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Archives of orthopaedic and trauma surgery
Apr, 2024;144 (4): 1835-1841.

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

Mitchell K Ng, Andy Kuo, Patrick P Nian, William J Kridel, Afshin E Razi, Che Hang Jason Wong, Michael A Mont, Nicolas S Piuzzi
Author Information
  1. Mitchell K Ng: Department of Orthopaedic Surgery, Maimonides Medical Center, Brooklyn, NY, 11219, USA.
  2. Andy Kuo: Department of Orthopaedic Surgery, Cleveland Clinic, Cleveland, OH, 44195, USA.
  3. Patrick P Nian: Department of Orthopaedic Surgery, School of Medicine, State University of New York (SUNY) Downstate, Brooklyn, NY, 11203, USA. patrick.nian@downstate.edu. ORCID
  4. William J Kridel: Healthcare Investment Banking, Ferghana Partners Group, New York, NY, 10170, USA.
  5. Afshin E Razi: Department of Orthopaedic Surgery, Maimonides Medical Center, Brooklyn, NY, 11219, USA.
  6. Che Hang Jason Wong: Department of Orthopaedic Surgery, Maimonides Medical Center, Brooklyn, NY, 11219, USA.
  7. Michael A Mont: Department of Orthopaedic Surgery, Lenox Hill Hospital, New York, NY, 10075, USA.
  8. Nicolas S Piuzzi: Department of Orthopaedic Surgery, Cleveland Clinic, Cleveland, OH, 44195, USA.
PMID: 38386064 DOI: 10.1007/s00402-024-05228-2

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.

Keywords

COVID-19 Company revenue Economic impact Hip Joint Knee Market capitalization

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MeSH Term

Humans
Arthroplasty, Replacement, Knee
COVID-19
Orthopedics
Resilience, Psychological
Arthroplasty, Replacement, Hip
Journal Article

Word Cloud

Created with Highcharts 10.0.0hip/kneemarketarthroplastycompaniesCOVID-19overall201912020revenuedecreasevaluationsaggregaterevenuestopfiveS&P500VanguardHealthcareETFlowsorthopaedicsalesfinancialimpactchangesrelativeOctobercollectedrespectively8%healthcareCOVIDMarketINTRODUCTION:coronaviruspandemicledmarkedelectivesurgicalvolumedeviceaimpaperquantifyrelatedlargestby:trackingindividualcompany2calculating3quantifyingquarterlyprioryearsMATERIALSANDMETHODS:FinancialdatasizeJanuaryWallStreetdatabaseS&PCapitalIQChangesvaluationcomparedbenchmarkindicesUSarthroplasty-specificQ1Q2SecuritiesExchangeCommission10-QformsQuarterlycalculatedusing1-2Q19baselinesapproximateRESULTS:lost$1792 billion327%lossvalueprehighsMarchdecreased36332%rallied386%regained435564%Notablyoccurred1Q/2Q20lagged71/41$158B24CONCLUSIONS:SimilarsectorrecoveredresultsrevealremainedrobustevenfelllikelyduestronginvestorconfidenceindustryoutlookgreatersystemutilizationresilienceCompanyEconomicHipJointKneecapitalization

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