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FAVORABLE DEMOGRAPHICS
DRIVE THE MARKET
In 1999, over 90 million women between the ages of 15 and 64 recorded
more than 118 million visits to the Ob/Gyn. Over 70 million of these related
to gynecologic complaints [1] .
By 2010, the United States Census Bureau projects that the number of women
in this age group will grow by 12 percent. Over 40 million of these women
will be 45 to 64 years of age, as the 'baby boomers' – women born between
1946 and 1964 – begin to experience the gynecologic problems associated
with advancing age. By then, total patient visits to U.S. Ob/Gyns are
projected to reach 132 million.
VISITS TO
U.S OB/GYNS
REFLECT AN AGING
FEMALE POPULATION
Annual examinations, cancer screening, menstrual disorders, vaginitis,
and the management of menopause account for approximately two-thirds of
the patient visits to Ob/Gyns in the United States, with the rest for
pregnancy and reproductive management.
Office visits for pregnancy and reproductive management are, as expected,
by women between the ages of 15 – 44, while older patients 45 – 65 manifest
gynecologic concerns [1] . Consistent
with an aging population, visits for menstrual disorders and menopause
are growing, and osteoporosis (reduction in bone mass) has become one
of the most frequent diagnoses.
In 1999, nearly 5 million patient contacts to monitor and treat abnormal
Pap smears were reported, mostly in the 25 to 44-year age group [2]
. Follow-up visits include repeat Pap smears and colposcopic examination
(visualization of the cervix with a light source and microscope). Visits
for abnormal Pap smear have remained constant at about 4.5 percent of
the total visits for the past five years and are expected to remain at
this level.
Vaginitis (inflammation of vaginal tissue) represents about 4 percent
of the total visits with about 80 percent of these cases between the ages
of 15 and 44 [1] . Office visits include
assessment of the vaginal ecosystem and the identification of infectious
agents.
The Ob/Gyn also is the primary contact for fertility assessment and treatment.
These visits occur primarily in the 25 – 44 year age group and include
evaluation of ovulatory function, fallopian tube patency and the status
of the endometrium (the lining of the uterus).
| WHY WOMEN VISIT AN OB/GYN1 |
2 0 0 0 Estimate
|
1 9 9 9
|
1 9 9 5
|
 |
| Normal pregnancy |
22,486
|
22,594
|
21,806
|
| Contraceptive management |
12,305
|
12,061
|
10,894
|
| Gynecologic examination |
11,709
|
13,658
|
12,586
|
| Female climacteric (menopause) |
10,046
|
10,247
|
7,831
|
| Menstrual disorders |
5,391
|
5,230
|
3,847
|
| Abnormal Pap smear |
4,953
|
4,840
|
4,495
|
| Vaginitis |
4,431
|
4,398
|
4,450
|
| Surgery follow-up |
2,810
|
2,811
|
3,191
|
| Routine post-partum follow-up |
2,306
|
2,676
|
2,585
|
| Genital symptoms |
1,673
|
1,570
|
1,749
|
| Urinary tract infection |
1,059
|
1,185
|
1,141
|
| Absence of menstruation |
1,018
|
1,035
|
1,024
|
| Infertility screening |
970
|
833
|
980
|
| Osteoporosis |
770
|
541
|
0
|
| Other |
36,518
|
34,775
|
34,757
|
| Total visits |
118,445
|
118,454
|
111,336
|
1 Physician's Drug and Diagnostic Audit, January - December
1999. Philadelphia, Pa: Scott-Levin, Inc.
MOST FREQUENTLY
PERFORMED PROCEDURES
MIRROR AGING
TRENDS
Endometrial sampling is the Ob/Gyn's most frequently performed procedure,
often done in conjunction with the start of hormone replacement therapy
(HRT), and in the evaluation of menstrual disorders. As the population
continues to age, the incidence of menstrual disorders and the use of
HRT will also rise.
Hysterectomy (removal of the uterus), the second most frequently performed
major surgical procedure among reproductive age women after Cesarean delivery,
is widely performed for menstrual disorders. More than a fourth of American
women will have a hysterectomy performed by the time they are 60 years
old. Sometimes, the ovaries and the fallopian tubes are removed at the
same time. About three-quarters of these procedures are performed abdominally
and one-quarter vaginally. A small number are performed using a laparoscope,
a minimally invasive surgical instrument.
Hysteroscopy (evaluation of the uterus using an endoscope) and myomectomy
(removal of a uterine tumor) assess and correct abnormal uterine bleeding
or improve fertility. Diagnostic hysteroscopy is performed in the physician's
office or in an outpatient facility, to obtain biopsies and determine
the presence of tumors.
Tubal ligation, a sterilization procedure involving destruction or occlusion
of the fallopian tubes, is the third most frequently performed gynecologic
surgical procedure. It is often carried out during a Cesarean section
or following a vaginal delivery.
Most Common Medical Procedures in Ob/Gyn Practice,
19993
| Medical Procedure |
% OB/GYNs Currently Performing
|
|
| Endometrial sampling |
94
|
| Abdominal hysterectomy |
90
|
| Laparoscopy |
89
|
| Tubal ligation |
86
|
| Vaginal hysterectomy |
85
|
| Laparotomy |
84
|
| Pap smear |
|
| Manually read |
83
|
| Automated |
34
|
| Colposcopy imaging |
78
|
| Cryosurgery |
78
|
| Loop electrosurgical excision procedure (LEEP) |
76
|
| Hysteroscopy |
74
|
| Myomectomy |
72
|
| Gynecologic ultrasound |
69
|
| Infertility testing/treatment |
68
|
| OB ultrasound |
67
|
31999 Technology Study. Contemporary Ob/Gyn, 1999; 8-9.
TRENDS IN OB/GYN
PRACTICE PROFILES
In a 1996 review of practice profiles[ 5],
the American College of Obstetricians and Gynecologists reported that:
Nearly two-thirds of Ob/Gyns worked
exclusively in private practice, 13 percent worked in a private practice
and held a salaried position, and 23 percent held salaried positions only.
This reflects a significant shift toward managed care employment compared
with the College's 1991 report. More than half of private practice Ob/Gyns
worked in group practices, a significant increase from 1991. About 20
percent of these physicians practiced gynecology only.
Women comprised about 65 percent of residents, a significant demographic
change since the 1991 survey.
| |
Number of Procedures
|
|
| Hysterectomy |
591,000
|
| Ovary and fallopian tube removal |
475,000
|
| Bilateral destruction or occlusion of fallopian tubes |
342,000
|
| Repair of cystocele and rectocele |
151,000
|
| Dilation and curettage (D&C) of the uterus |
83,000
|
| Mastectomy |
89,000
|
4National Hospital Discharge Survey, Annual Summary,
1996. National Center for Health Statistics. Vital Health Statistics,
1998.
CONSOLIDATING
THE WOMEN'S HEALTHCARE
MARKET
While general medical practitioners play an important role in women's
primary healthcare, the Ob/Gyn is recognized as the reproductive health
specialist and is the predominant customer for associated medical devices.
Historically, many small medical device companies have supplied the women's
healthcare market with a wide range of products through a necessarily
fragmented distribution system. There are over 75 of these companies serving
the United States women's healthcare market today, reflecting the wide
scope of women's healthcare needs and the large number and varied types
of providers who meet them. There are nearly 31,000 Ob/Gyn's under the
age of 65 practicing at 16,100 locations in the United States, as well
as 6,000 hospitals with clinics, outpatient and surgical facilities, plus
300 fertility clinics specializing in assisted reproductive technologies.
Until recently, larger companies have not sensed an opportunity to build
a large, integrated women's healthcare business. This has allowed smaller
companies to target a single procedure or disease and develop a limited
product line to address either its diagnosis or treatment. Most of these
businesses have remained small and, as their growth slowed, many looked
to exit the market.
CSI's business strategy has been to selectively identify smaller companies
and product lines and acquire those that can improve its existing market
position or offer opportunities in new clinical areas.
Ob/Gyn Practice Settings6
| Practice Setting |
Number of Sites
|
|
| Ob-Gyn offices: |
|
| Solo practices |
7,928
|
| Group practices |
8,174
|
| Total offices |
16,102
|
| Hospitals |
6,000
|
| Fertility clinics |
300
|
6American Medical International Database, Los Angeles,
CA, October 2000.
Ob/Gyn Distribution By Age and Gender7
|
Age
|
Female
|
Percent of Total
|
Male
|
Percent of Total
|
|
|
Under 35
|
3,364
|
10
|
1,860
|
5
|
|
35 – 44
|
4,388
|
13
|
5,015
|
14
|
|
45 – 54
|
2,599
|
7
|
7,211
|
21
|
|
55 – 64
|
858
|
2
|
5,588
|
16
|
|
65+
|
271
|
1
|
3,968
|
11
|
|
All Ages
|
11,480
|
33
|
23,642
|
67
|
7Women's Health 2000, A Contemporary Ob/Gyn Fact Book.
Contemporary Ob/Gyn 2000; 30.
ACQUISITIONS WITH A CLINICAL FOCUS
CSI has historically concentrated on five high potential areas
in women's healthcare:
GYNECOLOGY:
medical and surgical management of gynecologic disorders
ONCOLOGY: medical
and surgical approaches to treat malignancies of the cervix, ovary,
uterus, and vulva
REPRODUCTIVE
ENDOCRINOLOGY AND FERTILITY:
reproductive biology including hormones and assisted reproductive
technologies
OFFICE
PRACTICE:
diagnostic evaluations within primary and preventive care
OBSTETRICS: evaluation
and monitoring of a pregnant woman and her fetus.
Most of the medical device usage comes from the first three categories,
as does CSI's revenue.
Since the early '90s, CSI has developed a business model that surrounds
Ob/Gyns with premium medical devices for their highest volume procedures.
Over the past six years, CSI has acquired or licensed 11 major companies
or product lines.
CSI achieves financial benefit from its acquisitions by rapidly integrating
technologies and manufacturing functions to improve profitability. Using
this approach, CSI gross margin currently approaches 55 percent, the high
end of the medical device industry average.
1 Physician's Drug and Diagnostic
Audit, January – December 1999. Philadelphia, Pa: Scott-Levin, Inc.
2 Women's Health 2000, A Contemporary Ob/Gyn Fact Book. Contemporary Ob/Gyn
2000; 67-68.
5 ACOG Economic Impact Study: Profile of Ob/Gyn Practices,
1991-1994: Washington, American College of Obstetrics and Gynecology,
1996.
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