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Dentsply Sirona Idea Proposal

Dentsply Sirona Idea Proposal

Will the Dentsply Sirona merger lead to accelerated adoption of its CEREC CAD/CAM system?

Report Available: September 15, 2016


Blueshift’s initial research found Dentsply’s recently completed merger with Sirona creating an opportunity for increased adoption of the CEREC system and a continued shift to digital dentistry and single-visit dentistry. However, film X-rays are still well regarded, heavily utilized, and digital is not without its flaws. Also, the dental industry experienced a surprising slowdown in June, which could delay decisions about a large capital outlay like a CEREC system.



  1. Dentsply completed its merger with Sirona in February 2016, joining together a leader in dental consumables and in dental technology and equipment. XRAY now boasts CEREC, a leading standard in dental hardware which allows patients to get inlays, onlays, crowns, and veneers in only one appointment instead of the usual two. This CAD/CAM system saves patients time and saves dentists lab fees. The merger comes with the hopes it will accelerate adoption of CEREC and expand its market share.
  2. XRAY has identified the adoption of digital dentistry and single visit dentistry as two megatrends the company is targeting for growth. This entails using CEREC to capitalize on the growing dental equipment market, which a recent report said will be worth $7.25 billion by 2021. The general equipment segment made up the biggest share of the global dental equipment product segment in 2015, led by growing adoption of CAD/CAM systems. The time to switch to digital dentistry is now, as 5,000 to 10,000 dentists are expected to make the switch to fully digitized work flows over the next couple of years.
  3. Still, convincing dental practices to transition to digital dentistry or upgrade their digital equipment will have its challenges. First, film is not dead. A 2015 survey of 6,500 dental practices revealed that 30% were still film-based. Digital is also criticized for inferior resolution, not being as safe for patients as reported, and being more costly than X-ray when considering the cost of the machine and sensors. Also, competition in the digital dentistry and CAD/CAM space is fierce, with every company claiming to be offering state-of-the-art technology. A dental product review website listed 15 different CAD/CAM systems and 30 different brands of digital radiography systems.
  4. XRAY reported mixed Q2 performance, exceeding EPS expectations but missing on revenues. Net sales increased 46.4% with the Dental & Healthcare Consumable Segment reporting Q2 sales of $543.8 million and the Technologies Segment bringing in $478.2 million. Dental consumables experienced growth across all categories and Imaging and Specialties drove growth in the Technologies Segment. There was robust demand for CEREC zirconia packages during the quarter. Full-year guidance was reiterated at $2.70 to $2.80. A red flag, however, came as the industry had an unexpected slowdown in June, followed by a slight recovery in July.


Will the Dentsply Sirona merger help CEREC’s adoption accelerate? What is the cost benefit of adopting CEREC? What are the factors in choosing whether to adopt CEREC or not? How has the ability to process Zirconia affected the value of owning the CEREC system? Is there any competitive offering that can challenge the CEREC system? What is the overall health of the dental industry? How is spending trending? How are office visits trending? What caused the Q2 slowdown? Will that persist for the rest of 2016? To gain insight into XRAY, CEREC, and the overall dental equipment and supply market, Blueshift will gather data and issue a market research report from independent sources in the following areas: Dentists and dental practice professionals, Dental lab professionals, Dental equipment and supply sales channel, and Industry specialists.


Companies: Dentsply Sirona (XRAY), Align Technology (ALGN), Henry Schein (HSIC), Integra Lifesciences (IART), 3M (MMM), Danaher (SWX:DHR), Straumann Holding (SWX:STMN), Zimmer Biomet Holdings (ZBH)


Research Begins: August 29, 2016