Finsbury's Last Stand

Article preview reprinted from IN VIVO -  January/February, 2010

One of the most innovative and creative orthopedic implant designers, the UK's Finsbury's Orthopedics never quite built the sales and distribution capability to enable it to capture the full value of its designs. The company's recent sale to DePuy underscores how much the orthopedics industry has changed since its earliest days. Read more...

Finsbury's Last Stand

Article preview reprinted from IN VIVO -  January/February, 2010

Recently acquired by DePuy, the UK's Finsbury Orthopaedics recalls the earliest days of the orthopedics industry—and, more importantly, how much has changed.

by David Cassak

** Through the 1980s and 1990s, Finsbury Orthopaedics earned a reputation as a design and manufacturing operation par excellence, providing OEM services to some manufacturers and leaving the sales and distribution of its devices to others.

** The company played a key role in the launch and success of two other UK orthopedics companies, Corin and MMT, though both would prove to be frustrating and disappointing experiences.

**Finsbury scored some big hits over the years—for example, helping make real the renaissance in re-surfacing of a couple of years ago—but the failure to build its own sales and marketing effort ultimately created an unsustainable situation.

** Finsbury's sale last December to DePuy Orthopaedics underscores not just the importance of critical mass and distribution in today's total joint market, but how much the industry has changed over the past decade.

In many respects, the orthopedics industry, and in particular the joint replacement part of it, seems like a profoundly conservative industry. Success rates for existing devices are extremely high, leaving few major unmet clinical needs and fostering an "if-it-ain't-broke, don't-fix-it" attitude. Thus, technological enhancements come incrementally, focusing on materials and such, but leaving base design characteristics untouched. Real technology breakthroughs are rare.

Such a dynamic fosters a view of the industry as somewhat static, with long-cherished skills and values still relevant after many years. But in very profound ways, the orthopedics industry has changed from its early days. Early implant design rested on finely crafted designs developed in close collaboration with high-volume surgeons. Today, the market is driven much more by high-volume production of basic design concepts, valuing ease-of-implant to broaden a device's appeal.

Few companies embody and reflect those changes like the UK's Finsbury Orthopaedics Ltd. Long one of the most skilled design and manufacturing shops, the company regularly turned out innovative implants, but struggled to create the kind of high-volume sales and distribution capability that is a hallmark of the industry's giants. The company helped enable the recent renaissance in re-surfacing but was frustrated in a number of business collaborations and, more importantly, ultimately never built its own focused distribution network. The company's sale last December to DePuy Orthopaedics Inc., a Johnson & Johnson operating company, was, on the one hand, an affirmation of the company's design and development skills, but, on the other hand, it also was a strong indication that the company's business model had, in the end, become unsustainable.

A Biomechanics Lab

Unlike many technology sectors, orthopedic implants has a (relatively) long history, dating back to the 1960s and '70s, and to explore the early days of Finsbury Orthopaedics is to re-visit the industry's earliest days. In the early 1970s, Mike Tuke, Finsbury's CEO, was an engineering apprentice at Imperial College London. In those days, Tuke recalls, engineers actually made things. "It was very hammer and tongs," he recalls. "What I was learning was real engineering."

For a while, Tuke bounced around from department to department at the college, helping different professors realize their ideas by supplying the engineering expertise to turn our projects. "I could help them invent what they wanted to do because I could actually make things," he says. "They would dream up the craziest things, but they often had no idea how to put them into practice."

Within a couple of years, Tuke was invited to end his peripatetic ways and join a newly formed department at the college as a full-time engineer. Within the mechanical engineering department, a surgeon and an engineer, Michael Freeman, MD, and Alan Swanson, respectively, had established what Tuke says was one of the first biomechanical laboratories. "The idea was to study the properties of bone and cartilage because very little was understood at the time about the mechanical elements of those materials." Physicians looked at things like arthritis or bone loss and didn't really know what lay behind either or why cartilage would disappear in one patient and not another. "There were some very basic questions in those days and very little understanding of how joints worked or what different materials would do," he says.

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Companies mentioned in this article

Biomet Inc.

CeramTec AG

Corin Group PLC

Finsbury Orthopaedics Ltd.

Imperial College London

Johnson & Johnson

DePuy Orthopaedics Inc.

Smith & Nephew PLC

Stryker Corp.

Stryker Orthopedics

Zimmer Holdings Inc.

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