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Market resilience of orthopaedic hip/knee arthroplasty sales during COVID-19

  • Hip Arthroplasty
  • Published:
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Abstract

Introduction

The coronavirus 2019 (COVID-19) pandemic led to a marked decrease in elective surgical volume and orthopaedic device sales. The aim of this paper was to quantify this decrease and the related financial impact on the largest hip/knee arthroplasty companies by: (1) tracking individual hip/knee company valuations; (2) calculating aggregate changes in overall hip/knee arthroplasty market valuations; and (3) quantifying quarterly hip/knee revenues relative to prior years.

Materials and methods

Financial data on the top five hip/knee arthroplasty companies by size between January 1, 2019, and October 1, 2020, was collected from a Wall Street financial database, S&P Capital IQ. Changes in valuation of these companies were compared against benchmark market indices, the S&P500 and Vanguard Healthcare ETF. U.S. hip/knee arthroplasty-specific revenue for Q1 and Q2 of 2019 and 2020 was collected from Securities Exchange Commission 10-Q forms. Quarterly revenue changes were calculated using 1-2Q19 revenues as baselines and aggregate to approximate the overall hip/knee arthroplasty market.

Results

The top five hip/knee companies lost $179.2 billion (32.7% loss) in market value from pre COVID-19 market highs to COVID-19 market lows (March 2020), while S&P500 and Vanguard Healthcare ETF decreased 36.1 and 33.2%, respectively. From market lows to October 2020, arthroplasty companies rallied 38.6% while the S&P500 and Vanguard Healthcare ETF regained 43.5 and 56.4% respectively. Notably, this occurred while aggregate 1Q/2Q20 revenue lagged 7.1/41.8% relative to 2019, with an overall decrease of $1.58B (24.8%).

Conclusions

Similar to the overall market and healthcare sector, the top five hip/knee arthroplasty companies have recovered from their COVID market lows. Our results reveal that the valuations of hip/knee companies remained robust during COVID, even as revenues fell, likely due to strong investor confidence in the industry outlook and the greater overall healthcare system utilization.

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Funding

No funding was received to assist with the preparation of this manuscript.

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Authors and Affiliations

  1. Department of Orthopaedic Surgery, Maimonides Medical Center, Brooklyn, NY, 11219, USA

    Mitchell K. Ng, Afshin E. Razi & Che Hang Jason Wong

  2. Department of Orthopaedic Surgery, Cleveland Clinic, Cleveland, OH, 44195, USA

    Andy Kuo & Nicolas S. Piuzzi

  3. Department of Orthopaedic Surgery, School of Medicine, State University of New York (SUNY) Downstate, Brooklyn, NY, 11203, USA

    Patrick P. Nian

  4. Healthcare Investment Banking, Ferghana Partners Group, New York, NY, 10170, USA

    William J. Kridel Jr.

  5. Department of Orthopaedic Surgery, Lenox Hill Hospital, New York, NY, 10075, USA

    Michael A. Mont

  6. Department of Orthopaedic Surgery, Rubin Institute for Advanced Orthopaedics, Sinai Hospital of Baltimore, Baltimore, MD, 21215, USA

    Michael A. Mont

  7. College of Medicine, SUNY Downstate Health Sciences University, 450 Clarkson Avenue, Brooklyn, NY, 11203, USA

    Patrick P. Nian

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Contributions

Conceptualization: Mitchell K. Ng, William J. Kridel Jr., Nicolas S. Piuzzi. Methodology: Mitchell K. Ng, William J. Kridel Jr., Nicolas S. Piuzzi. Formal analysis and investigation: Mitchell K. Ng, Andy Kuo, Patrick P. Nian. Writing - original draft preparation: Mitchell K. Ng, Andy Kuo, Patrick P. Nian. Writing - review and editing: Mitchell K. Ng, Andy Kuo, Patrick P. Nian, Afshin E. Razi, Che Hang Jason Wong, Michael A. Mont, Nicolas S. Piuzzi. Funding Acquisition: N/A. Resources: Mitchell K. Ng, William J. Kridel Jr. Supervision: Mitchell K. Ng, Afshin E. Razi, Che Hang Jason Wong, Michael A. Mont, Nicolas S. Piuzzi.

Corresponding author

Correspondence to Patrick P. Nian.

Ethics declarations

Ethical approval

The current investigation was exempt from our institution’s Institutional Review Board (IRB) approval process.

Conflict of interest

Mitchell Ng, MD: Paid consultant at Ferghana Partners, Inc. Nicolas Piuzzi, MD: Paid research support at Regenlab and Zimmer, Board member/committee member of ISCT and Orthopaedic Research Society. Michael Mont, MD: Royalties from Microport, Stryker. Paid consultant at DJ Orthopaedics, Johnson and Johnson, Medical Compression Systems, Merz, Orthosensor, Pacira, Sage Products, Inc., Stryker, Tissue Gene, US Medical Innovations. Research support from DJ Orthopaedics, Johnson and Johnson, National Institutes of Health (NIAMS and NICHD), Ongoing Care Solutions, Orthosensor, Stryker, Tissue Gene. Medical/orthopaedics governing board of American Journal of Orthopaedics, Journal of Arthroplasty, Journal of Knee Surgery, Orthopedics, Surgical Technology International. Board member of American Academy of Orthopaedic Surgeons. Andy Kuo, Patrick Nian, William Kridel, Afshin Razi, Che Hang Jason Wong have no disclosures to report.

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Ng, M.K., Kuo, A., Nian, P.P. et al. Market resilience of orthopaedic hip/knee arthroplasty sales during COVID-19. Arch Orthop Trauma Surg 144, 1835–1841 (2024). https://doi.org/10.1007/s00402-024-05228-2

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  • DOI: https://doi.org/10.1007/s00402-024-05228-2

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