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ePaper created 2014-11-23, 21:56:20 | version 1.30.01
I economy _In 2013, the global dental implant market— composed of the sale of dental implant fixtures, final abutments and other devices—was valued at over US$3.7billion.TheEuropeanmarket,valuedatnearly one-third of the global market at close to US$1.2 bil- lion,contractedthrough2014,asuncertaineconomic conditions continued to reduce procedure volumes and as more low-cost competitors entered the mar- ket, driving down prices. These factors hampered the expected economic recovery and resumption of growth projected for 2013. Asaresult,thedentalimplantmarketwillcon- tinue its decline before stabilising in 2015. Only then willtheEuropeanmarketslowlybegintorecover.Fac- tors such as low gross domestic product growth and high unemployment continue to render dental im- plant procedures—which are primarily paid out of pocket by patients—cost prohibitive, while alterna- tives,suchasbridgesanddentures,thatareperceived as more affordable will represent attractive options. _Straumann’s strategy DentalimplantswereinventedinSweden;asare- sult, it is not surprising that a great number of pre- mium manufacturers are based in Continental Eu- rope. In the past, premium manufacturers, such as Straumann and DENTSPLY Implants, were able to rely ontheirlong-standingreputationsinthemarketand thehighqualityoftheirproductstocommandhigher prices than did some of their competitors. More recently, however, some of the premium competitors have employed strategies to appeal to increasinglycost-consciousconsumers.Forinstance, Straumann has reduced the price of its titanium im- plants by 15 per cent in Austria, Germany and Switzerland. While the price change only came into effectinthefirstquarterofthisyear,thestrategyap- pearstohavebeeneffectivebecausethecompanyre- portedasixpercentriseinfirst-quarterrevenuecom- pared with a six per cent decrease in the same period last year. The price reduction has come at a perfect time: while economic conditions begin to slowly improve, consumers are still extremely price sensitive. These price cuts therefore allow dental professionals to of- fer premium implant products to their patients at a reduced rate. Straumann’s price reduction is not its only foray into the value market. In the first quar- ter of this year, the company pur- chased US$30 million worth of bonds from low-cost South Korean dental implant manufacturer Mega- Gen. The investment, which will be con- verted to shares in 2016, will help bolster Straumann’s revenue while allowing it to par- ticipate in both the premium and value seg- Dentalimplantcompetitors shakethingsup Author_Kristina Vidug, USA 26 I implants4_2014 [PICTURE: ©SASHKIN]