The past decade has brought multiple billion-dollar acquisitions in the spine device and technology space as the largest orthopedics-focused companies grow even bigger.
Here are four large acquisitions from the past 10 years that changed the spine market at the time and continue to have repercussions today.
1. Johnson & Johnson acquires Synthes for $19.7 billion
In 2012, Johnson & Johnson completed its purchase of Synthes for $19.7 billion and integrated it with its orthopedics franchise, DePuy, to establish DePuy Synthes Companies of Johnson & Johnson. The move secured Johnson & Johnson's spot at the top of the orthopedics market.
At the time, Johnson & Johnson CEO Alex Gorsky said, "The combination of these two respective leaders, Synthes and DePuy, will enable us to better serve clinicians and patients worldwide, bringing new innovations to the marketplace in orthopedics and neurologics, and strengthen our ability to compete in developing markets."
Since then, DePuy Synthes has continued to grow and launch successful products. Statista reports that Johnson & Johnson had 21.8 percent of the orthopedic market share in 2017, which is expected to grow to 24.2 percent in 2024. In recent years, Johnson & Johnson's orthopedic efforts have expanded to include robotics as well. The company acquired Orthotaxy, a next-generation robotic surgery platform, in 2018.
2. Medtronic acquires Mazor for $1.7 billion-plus
Medtronic first expressed interest in Mazor in 2016, when the two companies entered into a strategic commercial and investment arrangement to co-develop and promote new spinal robotic technologies and solutions. The initial agreement occurred in May 2016, with Medtronic agreeing to purchase 15 of Mazor's existing robotic systems while the two companies continued to develop next-generation technology.
Medtronic then invested $20 million in Mazor Robotics, giving it exclusive distribution rights for new spine products. The relationship between the two companies progressed quickly, and by December 2018 Medtronic had fully acquired remaining interest in Mazor for $1.7 billion.
Together, the companies developed Mazor X Stealth Edition, which was unveiled this past fall. The Stealth Edition combines Mazor's robotic technology with Medtronic's StealthStation robotics platform. The company aims to continue developing in the spinal robotic space, noting in a May 2019 earnings call that the company held 70 percent of the spine robotic market.
But Medtronic didn't stop there; earlier this year the company acquired spinal implant surface technology company Titan Spine for an undisclosed amount. Titan reportedly added $16 million to its spine division during the second quarter of the 2020 fiscal year.
3. Zimmer Biomet acquires LDR for $1 billion
In June 2016, Zimmer Biomet purchased LDR, a company known for its Mobi-C artificial disc, for around $1 billion. Zimmer Biomet aimed to integrate LDR's technology, which also included spinal fusion products, into its spine business and increase its global spine market footprint. The next month, Zimmer Biomet also acquired Medtech, a French company focused on robotic technology in the spine and brain market called ROSA.
However, Zimmer Biomet has spent more effort on its knee and hip businesses, which represent a larger portion of its overall sales. In 2018, the company reported spine and craniomaxillofacial sales flat at $764 million. For the third quarter of 2019, Zimmer Biomet reported spine and craniomaxillofacial sales dipped 2.8 percent.
During a quarterly earnings call in November, CEO Bryan Hanson tampered the company's expectations for the spine business going forward. "We don't expect to see real momentum shifting in [the spine] business until sometime in 2020," he said. "The primary drivers for this shift will be working through the final steps of our channel consolidation in spine and leveraging our new product pipeline, including the recent launch of the TrellOss titanium 3D printed interbody system, upcoming launch of robotics with ROSA Spine and the recently approved tether system [for scoliosis]."
4. Stryker acquires K2M for $1.4 billion
Stryker announced intentions to acquire K2M, a company focused on minimally invasive solutions for complex spine procedures, in August 2018, and the deal was complete less than three months later. At the time of acquisition, K2M's sales were approaching $300 million and it had delivered a double-digit compounded annual growth rate for the previous five years.
The acquisition significantly strengthened Stryker's spine offerings and capabilities. With the move, K2M CEO Eric Major became the president of Stryker Spine and continues efforts to integrate the two companies. "The integration has been a lot of work for everyone across the entire organization, but it has been a really exciting time," he said in an October 2019 interview. "As we walked into this integration, we looked at previous spine integrations, what has gone well and what hasn't gone well, and what can make this a best in class integration so we can focus on running our business."
In the past year, Stryker has continued to make smaller acquisitions in the spine and orthopedics space, including the $500 million acquisition of Mobius, a point-of-care imaging technology company. On the orthopedics side, Stryker signed a definitive agreement to acquire Wright Medical for $5.4 billion in November.