Synthes is the leading manufacturer of metal implants but faces issues with implant removal. There is an opportunity in bioresorbable implants which dissolve over time eliminating removal. However, bioresorbables are an under-researched area with unproven products, which could damage Synthes' reputation. The document analyzes Synthes' options, including continuing with metal implants, waiting for competitors, or developing bioresorbables using current or researching new technology. It recommends Synthes pursue continued research and development of next generation bioresorbable polymers to remain innovative leaders in the field.

1. SYNTHES

2. Problem Statement
■ There might be a market for bioresorbable implants; Syntes must decide on its
feasibility and whether they should enter
■ The question posed is whether or not Synthes should invest in bioresorbable devices
■ If they do enter there might be implications with regards to faulty products because of
not enough research or lack of trust in the products laid by surgeons
■ How do they stick to their reputation of being innovators and core competency of
R&D

3. Situation analysis
■ Leading manufacturer of internal fixation devices used by over 80% orthopedic surgeons in
the US-its implants are considered ‘gold standard ‘
■ US market leader in metallic (stainless steel and titanium) trauma implants with $240
million in revenues in 2000 and over 300000 patients
■ Affiliated with the Association for the Study of Internal Fixation (AOTC), that has pioneered
development of trauma implants
■ Total implant sales across manufacturers were over $540 million with 5% growth rate
■ Metal implants necessitated removal after healing due to pain or other complications
■ Opportunity in Bioresorbable implants, which dissolved over time, eliminating need for
removal

4. Challenges faced
■ Implant removal can result in pain, infection or muscle and nerve damage
■ Threat of commoditization in metal implants category
■ Bioresorbable implants have the potential to replace metal implants
■ Competitors have been aggressively launching bioresorbable products
■ Synthes could lose market share in metal implants segment as Bioresorbables could be too
disruptive to their current strategy
■ Entering an under researched market with unproven products could tarnish Synthes’ strong
brand as the leader in product development
■ Conundrum between waiting for other manufacturers to develop new generation
technology or developing and marketing with currently available technology

5. MarketAnalysis
Material Used
Titanium Stainless Steel
Bioresorbable
material
6 Million fractures in the US 6000000
85% are simple & do
not require surgery 5100000
15% of them need
internal fixation
devices 900000
80% adults 720000 20% children 180000
20% needed
them removed 144000
40% needed
them removed 72000
• Synthes has a market share of 50% with 240 million sales of a 540 million+ industry.
• 24% of the patients need the device removed – could be first to try bioresorbable

6. Competitive EnvironmentJohnson&Johnson
• Leading maker
of Artificial
hips & knees
• Sale of $1
billion per year
• Orthosorb-
90% market
share - $2.6
million in
revenues
Biomet
• Present in all
segments
• $1 billion sales
• ReUnite line
made $1.6
million
BiomxandMacropore
• Trauma, sports
medicine
• $3.4 million
Smith&Nephew
• Potential
competitor as
it was the
second largest
player in the
orthopedic
trauma market

7. Porters 5 forces
Low
• Need to have a proven track record
• Trust factor for products
• Surgeons must approve
High
• Market in nascent stages
• Experimenting with consumers
• Need to build trust & confidence with surgeons
Data not available in case
• Ideally they should high bargaining power due
nature of industry
High
• Competitors exist
• Metal implants still being preferred
Bioresorbable implants

8. Alternatives
■ The main options available for the company are:
– To continue the same way, not enter bioresorbables, focusing on well established
competences (Metallic implants);
– To wait for other manufacturers to develop new generation technology (3rd
generation) and push it to the market.Just then, if room for success is present,
quickly enter the market;
– To develop and market a line of bioresorbables using the currently available
technology (2nd generation);
– To research and develop the next generation technology

9. SuggestedWay forward
■ Fourth option of continued research and development into 3rd generation polymers,
■ Synthes returns to their core competence of R&D
■ Synthes is known for innovation and wont be considered follower
■ Beneficial also for researchers and scientists who will get to work on new technology;
courses can be driven around this
■ Although the costs will be higher the rewards will be more as well
■ There is also the risk of their competitors developing these before them