Orthopedic News Roundup 12-Aug-2005
BY HUYEN NGUYEN, AUGUST 12, 2005
This week we completed the orthopedic reporting calendar as a few more companies reported earnings, starting with Synthes, the number #1 trauma company worldwide. Synthes reported 20% growth in both top and bottom line for 1H:05. Consolidated sales reported at $1 billion vs. $858 million and adjusted net income at $225 million vs. $188 million compared to 1H:04. The Locking Compression Plate (LCP) continues to be the primary driver for Synthes in the trauma business. Another solid report came from Intergra LifeSciences, which reported a 24% increase in revenues ($70 million vs. $56 million) and a 14% year-over-year increase in adjusted net income ($9.6 million vs. $7.5 million). The previously acquired foot and ankle company, Newdeal, contributed $4.1 million in sales for the quarter.
Biologics: Orthovita, a developer of biomaterials, reported 2Q:05 product sales of $8.4 million compared to $5.6 million, a 51% increase YOY. Net loss for the quarter was $2.7 million compared to $2.6 million, an improvement of $100,000. Improvement in sales was contributed to an increase in market penetration in the U.S. Synthetic biomaterials company, IsoTis Biologics, reported $7.5 million in 2Q:05, a 17% increase compared to 2Q:04. Net income for the quarter was $2.9 million, a significant improvement over a net loss of $9 million in 2Q:04. In 2Q:05, IsoTis benefited from foreign currency translation by $5.2 million. Sales in the U.S. grew by 13% and international grew by 36%.
Acquisition: A bracing and soft goods company, dj Orthopedics, announced it has acquired the assets of the orthopedic soft goods (OSG) business from Encore Medical for approximately $10 million. A California-based orthotic company, ONNI Surgical also announced that its parent company, Medical Innovations, Ltd., plans to acquire Apex Surgical for an undisclosed amount. Read our our own analysis on these deals.
Appointment: Alphatec Manufacturing, Inc., a portfolio company of HealthpointCapital, welcomes two new officers to the company: Scott Palka and Vicky Romanoski. Mr. Palka will serve as Chief Financial Officer and Vice President and Ms. Romanoski will serve as Chief Administrative Officer and Vice President of Alphatec. A well-known and well-respected industry leader, Thomas R. Trotter, was hired by AngioScore as their new Chief Executive Officer. Mr. Trotter was previously President and Chief Executive Officer of OrthoLogic. HydroCision, a developer of fluidjet-based surgical technology company, has hired Steven Van Tyle to the position of Director of International Sales. Prior to joining the Company, Mr. Tyle was Vice President of Sales for Raymedica, Inc. Industry veteran, John W. Brown, Chairman of the Board of Stryker Corp. was elected to Board of Directors of St. Jude Medical.
Clinical: A Finland-based biodegradable implantable technology company, Inion Ltd., received 510(k) clearance for its Anchron Suture Anchor for orthopedic and sports medicine applications. FzioMed, an absorbable biomaterials company, received a U.S. patent for its Oxiplex technology which covers a broader range of drug delivery and hemostasis. A tissue regeneration company, Collagen Matrix, Inc., received 510(k) clearance for its natural anorganic bone graft material intended for use in oral surgical applications involving bone repair.
Distribution Agreement: Stryker announced this week that it has entered into an exclusive U.S. distribution agreement with London-based orthopedic manufacturer, Corin Group. Stryker will distribute the Optimom metal-on-metal large diameter articulation system and also the Cormet Hip Resurfacing System once it is approved for sale in the U.S. Velcura Therapeutics, Inc., a biotech company that stimulate bone growth ex vivo, and Nippon Chemiphar, a Japanese pharmaceutical company, announced an agreement to develop new small-molecule therapies for osteoporosis and other bone diseases.
Funding: Computer assisted surgery company, ORTHOsoft, received funding from the Quebec government. The Company along with the governement is establishing an international Orthopaedic Surgery Navigation Training Centre in Montreal.
Operational Update: An OEM manufacturer and distributor of orthopedic products, Symmetry Medical, announced an establishment of a new facility in Warsaw, Ind. The total cost is approximately $2.5 million with 30,000 square feet in lot size. The building will serve as technical and design support to customers. The Osteotech property, 201 Industrial Way, was sold and leased back for $16.5 million. The facility is currently used to process allograft tissues.
Product Update: An allograft company, CryoLife, announced that its cryopreserved high-dose irradiated human orthopaedic tissues will be labeled sterile. NuVasive, an MIS technology company dedicated to spine surgery, launches the Percutaneous I-PAS(TM) Insulated Pedicle Access System to determine the safety of this technique used in spine surgery. DCI Donor Services has converted its soft tissue allograft product line to the CLEARANT PROCESS(R) sterilization method. Clearant, Inc. is the developer of the patent-protected CLEARANT PROCESS(R).
Miscellaneous: Another web-based news publication is educating patients with advice and an alternative to artificial disc surgery. A personal story on an active teenager who suffers from a torn ACL, according to the AAOS, more female basketball players have ACL surgery than their male counterpart. With the improvement of medical devices and technological advances, older patients are living longer and are in much better conditions than years ago. In a recent New England Journal of Medicine, a study was published showing that patients taking parathyroid hormone, or PTH for a year, followed by a year of alendronate (marketed as Fosamax), patients showed improvement of bone density compared to those who took either drug alone. The Wait Time Alliance in Canada has issued a report which sets time limit on how long patients should wait for certain health-related issues when being served in a public health facility.
