Healthcare Technology Featured Article

February 09, 2012

European Market for Orthopedic Biomaterials to Stumble Due to Increased Competition, Lower Reimbursement, Debt Crisis

The European orthopedic biomaterials market, a $350 million industry, is in for a huge challenge – fierce competition, an environment of reduced reimbursement, limited hospital budgets, and even, the European debt crisis, according to Millennium Research Group (MRG), a global provider of medical technology market intelligence.

MRG reports in the press release that more than 70 companies sell orthopedic biomaterials products in Europe.

The competition is intense. MRG notes that “all segments of the European orthopedic biomaterials market have many local and multinational companies vying for market share.”

The good news, according to MRG, is that last year, not a single competitor held more than a quarter of the European market in any category.  But today, orthopedic biomaterials companies have wised up and are fiercely working at maintaining or gaining market share, “including marketing efforts to increase brand awareness among patients and physicians, conducting clinical trials to demonstrate product efficacy and safety and increasing the range of products offered in order to cater to varied physician preferences,” according to the press release.

In addition, other tactics being used include providing product bundling and volume discounts to appeal to cost-conscious physicians, facilities and patients, according to the press release.

Because of the debt crisis, reduced reimbursement and more limited hospital spending will increase the decline in prices “resulting from strong competition,” according to MRG.

MRG predicts in the press release that, because of the cuts, “many public hospitals across Europe will be limiting access to elective and nonessential procedures to save money, including” such orthopedic biomaterials and procedures as “hyaluronic acid viscosupplementation and knee cartilage repair procedures, and cutting the use of premium-priced products, (including) as bone morphogenetic proteins in the bone graft substitute market.”

As a result, suppliers are becoming increasingly more attuned to the needs of  the private healthcare market “by working closely with individual physicians, providing incentives through bundling options and discounts and working to raise patient awareness and demand,” the press release states.

"Despite the economic constraints, we will still see continued marketing efforts by companies, as well as the launch of some new products," said MRG analyst Jennifer Smith, in the press release. "In the bone graft substitute segment, Medtronic Spinal & Biologics will continue to strongly promote their BMP product, INFUSE, due to its high success rate, while Olympus Biotech's Opgenra (formerly Stryker's product), Cerapedics' i-FACTOR Flex and BioMimetic Therapeutics' Augment growth factor have either launched or will soon."

The picture is much different in the US. MRG reported in another press release that the US market for orthopedic biomaterials will grow to approximately $4 billion by 2016. But all is not rosy. MRG also predicts that “lower reimbursement rates from insurers will limit average selling prices.”

Deborah DiSesa Hirsch is an award-winning health and technology writer who has worked for newspapers, magazines and IBM in her 20-year career. To read more of her articles, please visit her columnist page.

Edited by Rich Steeves

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