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Zimmer Knee's Feminine Twist

Melissa Davis

Or they seem to after total knee replacements, at least. So, Zimmer has now rolled out a high-end knee tailored specifically for women.

Knee replacements boast high success rates among both men and women already. But "this is not marketing hype," insists Zimmer CEO Ray Elliott. "This is some great science."

Zimmer's new "Gender Solutions" knee hits the market at a particularly crucial time, as device makers struggle to secure price increases for their traditional orthopedic implants and remain short on breakthrough technologies that could reshape the industry.

Like drug manufacturers before them, orthopedic device makers have been scrambling for new ways to grow -- and attracting some criticism in the process. The companies have been accused of developing new devices that seem like gimmicks at best -- and health threats at worst -- as they seek to reignite their once highflying stocks.

Of course, Zimmer has come under fire already. Just a few years ago, the company started promoting a new minimally invasive hip-replacement surgery that led to failures and never really took off.

Today, TheStreet.com offers up a three-part series that takes a closer look at some of the industry's latest offerings.

New Trend

Robert Booth, a prominent orthopedic surgeon who helped develop Zimmer's new device, foresees the beginning of a trend.

"Women can wear men's clothing and shoes, but most prefer clothing and shoes made for them," Booth observes. "That's because women are shaped differently than men. It's the same with knees, and it makes perfect sense to design knee implants with women in mind -- particularly considering that women are by far the majority of the knee-replacement patient population."

Zimmer will begin reaching out to those women soon through direct-to-consumer advertising. Ultimately, the company hopes to lure more women into the operating room -- including many who have resisted knee-replacement surgery so far -- with promises of better outcomes in the end.

Of course, Zimmer could use a new success story right now. The device maker, which relies on orthopedic implant sales more than most, has seen its stock punished over the past year as prices for its core products continue to come under pressure. The company is now banking on new products like Gender Solutions to accelerate sales and enable it to hit its aggressive full-year targets.

Zimmer can sell Gender Solutions at a premium because it ranks as a new technology using the company's expensive "high-flex" knee system. But some critics seem to wonder whether the company -- and those that follow it -- should be going down that path at all.

"It is unclear how much traction they will get from these products," writes Leerink Swann analyst Jason Wittes, who has a market-perform rating on Zimmer's stock. "But given the feedback thus far, we do question whether the orthopedic companies are going too far in promoting products with obvious marketing appeal but little clinical backing."

Sparking a Debate

Already, Zimmer has managed to spark a debate.

First -- a week before Gender Solutions' scheduled debut -- a Zimmer competitor suddenly declared that it had invented the first female-oriented knee. Stryker (SYK Quote) pointed to its Triathlon knee system, implanted in men and women alike, as proof.

Zimmer took the move as a compliment. After all, the company felt, Stryker had started promoting female knees even if it lacked a specially tailored one like Zimmer's own.

DePuy, which runs the orthopedics division of Johnson & Johnson , claims that the company offers a superior female knee as well. The company highlights its rotating-platform technology -- behind the only mobile-bearing knees in the U.S. market -- as "a true innovation in 'knees for women.'"

Even Biomet , whose recently departed CEO always shunned the marketing game, now claims to sell an ideal female knee. The company simply points to its flagship Vanguard system as the choice implant for both sexes.

"A lot of the things being touted about the female knee are things we introduced in 2004 with Vanguard," Bill Kolter, president of Biomet Orthopedics, told TheStreet.com last week. "I can't say that Zimmer is making bad changes because they are mimicking changes we made a couple of years ago. They're just a little later to the game."

Looking in the Mirror

Clearly, Zimmer sees itself as the trendsetter here instead.

Sheryl Conley, chief marketing officer for the company, admits that some competing systems -- such as Triathlon and Vanguard -- share advances with Gender Solutions. However, she says, they lack a major gender-related improvement.

Notably, she says, those systems failed to adjust the thickness of the implant front that causes women so much pain. Zimmer alone has done so, she adds.

Zimmer spent five years conducting research before the company rolled out its own gender-specific knee. As a result, the company plans to arm itself with reams of scientific evidence as it heads out to sell its product.

"There are 1,000-and-some pages of science," Elliott boasted at a recent investor conference. "There's just nothing else in there. ... It's going to be fun going out and selling against our competitors who assume this is Zimmer marketing."

In the meantime, Zimmer has started ribbing the competition already.

"Zimmer measures potential new product success by the level and intensity of insults from competitors," Elliott said during the company's latest quarterly conference call. "Gender Solutions is right up there with highly cross-linked (polyethylene) in 1998, high-flexion knees in 2000, MIS [minimally invasive surgery] hips in 2001 and MIS knees in 2004."

Leading the Cause

Zimmer led the push for MIS joint replacements as well.

But Zimmer's breakthrough surgery technique -- the two-incision hip replacement -- proved too challenging for widespread adoption and, therefore, fell short of the company's revolutionary aims. Today, only 6% to 7% of surgeons who use Zimmer implants rely on the complicated procedure.

To be fair, most Zimmer surgeons have wound up adopting other company-sponsored MIS procedures instead. But critics still question the soundness of MIS joint replacements, due to possible complications, and even Zimmer's focus on that particular niche.

After all, they note, Zimmer has basically spent a whole lot of money training surgeons to use the same old devices in a different way.

"All of these things -- MIS, computer-assisted surgery, gender-specific knees, etc. -- are costly extensions for Zimmer and the others," says a former sales manager who has marketed orthopedic devices for several major players in the past. But "none of these products are actually changing market share. It's just a big 'keep up with the Joneses' game that is costing these companies more money and slowing down the process of replacing joints."

Still, Zimmer clearly feels otherwise.

"We devote huge energy to innovative game-breakers -- whether it's MIS or Gender Solutions or high-flexion -- and we focus a lot of dollars there," Elliott admitted last month. "We're having a lot of fun with (Gender Solutions), and there actually is some great science to it. ... It will make for some unique debate in case anybody was getting bored listening to orthopedics."