Orthopedic News Roundup 19-Apr-07
BY LAUREN UZDIENSKI, APRIL 19, 2007
Earnings
Stryker announced 1Q:07 earnings on Wednesday. Net income increased to $243.5 million, or $0.59 per share, beating analysts' estimates of $0.58 per share. In the comparable quarter, net income was $147.5 million, or $0.36 per share. Revenues increased 13% over the comparable quarter, reported at $1.49 billion and beating estimates of $1.47 billion.
Synthes announced 1Q:07 revenues of $658.0 million, representing a a 14.2% growth rate that failed to live up to analyst expectations of $663.0 million. In their press release, the Company attributed the slower growth to a warm winter and a lack of skiing accidents, which they said negatively affected its trauma line, as well as price decreases from the Japanese government. Synthes' stock fell following the announcement.
Johnson & Johnson reported 1Q:07 revenues of $15.0 billion, beating estimates of $14.9 billion and representing an increase of 15.7% over 1Q:06. Net income was $2.6 billion, or $0.88 per share, missing analysts' estimates of $0.96 per share. Worldwide sales in the Depuy Spine division totaled $1.16 billion, up from $1.04 billion in 1Q:06. U.S. sales totaled $678.0 million, an increase from $644.0 million in the comparable quarter.
Lifecore Biomedical reported revenues of $18.9 million in the third quarter ended March 31, meeting analysts' estimates and demonstrating a 12% increase over net sales of $16.8 million in the comparable quarter. Foreign currency translation comparisons increased current quarter sales by $271,000 compared to the third quarter of last fiscal year. Net income for the quarter was $2.33 million or $0.17 per diluted share, missing analysts' estimates of $0.18. This compares to net income of $2.19 million, or $.16 per diluted share, in the comparable quarter.
M&A
Wright Medical Group acquired a range of external fixation devices for the foot and ankle and trauma markets from Pennsylvania-based R&R Medical, Inc. Terms include an initial cash payment of $8.0 million and potential additional cash payments based upon future financial performance of the acquired assets.
Regulatory
This week the FDA announced its recommendations for MDUFMA II; the current incarnation of the act is set to expire later this year. If approved, MDUFMA II would decrease user fees, speed up decisions on PMA and 510(k) applications, and increase transparency between manufacturers and the FDA, among other revisions. A 30-day comment period is now open, and a public hearing will take place on April 30.
Spine Wave annnouced 510(k) approval for two spine devices this week: the CapSure™ PS Spine System, a pedicle screw system and the StaXx® FX Structural Kyphoplasty System for the treatment of vertebral compression fractures. In the StaXx® System, PEEK wafers are stacked in situ to distract and support the fractured vertebral body.
Reimbursement
CMS released its 2008 pricing guidelines this week, and they could prove positive for device manufacturers. Among the increases: reconstructive joint DRGs are up 2.5-3%, spine is up an average of 3-6%, and trauma is up 10%. A new code has been assigned for artificial disc coverage with a rate of approximately $9,000.
Legal
A Massachusetts superior court denied Depuy's motion to dismiss four lawsuits filed against the company over claims that their Charite artificial disc is defective. Depuy claimed that because the disc was approved by the FDA, the company should be protected from lawsuits from patients.
Product Introduction & Update
HydroCision launched the MicroResector MD at this week's AANS meeting in Washington, D.C. The MicroResector MD is based on HydroCision's HydroDiscectomy™ platform and "uses a high-velocity waterjet to quickly and safely decompress herniated discs" to relieve chronic back and leg pain.
Clinical
Invibio presented new data today on the cytocompatibility of PEEK-OPTIMA® compared with grade 1 commercially pure titanium (cpTi). The study found that differentiated bone cells and mineralization on PEEK-OPTIMA surfaces was comparable to titanium, indicating that PEEK may provide a favorable surface for osseointegration.
Operations
German spinal implant manufacturer Ulrich Medical launched Ulrich Medical USA, a U.S. subsidiary based in Chesterfield, Mo. Merle Symes was named the Chesterfield divison's CEO and Helmut Schoenhoeffer appointed vice president of business development and marketing. Additional staff are being hired for the new office.
Appointment
MicroDTI announced the appointment of Edward Shellard as its Chief Executive Officer. Dr. Shellard is a well-respected dental industry executive and was most recently the President of Kerr. John H. Foster, Chairman of the Board of MicroDTI and Chairman of HealthpointCapital, LLC, said, "After an extensive search process, we are excited to bring an executive as talented as Ed on board to lead MicroDTI. He possesses a rare combination of both clinical and executive experience. His focus on and understanding of the needs of dentists, and accomplishments in functions as diverse as R&D and marketing will keep MicroDTI at the forefront of the industry."
Miscellaneous
Biomet has received permission from Nasdaq officials to continue trading on the exchange, even though the Company has not filed its quarterly report for the period ending Nov. 30. Nasdaq stipulated that Biomet must file its delinquent earnings reports by May 29, 2007. Biomet plans to request additional time to file its report for the period ended Feb. 28, 2007 as well.
