Strategic Company Financials: Orthopaedics and Spine

Here we present final 4Q12 and 2012 revenue for remaining companies, as well as Biomet’s latest fiscal quarter. Exhibit 1 displays orthopaedic sales increases by product segment for 2012 vs. 2011 unless otherwise noted. Performance highlights that follow pertain to a blend of 4Q12 and 2012.

EXHIBIT 1
ORTHOPAEDIC SALES1 INCREASES BY PRODUCT SEGMENT: 2012 VS. 2011

April 2013_Financils

NOTES TO EXHIBIT 1

1. Orthopaedic products except as indicated; constant currency, pro forma growth
2. Includes biologics
3. For the quarter ended 2/28/13. Includes Dental and acquisition. Spine includes Bone Stim and Biologics; Bone Stim reflects all Bone Healing sales.
4. Includes acquisition of Synthes
5. For period ended 1/25/13
6. For period ended 12/31/12
7. Extremities: extremities + fixation combined; Endoscopy: endoscopic + communications, most of which is orthopaedic; Spine: neuro + spine. Total growth excludes Patient Handling.
8. ORTHOWORLD estimates

 

aap Implantate
€36.4MM (~US $47.9MM), +25%

  • LOQTEQ €2.0 (~US $2.6MM)
  • Signed pilot U.S. marketing agreement in 4Q for LOQTEQ plates
  • Signed agreement to co-develop bone cement with unnamed global medtech company
  • Delayed to 1Q13 commencement of in vivo studies of silver coating technology; consulting with regulatory bodies on CE Mark process for the product, which will have application in trauma and orthopaedics


Alphatec Spine
$196.3MM, +1% (U.S. $130.5MM, -3%; ex-U.S. $65.8MM, +7%: Japan ~$29MM, +>20%)
4Q12 revenue: $52.7MM, +8% (U.S. $34MM, +4%; ex-U.S. $18.7MM, +16%)

  • Received regulatory clearance in Japan to market NOVELA PEEK Spinal Spacers
  • PureGen update: submitted Request for Designation to FDA for classification as tissue-based, not biologic product; seeking FDA clarification on how to structure clinical trial
  • 2013 product launches: Pegasus anterior cervical interbody device; MIS ILLICO screw fixation; relaunch of Solis (U.S. late 2Q/early 3Q)


ArthroCare
$244.9MM, +3% (U.S. $156.9MM, +3%; ex-U.S. $87.9MM, +2%)

  • Sports Medicine $235.7MM, +3% (U.S. $155.1MM, +4%; ex-U.S. $80.6MM, +2%)
  • Other (includes Spine) $9.1MM, -6% (U.S. $1.8MM, -34%; ex-U.S. $7.3MM, +5%)

4Q12 revenue: $66.1MM, +2% (U.S. $41.8MM, -2%; ex-U.S. $24.3MM, +9%)

  • Sports Medicine $63.5MM, +2% (U.S. $41.2MM, -2%; ex-U.S. $22.2MM, +9%)
  • Other (includes Spine) $2.5MM, +3% (U.S. $0.5MM, -13%; ex-U.S. $2.0MM, -17%)
  • Acquisition of Eleven Blade Solutions closed 1Q13 following FDA clearance of products
  • 2H13 product launches include Coblation for anterior cruciate ligament reconstruction, could include Eleven Blade product portfolio
  • Noted no pick-up on contract manufacturing business with Wright Medical, none anticipated


Biomet (for fiscal 3Q13 ended 2/28/13)
$771.5MM, +9% (U.S. $472.9MM, +9%; Europe $184.7MM, +4%; International $113.9MM, +20%)
Reconstructive $423.9MM, +1% (U.S. +1%)

  • Hips +1% (U.S. +1%)
  • Knees +1% (U.S. +1%)
  • Bone Cement/Other -1% (U.S. +2%)
  • Sports Med/Extremities/Trauma (S.E.T.) $161.4MM, +73% (U.S. +62%)
  • Sports Med +3% (U.S. -5%)
  • Extremities +19% (U.S. +26%)
  • Trauma +296% (U.S. +291%)
  • Spine/Bone Healing $72.1MM, -4% (U.S. -6%)
  • Spine -1% (U.S. -3%)
  • Bone Healing -13% (U.S. -13%)
  • Other $49.7MM, -4% (U.S. -1%)
  • Growth includes acquisition and dental.

Excluding acquisition: 
Overall growth +1% (U.S. +2%, Europe -5%, International +7%)
S.E.T. +9% (U.S. +11%); Trauma flat (U.S. +8%)

Reconstructive: Hips/Knees

  • Taperloc Complete hip driving significant new business in Japan
  • Commenced limited clinical evaluation of G7 Acetabular Cup multi-bearing system, will continue into next fiscal year
  • Launched Signature knee system in India and Japan
  • Expanded Oxford knee direct-to-consumer campaign featuring lifetime warranty program to additional U.S. markets
  • Expecting FY4Q limited launch of Vanguard SSK 360 Revision Knee in Canada, full launch in Japan

S.E.T.

  • Launched JuggerKnot Long anchor, primarily indicated for hip labral repair
  • “Remarkable” growth from Comprehensive Shoulder System portfolio
  • Commenced clinical evaluation in U.S. and select ex-U.S. markets for comprehensive access instrumentation, full U.S. rollout expected in FY4Q

ConMed
$480.5MM, +10% (MTF partnership revenue $28MM)

  • Arthroscopy $330.5MM, +14%
  • Powered Surgical Instruments $150.0MM, +1%

4Q12 revenue: $124.9MM, +12% (MTF partnership revenue $7MM)

  • Arthroscopy $86.6MM, +16%
  • Powered Surgical Instruments $38.3MM, +3%

 

DJO Global
$1,129.4MM, +7%

  • Bracing/Vascular $441.2MM, +8%*
  • Recovery Sciences $334.6MM, -2%
  • Surgical Implant $72.9MM, +12%
  • International $280.5MM, +6%

*Bracing/Vascular includes products serving the diabetes market.


Exactech
$224.3MM, +9% (U.S. $145.6MM, +9%; ex-U.S. $78.7MM, +9%)

  • Hips $40.8MM, +21%
  • Knees $81.4MM, +2%
  • Biologic & Spine $24.5MM, +1%
  • Extremity $52.1MM, +30%
  • Other $25.6MM, +6%

4Q12 revenue: $59.3MM, +12% (U.S. $38.3MM, +13%; ex-U.S. $21.0MM, +12%)

  • Hips $10.4MM, +12%
  • Knees $20.7MM, +3%
  • Biologic & Spine $6.4MM, +9%
  • Extremity $14.9MM, +35%
  • Other $6.9MM, +3%
  • Strong hip/knee performance in Asia; strong hip, knee, shoulder growth in Latin America
  • Encouraging results from limited release of Element hip line extension, Novation Crown Cup acetabular system
  • 4Q Extremity growth buoyed by new U.S. customer acquisition, notable Latin America growth
  • 2013 product launches include CR Constrained tibial insert, limited launch of neck-preserving stem (2Q), computer-assisted knee surgical system (2H13)


Globus Medical
$386.0MM, +16% (U.S. $355.6MM, +14%; ex-U.S. $30.4MM, +49%)

  • Fusion $238.7MM, +6%
  • Disruptive Technology $147.3MM, +38%

4Q12 revenue: $100.5MM, +14% (U.S. $91.9MM, +13%; ex-U.S. $8.6MM, +37%)

  • Fusion $58.2MM, +3%
  • Disruptive Technology $42.4MM, +35%
  • Key product launches include Secure-C, AFFIRM Kyphoplasty, RISE expandable lumbar fusion device inserted via endoscopic tube, SI-LOK sacroiliac fusion system, FORTIFY expandable titanium/PEEK corpectomy spacer, etc.


Greatbatch Medical
$122.0MM, -8% 

4Q12 revenue: $30.9MM, -2% flat

  • Stronger implant revenue offset decline in instrument sales due to transition of Swiss facility
  • Successfully completed key customer supplier certification audits, reached resolution on Zimmer lawsuit
  • Ceased Swiss manufacturing of reamers 1/31/13
  • Fort Wayne facility validation process on track (straight reamer handles on track for shipment, offset reamer handles and impactors undergoing process validation)


Integra LifeSciences
$369.3MM, +12% (U.S. $312.8MM, +15%; ex-U.S. $56.4MM, -1%)

  • U.S. Extremities $122.8MM, +25%*
  • U.S. Spine & Other $190.5MM, +9%

4Q12 revenue: $93.2MM, +4% (U.S. $78.9MM, +6%; ex-U.S. $14.3MM, -6%)

  • U.S. Extremities $31.2MM, +9%*
  • U.S. Spine & Other $47.7MM, +5%

*Extremities includes wound and skin products.

  • Spine hardware growth driven by new products : Malibu MIS and Daytona for deformity correction
  • Completed “small product line acquisition” in extremities in 1Q13, will formally launch modular shoulder with reversed option later in 2013 (to complement regenerative portfolio)


LISI Medical
€64.8MM (~US $86.7MM), -12%

  • Noted that business should become consolidated in 2013 with several project launches, focus on customers and segments that offer middle- and long-term growth


MAKO Surgical
$102.7MM, +22%

  • Procedures $50.9MM, +47%
  • Systems $41.2MM, -6%
  • Service $10.5MM, +78%

4Q12 revenue: $30.2MM, -8%

  • Procedures $14.2MM, +26%
  • Systems $12.7MM, -36%
  • Service $3.1MM, +84%

Highlights pertain to 2012.

  • 45 RIO systems sold worldwide (41 U.S., 4 ex-U.S.)
  • 47 MAKOplasty Total Hip Arthroplasty applications sold, -4%; >1,200 procedures performed
  • 3rd version of hip software slated for 2013 launch


Medtronic (for 3Q13 ended 1/25/13)
$753MM, -3% (U.S. $522MM, -6%; ex-U.S. $231MM, +3%)

  • Core Spinal $639MM, flat (U.S. $422MM, -1%; ex-U.S. $217MM, +3%)
  • Biologics $114MM, -21% (U.S. $100MM, -22%; ex-U.S. $14MM, -7%)
  • Excluding kyphoplasty, Core Spine +2% (U.S. +1%)
  • Quarter-end growth affected by supply constraint of sterile water that is component of Infuse kit; resolved with alternate supplier
  • Noted sequential stabilization in U.S. Core Spine
  • Closed acquisition of China Kanghui
  • Solera system generating strong surgeon interest
  • Ramping up surgeon training on Bryan ACD
  • Interbody growth driven by AMP products, Capstone Control
  • Results from Infuse study not expected until early FY14

NuVasive
$620.3MM, +15% (Ex-U.S. +45%)

  • U.S. Lumbar +5%
  • U.S. Cervical +15%
  • U.S. Biologics +8%
  • U.S. Intraoperative Monitoring $39MM

4Q12 revenue: $165.8MM, +10% (U.S. implants $111.7MM, +7%; ex-U.S. $14.8MM, +65%)

  • U.S. Lumbar +6%
  • U.S. Cervical +11%
  • U.S. Biologics $28.4MM, +6%
  • U.S. Intraoperative Monitoring $9.6MM, -1%
  • Received Shonin approval to sell posterior spinal fusion, XLIF implants in Japan
  • Continuing rollout of Precept, multilevel percutaneous posterior MIS solution selling at premium price


Orthofix
$462.3MM, +0.4%

4Q12 revenue: $112MM, -8%

  • Spine Repair Implants/Regenerative Biologics $36.3MM, flat
  • Spine Regenerative Stimulation $39.4MM, -7%
  • Orthopaedics $36.4MM, -15%
  • Strong U.S. implant/biologic sales offset by regulatory and macroeconomic headwinds in Europe and Brazil
  • 2013 launches include Tempus Anterior Cervical Plate, Centurion Posterior Cervical Plate, next-gen Trinity Elite formula (2H13)


Symmetry Medical
$410.5MM, +14%

  • Instruments $115.2MM, flat
  • Implants $102.0MM, -1%
  • Cases $58.5MM, -23%
  • Other $27.6MM, +10%
  • Surgical $107.2MM, +172%

4Q12 revenue: $106.6MM, +26%

  • Instruments $30.0MM, +10%
  • Implants $26.5MM, +16%
  • Cases $13.9MM, -12%
  • Other $7.7MM, +8%
  • Surgical $28.5, +154%
  • Noting sequential improvement, increased implant demand due to stronger procedural growth, while instrument sales benefitted from stable capital spending


Tornier
$277.5MM, +9% (U.S. $156.7MM, +11%, ex-U.S. $120.7MM, +8%)

  • Total Extremities $224.8MM, +12% (Upper $175.2MM, +9%, Lower $34.1MM, +33%, Sports Med/Biologics $15.5MM, +7%)
  • Large Joints/Other $52.6MM, +1%

4Q12 revenue: $79MM, +16% (U.S. $46.1MM, +24%; ex-U.S> $32.9MM, +7%)

  • Total Extremities $64.7MM, +20% (Upper $45.8MM, +6%, Lower $14.7MM, +112%, Sports Med/Biologics $4.1MM, +5%; OrthoHelix~$8MM)
  • Large Joints/Other $14.2MM, +2%
  • Commenced limited launch of Ascend Flex primary or reversed shoulder, with press-fit option; full launch occurring 3Q
  • Began full U.S. commercial launch of Latitude EV elbow, ex-U.S. slated for 2H13
  • Planning 2H13 launch of KneeTec cementless knee


TranS1
$14.5MM, -24%

4Q12 revenue: $4.1MM, +4% (U.S. $3.0MM, -19%; ex-U.S. $1.1MM, +277%)

  • U.S. AxiaLIF $1.9MM (62% 1-Level, 38% 2-Level)
  • U.S. VEO $0.6MM
  • Ex-U.S. growth supported by initial stocking order for new China distributor
  • Completed 209 AxiaLIF (157 in U.S.) and 61 VEO procedures (latter +22% sequentially)


Wright Medical
$483.7MM, -5% (U.S. $275.6MM, -7%; ex-U.S. $208.0MM, -2%)
OrthoRecon $269.6MM, -9% (U.S. -15%; ex-U.S. -5%)

  • Hips $150.5MM, -12% (U.S. -18%; ex-U.S. -8%)
  • Knees $114.8MM, -6% (U.S. -13%; ex-U.S. +2%)
  • Other Recon $4.2MM, -14% (U.S. -13%; ex-U.S. -14%)
  • Extremities $214.1MM, +2% (U.S. flat; ex-U.S. +11%)
  • Foot/Ankle $122.8MM, +15% (U.S. +15%; ex-U.S. +26%)
  • Upper Extremity $24.9MM, -9% (U.S. -13%; ex-U.S. -1%)
  • Biologics $60.4MM, -13% (U.S. -16%; ex-U.S. +1%)
  • Other Extremities $5.7MM, flat (U.S. +12%; ex-U.S. -6%)

4Q12 revenue: $123.5MM, -2% (U.S. 70.6MM, -4%; ex-U.S. $52.8MM, flat)
OrthoRecon $65.0MM, -11% (U.S. -17%; ex-U.S. -7%)

  • Hips $35.9MM, -14% (U.S. -17%; ex-U.S. -13%)
  • Knees $27.9MM, -8% (U.S. -17%; ex-U.S. +4%)
  • Other Recon $1.2MM, +30% (U.S. +154%; ex-U.S. +11%)
  • Extremities $58.3MM, +11% (U.S. +6%; ex-U.S. +30%)
  • Foot/Ankle $35.3MM, +20% (U.S. +16%; ex-U.S. +37%)
  • Upper Extremity $5.8MM, -10% (U.S. -17%; ex-U.S. +10%)
  • Biologics $15.2MM, -2% (U.S. -8%; ex-U.S. +21%)
  • Other Extremities $1.9MM, +84% (U.S. +100%; ex-U.S. +76%)
  • Launched DYNASTY BIOFOAM Cup, EVOLUTION Medial Pivot knee in Japan
  • Future foot/ankle market will be led by total ankle replacements, new hammertoe implants


Sources: Company press releases, earnings calls, filings with the Securities and Exchange Commission

Julie A. Vetalice is Content Coordinator for ORTHOWORLD Inc. She can be reached at 440.543.2101 or This email address is being protected from spambots. You need JavaScript enabled to view it..