusetts, U.S. | Founded 2016
HYALEX synthetic polymer: Artificial cartilage, designed to mimic hyaline cartilage to potentially replace only diseased areas of joints while sparing healthy bone. The company has products in its pipeline for multiple joints based on this technology, including hip, knee, shoulder, hand, wrist, foot and ankle. Johnson & Johnson Innovation participated in the company’s $16MM Series A financing.
OrthoSpace | Caesarea, Israel | Founded 2009
InSpace: A biodegradable balloon for rotator cuff repair. The device provides space between the acromion and the humeral head, allowing frictionless gliding between the two bones, imitating the function of the original bursa. InSpace is CE Marked in Europe and Israel and investigational in the U.S. and Canada, where it is being evaluated in a prospective, single-blinded, multi-center, randomized, controlled study of 184 patients.
Orthonika |Â Knightsbridge, London, U.K. | Founded 2014
MenisciKnit: A novel synthetic polymer total knee meniscus replacement. In 2017, the company closed an investment round of £0.7MM (~US $0.9MM) to support biomechanical testing and a preclinical pilot trial.
Trice Medical | King of Prussia, Pennsylvania, U.S. | Founded 2011
mi-eye 2: A handheld, single-use visualization tool comprising a wide-angle camera lens embedded in a disposable needle. Physicians diagnose in a clinic, under local anesthetic, to assess joint conditions affecting the knee, shoulder or hip. Available in the U.S. since 2017, and Canada in 2018. Earlier this month, Trice Medical added ultrasound capability to mi-eye, in the form of 15mHz handheld transducer optimized for musculoskeletal applications.
Ziptek | Sarasota, Florida, U.S. | Founded 2011
ZipE: A resorbable knotless low-profile suture button that is deployed like a zip-tie and designed to create a larger tissue-to-bone contact area, reducing the potential for gap formation and providing a stronger construct to resist rip-through. Launched in late 2017, and the company has distribution agreements throughout the U.S.
