Despite significant growth over the past several years, Encore Medical found it difficult to win over investors. So it has turned to private equity firm Blackstone Group to take it private, hoping that greater financial freedom will enable it to continue its aggressive growth.

The recent acquisition of ACMI by Gyrus boosts both companies considerably and creates a powerful competitor in urology, gynecology, and general surgery. But having created critical mass, have they also attracted the attention of much larger companies--threatening both the comfortable niches they occupy and their independence?

Consolidation has created a widening gulf between small start-ups with innovative technology and large multi-faceted companies that control sales and distribution channels, making life difficult for mid-sized companies caught in the middle. Nowhere is this more true than in orthopedic devices. Now, some investors are finding opportunities in mid-sized companies by using them as platforms to build more substantial plays. The goal isn't market leadership, but value creation for shareholders, which can be done on a more modest scale.

Putting the research of universities and other institutions to commercial use, particularly in the field of medical devices, remains Biomec's primary focus.