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Stryker Acquires Ivy Sports Medicine to Strengthen Its Business

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Overview

On September 1, 2016, Stryker (SYK) announced the acquisition of Ivy Sports Medicine. It’s the latest acquisition by Stryker so far in 2016. The other acquisitions include Sage Products, Physio-Control, Synergetics, SafeWire, Stanmore Implants, and Becton Dickinson’s (BDX) Vertebral Augmentation Solutions Business. For more on these acquisitions and Stryker’s inorganic growth strategy in 2016, read Stryker Continues to Exhibit a Strong Inorganic Growth Strategy.

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Ivy Sports Medicine is a New Jersey–based healthcare company. It offers a comprehensive and minimally invasive product portfolio for meniscal repair. Its key product is the CMI (collagen meniscus implant). It’s the only FDA-approved CMI on the market. Ivy Sports Medicine was founded in 2011. It acquired ReGen Biologics soon after. ReGen Biologics developed the CMI implant—the FDA approved it in 2008.

According to Stryker, “The acquisition of Ivy Sports Medicine strengthens our capabilities and fits strategically with our current portfolio. Ivy’s complete meniscal platform, coupled with their clinical history, will allow us to provide our customers with multiple solutions to address meniscal repair.”

Market position and opportunities

According to Medscape, each year around 850,000 patients in the US undergo meniscus-related surgical procedures. It’s the most common type of knee injury. Stryker’s strong distribution network, sales channel, and highly complementary existing portfolio positions it well to gain more market share in the knee market in the US and around the world.

Medtronic (MDT) and Zimmer Biomet Holdings (ZBH) are some of the company’s major competitors in the orthopedics market. Investors can invest in the Health Care Select Sector SPDR Fund (XLV). Stryker accounts for ~1.3% of XLV’s total holdings

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