The use of titanium in a wide
variety of medical applications-hip and knee replacements,
dental implants, artificial hearts, trauma systems and the
like-is a very consistent and structured element of the global
Unlike aerospace and tool markets for
titanium, medical applications don't experience the peaks and
valleys more common to the much larger marketplace segments.
"It's a much more stable industry," said Frank Perryman,
president and chief executive officer of Houston, Pa.-based
Perryman Co. and 2009-10 president of the International
Titanium Association. "The medical market isn't cyclic-we don't
see drastic swings-but it's immensely smaller than, say,
Privately owned Perryman, which has annual
revenue of about $100 million, is a small player in an industry
dominated by such public companies as Pittsburgh-based RTI
International Metals Inc. and Allegheny Technologies Inc. Like
most of its competitors, Perryman derives about 70 percent of
its revenue from the aerospace industry.
But medical applications have looked to be
a much more attractive segment of the titanium industry since
the 2008 recession dramatically slowed sales to the aerospace
industry. Market prices for titanium dropped last year to their
lowest levels since 2004 after reporting healthy increases from
2006 to 2008.
With an estimated 8 million to 10 million
joint-replacement surgeries performed in the United States
during the past 10 years, titanium has quietly become the metal
of choice for orthopedic surgeons. Zimmer Holdings Inc., one of
the major orthopedic medical device manufacturers, said that
anywhere from 0.5 to 2 pounds of titanium is used in a typical
implant. The Warsaw, Ind.-based company uses approximately
800,000 pounds of titanium each year.
Titanium also has made real strides in
other medical applications in recent years. Dental posts and
other oral prosthetics have been a major medical titanium
market for more than a decade, with titanium dental implants
one of the fastest-growing segments of the market. Titanium
also is frequently used in spinal fusion repairs and in
maxillofacial surgery, and following U.S. Food and Drug
Administration approval in 2004 of a titanium mesh device for
hernia repair, surgeons have relied increasingly on the metal
for such uses.
Another major step forward for titanium's
medical applications was the 2001 introduction of an artificial
heart. Designed to give patients with terminal congestive heart
failure extra months of life when there is no chance of a
transplant, the implantable titanium and plastic heart was
approved by the FDA in 2007.
The dental, mesh and heart applications,
however, consume far less titanium than the average hip or knee
implant. Dental implants, for example, typically utilize just a
few ounces of titanium.
One of the demographic trends that will
characterize much of the next quarter-century is the aging of
the population, especially in the developed world. In the
United States, the first of 30 million baby boomers will get
their Medicare cards late this year and the surge of baby
boomers will continue unabated until nearly 2030. Japan already
has more of an aged population than the United States, and
developed countries in Europe aren't far behind the Japanese.
Even countries such as China-now 20 years into its "one child"
policy-Mexico and Vietnam will inexorably age in the next 25
Studies have shown that candidates for knee
and hip replacements are getting younger, which some
researchers attribute to the increased popularity of jogging
during the past 20 years. In the United States, an estimated
half of all hip replacements will be in patients under 65 as
early as next year, and as many as 60,000 people a year in the
45-to-54 age group are already seeking knee replacements.
With an increasing number of those knees
and hips in need of replacement, both in the United States and
the developed world, it's a strong likelihood that demand for
medical titanium will increase in the years to come. Some
orthopedists estimate that there could be as many as 1 million
candidates for knee replacement surgery annually in the United
States alone by 2030.
Perryman cautioned, however, that raw
numbers don't tell the whole story when it comes to predicting
the future for joint replacement-and demand for medical
For one thing, there's the cost. Adding up
surgery, anesthesia, several days' stay in a hospital and weeks
of physical therapy can easily lead to a $40,000 to $50,000
tab. The American Academy of Orthopaedic Surgeons recently
warned that low insurance and Medicare reimbursements for hip
and knee replacements could restrict the number of procedures
performed by surgeons. Already, surgeons and clinics as far
afield as India and Poland have begun advertising joint
replacement surgery for $10,000 or less.
Perryman said there's no question that the
governmental and insurance aspect of health care could have a
negative impact on the marketplace, but calling himself a
"cautious optimist" he noted that the potential market for
titanium joint replacements is going to skyrocket. He said he
wouldn't be surprised to see medical applications for titanium
grow at a 2- to 5-percent annual rate in years to come.
For Perryman, titanium is a
"quality-of-life issue. You get a hip implant, and the surgeon
gives you your life back."
The Perryman family has been in the
titanium business since James T. Perryman Sr. started working
in the industry in 1950. Perryman, who had gone to college to
study physics, got in on the ground floor of the industry in
the 1950s and 1960s, working for a succession of companies. In
1988, he and his two sons, Frank L. Perryman and James Perryman
Jr., started Perryman Co. in a Pittsburgh suburb. Today, the
company is one of the largest privately owned titanium
processors in the United States.