By 2020, the elderly are expected to comprise almost a quarter of Europe's total population. This changing demography is set to underpin a rise in the incidence of age-related orthopaedic problems such as osteoarthritis, osteoporosis, degenerative disc disease (DDD), herniated disc and spondylolysis, triggering significant demand for orthopaedic braces and supports.
The orthotics market is also set to receive a boost from technological advances. The increasing use of computer-aided design/computer-aided manufacturing (CAD/CAM) technology and the development of new materials such as carbon fibre reinforced plastics (CFRPs) or fibre reinforced plastics (FRPs) are poised to promote the creation of effective and innovative products, while opening up applications in numerous niche markets. Ongoing robotic orthosis projects, focussed on the development of a variety of specialised limb orthosis, also hold promise.
"Suppliers have been responsible for stimulating growth in the market not only through the development of new and innovative products, but also by providing product education and training to the end-users," says Frost & Sullivan Research Analyst Paul Taylor. "This has helped reinforce the efficacy of braces and supports and has helped increase their usage in different applications."
Despite these positive signs, two key challenges confront orthotics manufacturers over the near to medium term. First, continued healthcare reforms and budgetary restraints are placing increasing pressure on prices. Manufacturers have had to respond to tightened healthcare outlays by undertaking price reductions and/or providing value-added services.
Poor or low reimbursement values for orthotic products across many European countries present another critical challenge. For instance, Italy, with a few exceptions, does not provide reimbursement for orthotic products. Many patients in systems such as this, are therefore, forced to compromise and accept low-priced products. As a result, demand levels are expected to be negatively impacted.
"The principal challenge to the industry is to seek ways and methods by which market access may be improved by not impeding competitiveness, innovation and rapid access to markets by avoiding unnecessary constraints on industry that are not necessarily from a public health point of view," comments Mr. Taylor.
Escalating demand from a rapidly ageing population and the introduction of new and sophisticated products providing improved clinical outcomes are poised to boost the revenue share of orthopaedic braces within the total orthopaedic bracing and support market, from an estimated 69.2 per cent in 2003 to 70.2 per cent in 2010.
The orthopaedic braces segment is set to become increasingly specialised in terms of both products and value-added services. Increased product differentiation - such as products catering to specialist sports medicine - is expected to help leverage emerging niche markets. Apart from sports medicine, another promising niche market is that of hip orthosis. These are gaining appeal as a method to help prevent dislocations of both primary and revision surgery of the hip.
The smaller European orthopaedic supports segment is expected to grow at an annual average growth rate of 3.7 per cent over 2003-2010. Here too, revenue growth is expected to be supported by an ageing population coupled with demonstrated product efficacy and augmented focus by leading suppliers on educational and product training for orthotists and prescribing clinicians.
Both major suppliers and smaller niche companies are active in the highly fragmented and competitive orthopaedic bracing and supports market. In some regions, the entry of new competitors and products is difficult due to the well-established presence of local competitors such as Bauerfeind in Germany, Tielle in Italy and Thusane in France.
"In order to maintain viability, it is expected that the industry will experience further acquisitions/mergers to gain and consolidate market share while acquiring new products to exploit prospective niche and emerging markets," says Mr. Taylor. "In addition, it is likely that further joint venture and co-marketing agreements will be created to exploit new technologies, enter new geographic markets and take advantage of additional distribution networks."