The global orthopedic implants market, valued at about $20 billion in 2023, is expected to grow at a compound annual growth rate of 4.8%, reaching about $26.5 billion by 2029.¹

Technology advances (e.g., software, additive manufacturing, automation, optical measurement systems, Internet of Things, artificial intelligence), new or expanding markets, and a more active senior population are contributing factors to the steady growth of the orthopedic implant market. 

Despite these positive indicators, pricing continues to be a key concern for implant manufacturers. 

“What we are seeing is that while parts are becoming increasingly complex, pricing has not risen to match that,” said Savannah Smucker, vice president of operations for Spitrex MDI, a Lancaster, Pa.-based precision medical device contract manufacturer. “As a contract manufacturer, we have doubled down on driving efficiencies throughout our operations in order to stay competitive and deliver the value our customers expect.”

Trisha Mowry, CEO of Metal Craft | Riverside Machine & Engineering, an Eau Claire, Wis.-based contract medical device manufacturer, agreed.

“Orthopedic companies are increasingly focused on driving cost out of implant and instrument manufacturing,” she said. “However, this cost-reduction imperative is also occurring alongside a rise in regulatory requirements, which present challenges to not just medical device manufacturers, but also their manufacturing partners. These regulations, while essential for ensuring quality and safety, often lead to extended lead times and increased costs across the board.” 

As implants become increasingly complex, the integration of manufacturing with inspection processes is essential. “Real-time or concurrent inspection during manufacturing reduces rework, improves quality control, and significantly shortens production lead times,” said Mowry. 

Coordinate measuring machines (CMM), CT (computed tomography) scanning, and other optical scanning methods are typically needed to measure the tight tolerances required by implant designers. This sophisticated testing equipment provides the ability to scan a part and segment it at infinite angles to find defects such as cracks, porosity, trapped powder, and dimensional non-conformance, without the need for destructive testing.

“Integrating inspection with manufacturing processes,” continued Mowry, “ensures higher consistency in final products, while also controlling costs.”

Current Trends

Implant manufacturing is entering a new era “where speed to market and integrated design-to-launch solutions are no longer a luxury—they are a necessity,” said Jeff Tyber, founder of Tyber Medical and now president of the CDMO (contract development and manufacturing organization) business for the newly combined entity of Intech, Tyber, and Resolve Surgical Technologies, which have merged into a unified developer, designer, and manufacturer of surgical devices. “Whether it is a startup needing a nimble CDMO partner or an MDM [medical device manufacturer] searching for a pre-validated implant platform, the pressure is the same—deliver better outcomes, faster, and at lower risk.”

Much of the innovation in the orthopedic implants market is the result of advancements in engineered materials. Implant companies are striving to develop lighter-weight implants that match—or even exceed—the strength of their heavier metal counterparts. This often requires extensive testing of new materials for not only enhanced strength and biocompatibility, but also improved elasticity and resistance to fracture. 

“The goal is to create implants that perform better and improve patient safety and comfort,” said Mowry. “Working with these new materials involves skilled machinists willing to experiment and partner with our customers to define new best practices. New materials are being developed in other industries [e.g., aviation, aerospace, and defense] that share the needs of the medical device market. Getting these materials tested and approved in today’s regulatory market does slow down time to market, but once approved, can create a competitive edge in the marketplace.”

Paramount to maintaining this competitive edge is automation, which is rapidly advancing due to software improvements. As implant and device designs grow more complex, and quality standards remain as demanding as ever, contract manufacturers (CMs) are still expected to deliver within tight timelines—typically eight to 10 weeks. Automation has become essential, not just for speed to market and meeting deadlines, but also for maintaining quality and staying competitive on cost.

“While automation in machining has been around for years, we are seeing a significant rise in the use of automated inspection technologies,” said Smucker. “Today, automation for both manufacturing and inspection is not just an advantage—it’s a necessity in the world of implant manufacturing.”

In the realm of the Internet of Things (IoT), “one of biggest changes we are seeing is the way surgical robotics are shaping implant designs and the growth of cementless options that provide more immediate stability as compared to cemented options,” said Shawn Schafer, vice president of business operations for Oberg Medical, a Pittsburgh, Pa.-based medical device manufacturer that provides metal and plastic implants, instruments, and complex assemblies.

“There is also a strong trend toward 3D printing of medical devices, as well as the use of nanotechnologies in the coating of implants,” added David Cabral, president and CEO of Five Star Companies, a New Bedford, Mass.-based contract manufacturer of medical devices and implants. Additive manufacturing (AM) enables the creation of complex shapes that were impossible to make in the past using conventional machining methods. AM-made structures and components can be fabricated from an ever-growing variety of materials, including metals, plastics, and even living cells. Other AM benefits include customization of shapes, fewer assembly steps, less material waste, and making “just-in-time” manufacturing a more viable process. Advancements in AM software—particularly for design optimization and simulation—continue to expand AI capabilities. 

“Although the costs of AM can be expensive, the design flexibility provides surgeons and patients with more options as compared to traditional cast implants,” said Schafer.

What MDMs Want 

Tyber sees an increasing demand for turnkey, regulatory-ready solutions that significantly reduce development time, essentially letting MDMs leapfrog the traditional R&D cycle. “At the same time,” he said, “design for manufacturability and rapid prototyping remain critical for customers still building their own IP from the ground up.”

To remain competitive and compliant, orthopedic companies are looking for innovative partners that can help reduce the impact of development and production challenges. The priority is to accelerate new product development while minimizing labor and overall cost, which requires collaboration, agility, and a forward-thinking approach to both manufacturing and design processes. “Partnering early in the design process often optimizes and improves the production process for both the MDMs and their contract manufacturers,” said Mowry. “Our goal is to streamline this process and identify ways to add in automated systems to capture data, share data, and shorten the process to repeatable products.” 

What is the most common ask from orthopedic device companies? Speed without compromise. “Companies want a manufacturing partner that can design, validate, and scale,” said Tyber. “On top of that, flexibility, risk-sharing, and global capacity are now all table stakes, which is what led to Tyber joining forces with Intech.”

John Ruggieri, senior vice president of business development for ARCH Medical Solutions, a Bloomfield Hills, Mich.-based medical device contract manufacturer that provides additive manufacturing, precision machining, validated processes, and related supply chain integration, agreed.

“Customers are looking for faster turnaround and agile manufacturing,” he said. “MDMs want partners that can rapidly iterate prototypes, scale to production quickly, and adapt to design changes without disrupting timelines. Responsive project management, detailed quoting process to identify cost drivers, and real-time updates are increasingly valued.”

Perhaps most important to MDMs is reliability of supply—the ability to scale quickly, perfect quality, and on-time delivery metrics. “Cost control will always be front and center from the MDM perspective—however, while competitive pricing is necessary, the ability to mitigate risk in terms of supply and quality will drive decision making,” said Schafer.

Technology, Tools, Solutions

MDMs are always on the hunt for new ways to enhance production, throughput, and efficiency, which makes for happier customers and faster speed to market. When combined, these improvements—ranging from changing a workflow pattern on the shop floor to digital real-time metrics to buying the latest equipment—can have a big impact on overall cost reduction and performance metrics. 

“Five Star Companies is always reviewing our processes and methods to identify opportunities to improve upon costs and delivery,” said Cabral. “This includes our tooling, fixturing, setups, and overall process efficiencies. Our latest machine purchases have wireless capabilities for program data transfer, optical monitoring, and tool failure technologies.”

These features are needed for lights-out manufacturing—the ultimate setup for speed and reduced production costs. This process relies on automation and robotics to operate with minimal or no human intervention. Achieving this level of “dark factory” performance requires the integration of IoT-based technologies with configurable machines and conveyor belts, vision systems, and advanced process control software. Lights-out manufacturing is not always easy to achieve; however, when it is used successfully, it reduces labor costs and maximizes production efficiency. 

For some non-metal components, machining must be done without coolant or other contaminants. Due to the expansion/contraction properties of certain materials, some products must be machined out of tolerance to compensate for heating/cooling characteristics. For example, the material that Five Star Companies machines for shoulder implants is ultra-high molecular weight polyethylene (UHMWPE), an implantable-grade polymer. During the machining process, coolants and other fluids cannot make contact with the material. As a solution, “our engineers developed a process utilizing cold air (<32°F), which results in the material contracting in size,” said Cabral. “After the machining process, as the parts warm to room temperature, the material returns to its original state as it moves into dimensional and tolerance specifications as per the drawing/blueprint. It sounds strange, but this approach works and is based on our team’s extensive experience with these materials.”

Forward-thinking orthopedic implant manufacturers are integrating AI into the design and development of their products. For example, large amounts of patient data, including imaging, can be analyzed with AI to improve the fit and performance of personalized implants. Material databases can be quickly searched to find the best implant materials for a variety of applications, including new biocompatible materials that enhance osseointegration. “AI-powered simulations can virtually test hundreds of implant designs under various stress conditions, allowing for rapid optimization and reducing the need for physical prototypes,” stated Madison Ortho, a supplier of orthopedic products.² “AI algorithms can analyze data from existing implants to identify potential weak points and predict failure risks. This information can be used to refine future implant designs and improve their overall longevity.”

Smucker has noticed over the past year that orthopedic device companies are more open to engaging in design for manufacturability (DFM) discussions with their CMs. Although many implant engineers have a solid understanding of machining fundamentals, it is the CM that deeply understands the practical boundaries and capabilities of the processes involved. 

“Engaging your manufacturing partners as early as the prototype phase can provide invaluable feedback on the design, help align with pricing targets, and open the door to considering alternative materials or finishes—all before major, costly commitments are made,” said Smucker. “Most importantly, it sets the stage for a smoother product launch. With early involvement, the manufacturer has time to validate processes, dial in cycle times and lead times, and reduce surprises. We’ve seen plenty of so-called ‘production-ready’ projects that still required significant learning before they were truly ready for production.” 

VMI—vendor management inventory—is another growing trend. VMI is an inventory management approach in which a vendor (typically a CM) manages and maintains the inventory for the client. The CM makes all inventory-related decisions and maintains appropriate inventory levels for its manufacturing processes. This way, the vendor is responsible for minimizing the MDM’s inventory stockout and overstocking risks. This is achieved using inventory management software that allows the CM to set stock thresholds and monitor inventory levels.

“We have invested in smart, integrated systems across the group that use VMI to support robust sales and operation planning [S&OP] partnerships with our OEM customers,” said Tyber. “By linking our S&OP processes with theirs, we are able to deliver repeatable, on-time solutions, making it easier to plan, scale, and ensure product availability exactly when it is needed.”

Barriers to Innovation

Although press releases regularly announce innovative advances in the orthopedic industry, significant barriers do exist for device companies that slow down their innovative efforts or divert their focus and funding. These include fragmented or irregular supply chains, fear of regulatory delays (especially for new materials), longer time to market, and lack of standardization for internal new product introductions. On the positive side, the impacts of these barriers can be lessened through vertical integration, which speeds up DFM, consolidates the supply chain, improves communication and decision making, and shortens time to market. 

Bullying their way to the forefront of the global economy are the Trump administration tariffs, which have created considerable uncertainty within the medical device industry. Although nothing has been finalized regarding costs, national intellectual property and technology law firm Knobbe Martens indicated that “Johnson & Johnson anticipates a $400 million tariff ‘headwind’ on its medical tech division.”³

As of April 25, the U.S. had imposed tariffs on more than 180 countries and territories. Electronic medical devices may also be impacted by semiconductor tariffs. Knobbe Martens further reported that over half of all medical devices depend on semiconductors to operate and “over 90% of the world’s most advanced chips are manufactured in Taiwan—which had a 32% tariff applied on all goods exported to the U.S.³ Tariffs could also disrupt supply chains by creating uncertainty and delays, especially if other countries retaliate. Tariffs also pose a serious scale risk to startup medical technology firms or smaller to mid-size MDMs—all of which could discourage long-term investments in medtech.” 

As tariff rates continue to evolve, it is essential U.S. companies assess the impact of these trade policies on their business operations and supply chains. MDMs are already thinking about switching production to lower-tariff countries. “They should assess the pre-/post-impact of the tariffs on earnings per share and overall shareholder returns,” stated business advisory firm PwC.⁴ “It is crucial for companies to model the changes to have data-driven insights that inform strategic decisions moving forward. The medical device industry could consider refreshing their operational strategy, including potential changes to a company’s overall supply chains, alternative materials sourcing strategies, manufacturing and intangible property (IP) locations, as well as alternative logistics solutions.” Another mitigation technique is tariff engineering, which involves making slight adjustments to products that would qualify them for a lower tariff rate. This can involve changing materials, altering manufacturing processes, or even redesigning the product to fit a different classification.

Another disrupter to innovation is acquisitions. “Many of our customers are undergoing acquisitions and mergers, which poses a whole new set of challenges,” said Smucker. “It seems like everywhere we turn, a new announcement of an acquisition surfaces. While this can be positive for manufacturers that were working with the companies before, there are still many hoops we have to jump through with being added to approved supplier lists, validating our manufacturing of the parts we make for the new entity, and restarting our relationship with sometimes a completely new team of buyers, engineers, and quality personnel.”

Sometimes it is the unnecessary complexity of a design that holds up the process because it is too innovative, or has not gone through DFM. Even then, the real innovation is often the adjustments CMs can make that reduce the complexity—speeding up approval and getting products into the market faster.

Customers often approach Spitrex MDI with parts they assume require special operations or need to be outsourced. “But in reality,” said Smucker, “with the right equipment, tools, and mindset, there are very few challenges we can’t tackle in-house. Our machinists take the time to fully analyze each part and often find alternative ways to machine it, using our existing capabilities. By thinking creatively and pushing the limits of what is possible, our team has eliminated the need for processes like sinker electro discharge machining, gun drilling, and more—saving both time and cost for our customers.”

Moving Forward

The future of implant manufacturing belongs to companies that can act like an extension of their customers’ R&D, operations, and regulatory teams. “That’s our vision—whether a customer needs a one-off prototype or a global implant platform,” said Tyber. “That is why we have integrated vertically, invested in regulatory leadership, and created pre-cleared platforms to make innovation smoother, not harder.”

MDMs are also embracing sustainability—not just to conserve natural resources, but also to be a key differentiator in the marketplace. “More progressive and socially responsive MDMs want suppliers that share their visions on sustainability without compromising cost efficiency,” said Ruggieri. “There is a push for leaner, more sustainable manufacturing methods—less waste, more automation, better material utilization. It is extremely important that we stay ahead of the curve with the many facilities that make up our total industrial footprint.”

“Ultimately, MDMs are seeking innovation that balances performance, cost efficiency, regulatory compliance, sustainability, and speed to market,” noted Mowry. “Manufacturers who can align with this vision will be the ones who lead the next wave of innovation in the medical device industry.”

References

¹ tinyurl.com/odt250561
² tinyurl.com/odt250562
³ tinyurl.com/odt250563
⁴ tinyurl.com/odt250564

Mark Crawford is a full-time freelance business and marketing/communications writer based in Corrales, N.M. His clients range from startups to global manufacturing leaders. He has written for MPO and ODT magazines for more than 15 years and is the author of five books.