Recently, Henry Schein, Inc. (Henry Schein), the world's largest dental giant providing healthcare solutions for dental clinics and medical institutions, announced plans to enter the specialized细分市场 of upper and lower limb orthopedics.

The company announced on December 22 that it has signed an agreement to acquire a majority stake in TriMed, Inc., a global developer of orthopedic treatment solutions for the lower extremities (foot and ankle) and upper extremities (primarily hand and wrist).

TriMed is headquartered in Santa Clarita, California.Net sales in 2022 were approximately $48 million.The transaction is subject to certain regulatory approvals and closing conditions and is expected to be completed in the first quarter of 2024. Henry Schein expects the transaction to be neutral to its 2024 non-GAAP earnings per share and accretive thereafter.The financial terms, including the acquisition amount, have not been disclosed yet.

In addition,Henry Schein also established a strategic partnership with Extremity Medical LLC, an innovative medical device company focused on developing new products for fusion, fixation, and motion preservation in lower extremity and wrist orthopedic treatments.Extremity Medical, headquartered in Parsippany, New Jersey, will operate as an independent company.

"Partnering with the TriMed and Extremity teams provides Henry Schein with a platform to become a leading manufacturer and supplier in the orthopedic market for foot and ankle as well as hand and wrist extremities," said Stanley M. Bergman, Chairman and Chief Executive Officer of Henry Schein, Inc. "We believe our experienced leadership team is well-positioned to leverage our deep and long-standing relationships with existing integrated delivery networks and ambulatory surgery centers."

After the acquisition is completed, TriMed founder and Chief Commercial Officer David Medoff, along with Medical Advisor Robert Medoff, M.D., will continue as members of the TriMed management team, bringing extensive experience to Henry Schein, particularly in product development and business relationships.

It is reported that Henry Schein, a nearly century-old medical device enterprise, was established in 1932. The company's headquarters is located in Melville, New York, USA. It is the world’s largest provider of healthcare products and services for office-based dental and animal health practitioners. The company has operations or affiliated organizations in 32 countries and regions. In 2004, Henry Schein was listed on the Fortune 500 for the first time, and since then, it has been included in the Fortune 500 for 19 consecutive years and ranked among the "World's Most Admired Companies" by Fortune for 21 consecutive years. With branches or operational institutions in 32 countries worldwide, Henry Schein employs 15,500 staff, serving over 800,000 customers globally with more than 300,000 products and 300 solutions.

In 1997, the company acquired Sullivan Dental Products for $318 million, becoming the world's largest distributor of dental equipment and supplies. Over the next 25 years, the company continued to acquire more than 40 additional businesses, further solidifying its position as the industry leader. Notably, multiple acquisitions occurred in 2023.

丨Acquisition of Brazilian Distributor to Further Expand Global Commercial Footprint

In July 2023, Henry Schein announced that it would enter the Brazilian dental implant market by acquiring S.I.N. Implant System. The financial details of the transaction were not disclosed, but it is understood that S.I.N. Implant System generated revenue of US$61 million (approximately RMB 440 million) last year.

丨Purchase of Home Medical Products

On August 20, 2023, Henry Schein announced that it had signed an agreement to acquire a majority stake in Shield Healthcare, Inc., a leading supplier of home medical products directly to patients' homes. The acquisition will further enhance Henry Schein's product portfolio and its ability to continuously provide home medical products.

It is reported that as early as 2021, Henry Schein acquired Prism Medical Products LLC to enter the home medical products field. The acquisition of Shield Healthcare represents the company's further investment in the home healthcare medical supplies market. Through this acquisition, Henry Schein's home medical products platform will have an annual revenue base of over $300 million.

TriMed, Inc. was founded in 1997 with the initial goal of developing a unique set of orthopedic implants aimed at treating complex distal radius fractures through ORIF. At that time, these implants outperformed existing methods used to repair complex wrist fractures and provided one of the first treatment options for ORIF in these complex injuries, ultimately optimizing patient outcomes. The success of TriMed's fragment-specific implants was a key component in the development of the first complete wrist fixation system. More importantly, the successful development of treatments for complex musculoskeletal pathologies and periarticular fractures in both the upper and lower limbs also became a driving force behind TriMed's innovative technology.

Over the past two decades, TriMed has been dedicated to developing a variety of orthopedic device solutions, including volar buttress plates (which allow surgeons to capture radial fragments without compromising plate position) and sidewinder plates (which achieve interfragmentary compression without relying on threaded fixation). TriMed has also expanded its expertise beyond periarticular fractures, currently offering multiple systems that utilize unique approaches to optimize patient recovery while enhancing operating room efficiency, including: ulnar osteotomy compression plates, clavicle systems, elbow and forearm systems, fifth metatarsal systems, and ankle fixation systems.

Despite being smaller than most of its competitors, TriMed's expertise in periarticular fractures has fueled the company's rapid growth in the orthopedics field.

"Through the new partnership with Henry Schein, we look forward to working together to find new opportunities to provide quality care for patients," said David Medoff, Founder and Chief Business Officer of TriMed. "TriMed offers unique treatment options for challenging indications and injuries. Henry Schein will help us accelerate our growth and expand our influence in the medical community."

Global Market Size of Orthopedic Devices

The "2023-2028 In-depth Market Research and Investment Prospect Forecast Analysis Report on the Orthopedic Device Industry" released by the New Think Tank Industry Research Center shows that in recent years, with the continuous improvement of global orthopedic treatment capabilities and the rapid development of orthopedic device technology, the global demand for orthopedic devices has continued to rise. As of 2022, the global orthopedic device market size has exceeded the 250 billion yuan mark.

Benefiting from the rapid increase in the global elderly population and the continuous advancement of the medical device industry, it is predicted that by 2028, the global orthopedic device market size will reach approximately 350 billion yuan, showing huge industry market potential. Recently, GlobalData forecasts that with the negative impact of the COVID-19 pandemic gradually receding, orthopedic surgeries will fully recover, and the entire orthopedic device market will reach nearly 50 billion US dollars (approximately 365.8 billion yuan).

Top 10 Global Rankings: On August 16, 2023, the medical device industry website Medical Design & Outsourcing released the latest global top 10 orthopedic device companies ranking. The rankings of the major orthopedic device companies have fluctuated with changes in the overall market conditions.

Source of the chart: Data from Medical Design & Outsourcing, Chart prepared by Innovative Medical Device Network

With the aggravation of population aging, the prevalence of orthopedic-related diseases such as osteoarthritis will continue to rise, further boosting the demand in the orthopedic market. Moreover, with advancements in technology and medical standards, orthopedic surgeries are trending towards minimally invasive and personalized procedures, increasing the demand for high-end orthopedic products, which brings significant growth potential to the orthopedic market.

In the latest global top 100 medical device companies, Henry Schein ranks 13th, but in its annual revenue of $12.6 billion in 2022, sales revenue in China accounted for less than 1.5%.

Henry Schein established Shanghai Henry Schein Trading Co., Ltd. on December 4, 2009, as a wholly foreign-owned enterprise invested by Henry Schein China Service Limited, mainly engaging in product sales related to the dental business. The main products of Shanghai Henry Schein fall into four major categories: Implantology, Infection Control, Endodontics, and Whitening. Meanwhile, affected by centralized procurement, the orthopedic market in China has brought significant changes to the domestic market landscape. Whether Henry Schein will further expand into other business areas in China remains an open question for the future.

In the Chinese orthopedic market in 2023, policies such as national bulk procurement will continue to influence the market landscape, and innovation and differentiation strategies of orthopedic medical device companies will become crucial. Additionally, with the rapid development of biopharmaceutical technology, biomaterials and 3D printing technology will emerge as industry highlights, profoundly impacting the development of the orthopedic market.

Henry Schein's Entry into the Orthopedic Field This Time May Be Driven by the Future Growth Potential of the Orthopedic Market.

Tom Popeck, President of Henry Schein Medical's Professional Group, stated: "We look forward to entering the extremities market through the complementary product portfolios of TriMed and Extremity Medical, which will expand our Brasseler Medical orthopedic cutting accessories and revision instrument solutions."The upper and lower limbs are one of the fastest-growing fields in orthopedics, with a potential total market exceeding $5.5 billion. We are confident in accelerating the global impact of TriMed and Extremity.”