If you are like me and your parents are of the “baby boomer” generation (meaning they were born between 1946 and 1964), you may have heard the phrase “my back hurts” more often than once. There’s nothing wrong with that—it is simply something that comes with age. However, that phrase is much more than just a reminder that you’re still young and don’t have to worry about back pain quite yet; it signals something else: a way to profit from pain. Simply put, orthopedics is the branch of medicine relating to the treatment of deformities of bones and muscle. Like all other medical or surgical practices, it has a long and storied history. The field of orthopedics is nothing new, and in fact, orthopedic surgery has been practiced since the early middle ages—obviously, the field has advanced since then, as the first orthopedic procedure involved a bandage soaked in horse blood to create a splint on medieval battlefields. By the 17th century, orthopedics had become a term that applied to the correction of deformities in children. The first procedures consisted of splints, manipulation, and exercise at this point.
When the second industrial revolution rolled around, the need for new orthopedic practices exploded. Industrial workers working in canals, factories, and mines required much more comprehensive procedures to deal with the large amount of accidental injuries sustained from their lovely jobs. Put bluntly, workers were getting beaten up more than ever. By the second half of the 19th century, Hugh Owen Thomas, a surgeon from Wales, began a path to innovation by inventing the ‘Thomas Splint’ to treat compound fractures and prevent other ailments that often came with compound fractures, such as tuberculosis. His nephew, Robert Jones, further innovated as the Surgeon-Superintendent for the Manchester Ship Canal in 1888. During this time, he was responsible for the well-being of approximately 20,000 workers.
Jones was able to create a maximally efficient system for treating injuries with a multitude of field hospitals and rigid organizational structure, attracting surgeons from around the world to come study his techniques. By the First World War, Jones had been called into service as a Territorial Army Surgeon, meaning that he was responsible for the construction and organization of field hospitals for the British military. With this appointment, Jones was able to further spread his knowledge of orthopedics to the international stage. The rest is history.
Over the next century, development of orthopedics accelerated rapidly, with major breakthroughs such as bone cement, hip replacement, knee replacement, and many other techniques and inventions coming to the limelight of the medical world. Today, the orthopedic industry is highly specialized, with companies such as Xtant Medical (XTNT), NuVasive Inc. (NUVA), Johnson & Johnson (JNJ), and much more creating products to treat physical ailments of all kinds. Lucky for you, the investor, a current and growing catalyst is heating up the entire industry: age.
In 2009, baby boomers accounted for 360,000 knee replacement surgeries. According to projections, they will account for over 1,000,000 knee replacement surgeries in 2030. While this is not exactly good news for boomers or society in general, it will inevitably propel the sale of orthopedic products skyward. The orthopedic braces and supports market alone, which mainly specialize in products that treat osteoarthritis, is set to grow by 6.7% by 2030. Simply by looking at stock price trends of major orthopedic manufacturing companies, such as Stryker Corporation and Zimmer Biomet, it is overwhelmingly visible that the only way to go is up.
Boomers, unlike previous generations, don’t shy away from medical technology or joint surgeries. Even those who are in their 40’s and 50’s are getting surgery to stay active. In the end, aging isn’t a bad thing - it’s natural. Although surgery isn’t looked at as a very positive thing, the growing number of orthopedic surgeries should be an affirming reminder that our elders (or your generation if you’re that age) want to stay active and healthy—not just for them, but for their children and grandchildren. That, in the grand scheme of things, is even better than those sweet profits you can make off trading orthopedic companies—well, might be a close second.
Works Cited:
Allday, Erin. “As Baby Boomers Age, Number of Joint Replacements Soar.” The Seattle Times, August 10, 2010. http://www.seattletimes.com/seattle-news/health/as-baby-boomers-age-number-of-joint-replacements-soar/.
Dyrda, Laura. “5 Largest Orthopedic Companies Have 61% of Market Share.” Accessed August 27, 2017. http://www.beckersspine.com/orthopedic-a-spine-device-a-implant-news/item/32999-5-largest-orthopedic-companies-have-61-of-market-share.html.
GmbH, finanzen net. “Orthopedic Braces and Supports Market Expected to Grow at 6.7% CAGR From 2014 To 2025: Million Insights.” Markets.businessinsider.com. Accessed August 27, 2017. http://markets.businessinsider.com/news/stocks/Orthopedic-Braces-and-Supports-Market-Expected-to-Grow-at-6-7-CAGR-From-2014-To-2025-Million-Insights-1002265076.
“More and More Baby Boomers See Orthopedic Surgeons | Articles | Main.” Accessed August 27, 2017. http://www.healthcarecommunication.com/Main/Articles/14339.aspx.
Exscribe. “Orthopedics to Show Major Growth in Coming Years,” April 18, 2013. http://www.exscribe.com/orthopedic-e-news/orthopedic-news/orthopedics-to-show-major-growth-in-coming-years.
“Orthopedic Surgery.” Wikipedia, August 25, 2017. https://en.wikipedia.org/w/index.php?title=Orthopedic_surgery&oldid=797264669.
“US Orthopedic Trauma Device Market To Exceed 8 Billion By 2020.” Accessed August 27, 2017. https://www.meddeviceonline.com/doc/u-s-orthopedic-trauma-device-market-to-exceed-eight-billion-dollars-0001.