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The NASS 2022 Annual Meeting will feature more than 200 exhibiting companies serving the spine market, including a new prominent player — ZimVie. In March 2022, Zimmer Biomet spun off its spine and dental business, forming the publicly-traded company. With about $1 billion in annual revenue, 49% of which is spine-related, ZimVie’s size alone is a reason to watch the company.
After running a deep analysis of ongoing projects, leadership has stated the initial priority for ZimVie is to make cuts that result in exiting unprofitable geographies and optimizing its product portfolio. The company predicts that its spine business will decline in the mid- to high-single digits for 2022. But as ZimVie’s spine business stabilizes, the company plans to use its core spine products to fund faster-growing categories such as motion preservation and minimally invasive surgery.
ZimVie’s CEO, Vafa Jamali, is tasked with growing a business that was underprioritized and declining under its previous ownership. He is realistic about the company’s chances to contend with the largest players in core spine.
“Spine is a crowded market, and the biggest segment of that market is the core and complex, the rods and screws,” he said. “For us, a small player, it’s important to be very nimble and find areas where other people aren’t. We’re interested in growing pediatric scoliosis and the Mobi-C cervical disc, because in both of those markets, the bigger opportunity is not taking someone else’s share.”
Entering a Complex Environment
Despite the global supply chain upheaval, the COVID-19 pandemic and other challenges the orthopedic industry has faced in recent years, orthopedic device company executives remain optimistic about the industry.
That said, the spine market is facing volatility like never before, said Rebecca Whitney, Senior Vice President and President, Global Spine, ZimVie. The market begins to stabilize, and then certain regions are impacted unpredictably. Volatility in the spine market recovery is a trend that is expected to continue.
More complicated procedures are being prioritized and are bouncing back more so than basic procedures, she said, indicating prolonged softness in some procedure volumes relating to issues not directly connected to COVID.
“The more elective you are, the more likely you will be down-prioritized from something urgent, which I think is absolutely the right thing for communities and patients,” Jamali said. “For us, we ought to continue to be more flexible in terms of where our procedures are done, and how they’re done.”
Jamali has experience in being able to do that effectively to drive the system costs down.
“What’s important is that you just can’t add cost; you have to take away overall costs,” he said. “Part of those decisions could be moving from a facility, which is a higher-cost place to have a procedure done, to a lower-cost setting and get the same outcomes.”
Recent trends show spinal procedures increasingly moving toward ambulatory surgical centers, which drives down costs and is an area of focus for many spinal companies.
“The trend is really, really important for us,” Jamali said. “Again, if we want to be effective, we must be nimble and agile and address these things early.”
Focusing on Technology Innovation
As ZimVie seeks to make a splash in the spine market, they plan to do so by innovating where they can make an impact in areas where other companies are not, according to Jamali. They will do that by focusing on procedures and innovations that improve both workflow and outcomes.
The company is highly focused on pediatric scoliosis and The Tether technology, as well as cervical total disc replacement with its Mobi-C. The company is also investing in enabling technology capabilities.
“What we’ve missed so far in spine is that our outcomes haven’t improved dramatically, and the workflows are often a little bit more complicated. That combination is not ideal,” Jamali said.
Whitney agreed that the real opportunity for disruptive innovation lies beyond the implant. When talking about enabling technology, most people gravitate towards robotics. While that certainly has a place in the orthopedic sphere, she said, it has been slower to adopt in the spine segment — sometimes due to cost constraints. Being able to use data to predict with a high level of confidence how a patient should be treated, and using the right tech to make that happen, is where she believes orthopedics will move.
“I think the next step is to determine exactly which procedures need what type of support,” she said. “I think coupling that and being very mindful of the cost considerations at the same time is what will allow us to find a way to move some of this innovation forward.”
The company is looking at procedures where there may be a level of technical or visualization difficulty, where innovation can provide workflow benefits as well as the necessary capabilities that tech provides for a winning solution.
“It’s more about innovating around a procedure versus having a robot for the sake of having a robot,” Jamali said. “Sometimes the technology itself might cost more. It’s only okay to cost more if you take something else out of it, and that something else should be a return or an efficiency or an ability to turn the O.R. quicker, etc. That’s how I see us being able to innovate around this specialty.”
