"Back" to the Future: The Vertebral Compression Fracture Market Part 1

Welcome to the “spine machine.” Please fasten your safety belts. Make sure your seats are in the full, upright position. It’s time to travel to the next market in spine. So hold on to your vertebrae, because the future is waiting.

The rapidly evolving orthopedics market has no greater star with respect to innovation than spine. The complex biomechanics of the spine are cause for both intrigue and frustration for bioengineers. The two broad themes at NASS this year were motion preservation technologies and minimally invasive surgery. However, the spine machine suggests another destination. The vertebral compression fracture (VCF) market is on the move.

Osteoporosis and Vertebral compression fractures: “And In Today Already Walks Tomorrow”

The vertebral compression fracture market in the United States represents a significant opportunity for medical device companies, and osteoporosis is the “invisible hand” that leads to the majority of fragility fractures. According to the National Osteoporosis Foundation, 30% of women aged 60–70 have osteoporosis. This number rises to 60% in women over 80 years of age. In the United States, 10 million individuals are estimated to have osteoporosis and almost 34 million Americans are estimated to have low bone mass, which places them at risk. Eighty percent of osteoporosis diagnoses are seen in women.

Chart 1 displays PearlDiver data, which relates to diagnoses of the various types of osteoporosis in the non-Medicare population. This is a window into the future! Generalized osteoporosis comprises about 75% of the diagnoses. This is followed by senile or postmenopausal osteoporosis, comprising 17% of the diagnoses. It should be noted that PearlDiver data is representative of the under 65 population. Senile osteoporosis accelerates after menopause in women, and a significant percentage of diagnoses occur after age 65. According to the Department of Health and Human Services’ national data, 84% of generalized osteoporosis is diagnosed in patients 65 and older, while 92% of senile osteoporosis is diagnosed in patients 65 and older.

Chart 2 shows the steep decline in bone mineral density (BMD) in women over 50 years of age. Why does the spine machine travel to osteoporosis first? One out of every two women and one in four men over 50 will have an osteoporosis-related fracture in their lifetime. In short, 85% of VCFs are related to osteoporosis.

Chart 1: Osteoporosis Diagnoses Under 65 Years of Age

Source: PearlDiver Patient Records Database (2004-2006)

Chart 2: Loss of Bone Density in Women

*Source: http://www.merck.com/mmhe/sec05/ch060/ch060a.html

VCF Demographics: The numbers

Seventy-five percent of VCFs in the U.S. occur in women. This is in part because it is females that are predominately affected by osteoporosis. As noted above, over 80% of VCFs are seen in patients 65 and older. And of this group, women make up 77% of the diagnoses. VCFs affect about 25% of all postmenopausal women. The condition is prevalent in 40% of women over 80 years of age.

However, the market is not as simple as the statistics show. Over the age of 50, women are more likely than men to suffer a VCF. But, according to PearlDiver data, which zeros in on patients 65 and under, VCFs are more prevalent in men under 50 than they are in women under 50. Trauma-related VCFs, which occur more often in men, could explain this prevalence. Chart 3 illustrates a demographic shift that we call the “osteo-shift.” This is in part due to the relationship between osteoporosis and compression fractures. It can be seen that men actually have more thoracic compression fractures than women until the age of 50. Interestingly, this is the age at which the steep decline in bone mineral density begins in women.

Chart 3: Gender Shift in Thoracic Compression Fractures

*Source: PearlDiver Patient Records Database (2004-2006)

“Time keeps on slippin’, into the future….” Going forward, VCFs will persist given strong demographics and an aging population. In Chart 3 above, we see that women are predominately diagnosed with VCFs in the 50–64age groups. As can be seen in Table 1 below, by 2020, 30% of the population will be over the age of 55.

Table 1: Aging U.S. Population

Vertebral Compression fractures: a global health Problem

Osteoporosis is believed to account for up to 85% of VCFs. According to the National Osteoporosis Foundation, there are an estimated 1.5 million osteoporosis-related compression fractures each year in the United States, 700,000 of which are vertebral compression fractures. Of the 700,000 VCFs, it is estimated that only a third are diagnosed. In part, this is because fractures can be asymptomatic. Also, fractures are often missed on X-rays. Furthermore, mortality may be increased as much as 30% in patients with osteoporatic fractures. Chart 4 illustrates that while spine is the clear leader with respect to osteoporosis-related compression fractures, hip and wrist also make up a sizable market.

Chart 4: Osteoporosis-Related Fragility Fractures

*Source: National Osteoporosis Foundation

Vertebral compression fractures are a worldwide problem. There are an estimated 700,000 annually in the United States, 500,000 in Japan, and 350,000 in Europe. Indeed, Kyphon (acquired by Medtronic) has been eyeing the Japanese market for its flagship procedure, Kyphoplasty, intended to treat VCFs.

Chart 5: Estimated VCF Procedures Worldwide
 
*Source: Wall Street estimates

The economic costs of fragility fractures are immense. According to the National Osteoporosis Foundation, as of 1995, hospital and nursing home expenditures relating to the condition in the United States were greater than $13.8 billion annually, or $38 million a day. The projected cost for 2030 is $60 billion annually. In the UK the annual cost is projected to be £2 billion by 2020, and in Germany the projection is €500 million. Given the costs, the world should have an interest in this problem. According to the International Osteoporosis Foundation, 20%–25% of women over 50 have one or more

VCFs, and 20% of women who have a VCF are estimated to suffer from another within a year. These statistics hold for Australia, Denmark, and Sweden.

The door has opened in the VCF market and companies should be rushing in to get a footprint. Osteoporosis and an aging population will drive this market on global basis. Women are the primary target, while men also represent a sizable opportunity. Perhaps the most interesting point about vertebral compression fractures is that they are remarkably under-diagnosed.