Abstract
Introduction
Innovations in orthopaedic technology and infrastructure growth often require significant funding. Although an increasing trend has been observed for third-party investments into medical startups and physician practices, no study has examined the role of this funding in orthopaedics, including the influence of venture capital (VC). Therefore, this study analyzed trends in VC investments related to the field of orthopaedic surgery, as well as the characteristics of companies receiving said investments.
Methods
Venture capital investments into orthopaedic-related businesses were reviewed from 2000–2019 using Capital IQ, a proprietary market intelligence platform documenting financial transactions. The dataset was initially filtered to include healthcare-related venture capital transactions pertaining to the field of orthopaedic surgery. The final list of VC investments and their corresponding businesses were categorized by transaction year, amount (in USD), and orthopaedic subspecialty. The number and sum of VC investments was calculated both annually and cumulatively across the entire study period. Linear regression was used for trend analysis within two distinct, decade-long timeframes (2000–2009 and 2010–2019) and one-way analysis of variance was used to assess differences across orthopaedic subspecialties.
Results
Over the course of two decades, 672 VC investments were made into orthopaedic-related businesses, representing a total of $3.5 billion. Both the number and dollar value of transactions were greater in the second decade (2010–19) (233, $1.9 billion), compared to the first decade (439, $1.6 billion). Linear regression revealed significant trends in both the quantity and dollar amount of VC transactions within the decade from 2000–09 (p = 0.0002 and p = 0.0143, respectively) but no such trend in the latter decade (Figure 1A-B, Figure 2A-B). Throughout both decades studied, the largest and most frequent VC investments took place within Spine and Adult Reconstruction (Figure 3). One-way analysis of variance revealed significant differences in the annual frequency and amount of investment across orthopaedic subspecialties (p < 0.001 and p < 0.001, respectively).
Discussion and Conclusion
The present data suggest that an initially rising trend in VC investment in orthopaedic-related businesses may have plateaued over the past decade. These findings may have important implications for continued investment into orthopaedic innovations and collaboration between the surgical community and private sector, as well as the perceived profitability of orthopaedic industries by third-party interests.
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