Extremities, Emerging Markets Continue To Top M&A; Ortho Interest

Article preview from IN VIVO - June, 2013

With hip and knee joint markets still registering slow to modest growth, orthopedic companies looking to add bulk to their bottom line through mergers and acquisitions have pursued two distinct directions – the extremities and emerging markets.

Extremities, Emerging Markets Continue To Top M&A Ortho Interest

Article preview from IN VIVO - June, 2013

With hip and knee joint markets still registering slow to modest growth, multinational orthopedic companies are compelled to go to where the growth is. Over the past three years, orthopedic companies looking to add bulk to their bottom line through mergers and acquisitions have pursued two distinct directions – the extremities and emerging markets.

In the past month this path was taken once again by Zimmer Holdings Inc., which acquired Tuttlingen, Germany’s Normed Medizin-Technik GMBH, a small bone specialty company. Earlier this year, Zimmer introduced its own total ankle replacement, the Trabecular Metal Ankle system. Zimmer sees the ankle as a natural extension of its growing focus in extremities.

Terms of the Normed acquisition weren’t disclosed, but a spokesman for Zimmer said the German company gives Zimmer a “full complement of foot and ankle plates and screws to complement the Company's recently launched ankle.” The Zimmer spokesman says Normed also will bring additional foot, ankle, hand, and wrist products for Zimmer. Large orthopedic companies are lining up against companies specializing in extremities like Small Bone Innovations Inc. and Tornier NV’s Tornier Inc., competing both for business as well as attractive acquisition targets. Richard Newitter, director of medical supplies and devices research at Leerink Swann & Co., says orthopedic companies “increasingly are focusing on extremities…one of the few growth areas” in orthopedics.

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