Musculoskeletal News Roundup 28-Feb-2008
BY LAUREN UZDIENSKI, FEBRUARY 28, 2008
Earnings
Artimplant reported 4Q:07 revenues of SEK 5.0 million ($0.8 million), up from SEK 1.6 million ($0.25 million) in the year-ago period. The net loss for 4Q:07 was SEK 2.1 million ($0.34 million), improved from a loss of SEK 9.5 million ($1.52 million) in 4Q:06. Among 2007 full-year highlights, sales of the Artelon® CMC spacer increased to approximately 3,900 from 2,750 units; Artelon® Tissue Reinforcement was granted FDA clearance for several new indications; two new Spacer products received FDA clearance; and Artimplant signed an agreement with Small Bone Innovations for new resurfacing indications for the hand and wrist.
Exactech reported 4Q:07 revenues of $33.1 million, in line with estimates and reflecting a 26% increase over the year-ago period. Among segments, knee sales increased 24% to $16.5 million; hip sales increased 15% to $5.7 million; upper extremity sales increased 132% to $3.2 million; and biologics increased 25% to $4.6 million. Both domestic and international sales increased 26% over 4Q:06. Net income was $2.7 million, or $0.23 per diluted share, up 20% over 4Q:06 and in line with estimates.
LifeCell reported 4Q:07 product revenues of $52.6 million, reflecting a 34% increase over the year-ago period. Net income for 4Q:07 was $5.5 million, or $0.16 per diluted share, beating estimates by a penny and down from 4Q:06's net income of $6.2 million. The decrease in net income was attributed to the distribution of a tax credit. The product revenue growth was attributed to a 38% increase in sales of AlloDerm® Regenerative Tissue Matrix, which contributed $46.9 million in revenue for the quarter. Orthopedic product revenues, which include GraftJacket and AlloCraft DBM, increased 13% in 4Q:07 to $3.1 million.
Orthofix reported 4Q:07 revenues of $128.8 million, missing estimates by $1.1 million and representing an 11% increase over 4Q:06. Adjusted net income for 4Q:07 was $7.6 million, or $0.45 per diluted share, missing estimates by $0.17. During 4Q:07, the spine business grew 10% to $64.2 million, and implant and biologic revenue from Blackstone Medical increased 8% to $30.5 million. Blackstone's revenue was lower than expected, which was attributed by the company to reduced availability of Trinity bone growth matrix and the termination and replacement of a distributor during the quarter. Revenues from Orthofix’s orthopedic business rose 21% to $30.0 million, and sales from the sports medicine business grew 9% to $23.0 million.
Osiris reported 4Q:07 total revenues of $7.2 million, beating estimates by $1.5 million and representing a 125% increase over the year-ago period. 4Q:07 Osteocel sales were $6.0 million, up 100% from 4Q:06. Net loss for the quarter was $21.6 million, or $0.72 per share, widening from a net loss of $12.7 million in 4Q:06. The increased loss was attributed to clinical trial costs.
Synthes reported 4Q:07 revenues of $738.0 million, an increase of 17.4% reported (13.1% local currency) over 4Q:06. North American revenues were $477.0 million for the quarter, driven by above-market sales growth in Trauma (including power tools) and CMF. European sales experienced double-digit growth in Trauma, Spine and CMF, and sales in the region were driven by sales force expansion, increased educational offerings and new product launches. In Asia Pacific, all divisions experienced revenue growth, particularly Spine.
M&A
Exactech plans to acquire the stock and assets of France Medica SAS, a Strasbourg-based importer and distributor of orthopedic products and surgical supplies. The total purchase price is projected to be EUR 6.8 million to EUR 7.1 million ($10.2 million to $10.7 million.) Exactech expects France Medica’s full-year 2008 revenues to be approximately EUR 8.0 million ($12.0 million.)
MDY Healthcare PLC acquired Stanmore Implants Worldwide Ltd for £12.5 million ($25.6 million) in a joint deal with Abingworth Management and Ivy Capital Partners. According to MDY, Stanmore Implants has annual sales of approximately £4.0 million ($7.9 million) and is profitable.
Regeneration Technologies, Inc. and Tutogen Medical, Inc. completed their merger this week. The new company will be called RTI Biologics, Inc. and will continue to trade under the symbol RTIX. The total value of the transaction was approximately $205 million.
Regulatory
Cayenne Medical, Inc. received FDA clearance for its iFix Interference Screw System for use in bone-tendon-bone ACL reconstruction procedures. According to the press release, the iFix Interference Screws are the first FDA-approved screws that are manufactured using PEEK.
The Swedish Medical Product Agency announced that the marketing surveillance initiated in December 2006 for for NobelDirect and NobelPerfect is closed. The agency has also reviewed additional data on the products as well as amended instructions for use.
Investigations
As a follow-on to the proposal of the Physician Payment Sunshine Act, which would require drug and device companies to publicly disclose payments made to physicians, Congress heard comments yesterday from representatives from Stryker, Zimmer, AdvaMed and the OIG. The industry has been generally supportive of the Sunshine Act, with certain changes.
Legal
Medtronic's lawyers have been fined $10.0 million over their conduct during the company's recent patent dispute with Depuy. The judge found that Medtronic's attorneys prolonged the proceedings unnecessarily and attempted to take advantage of the case's technical and legal complexities. Medtronic was also ordered to pay a portion of Depuy's attorneys' fees.
Distribution
The Premier healthcare alliance awarded Exactech two national purchasing contracts, which Exactech says represent the company's first GPO contracts. The contracts are for bone cement and total joint replacements, including InterSpace cement spacers.
Exactech announced plans to open a direct distribution operation in Japan, where it previously sold its products through a distributor. Based in Tokyo, the direct operation sales and logistics subsidiary "enables Exactech to directly control its Japanese marketing and distribution operations." Kunio Watanabe will head the new site's operations.
Appointments
J. Chris McAuliffe has been appointed Executive Vice President, Field Operations at Paradigm Spine, LLC. The appointment was made in preparation for the 2008 U.S. launch of the company's non-fusion spinal implant products. Mr. McAuliffe joined Paradigm Spine in 2006 as Director of Technical Services and Professional Education to lead the U.S. coflex IDE trial.
Anthony Ruggiero was appointed Vice President for Sales and Business Development at Ceremed, Inc., effective February 25th. Previously, Mr. Ruggiero served as Americas and Asia Pacific Commercial Director at Invibio.
HealthpointCapital, LLC appointed Dr. Stephen H. Hochschuler as Clinical Advisor to the Firm. Dr. Hochschuler is the co-founder of the Texas Back Institute, Chairman of Texas Back Institute Holdings and Chairman of the Board, a founding member and former President of the Spine Arthroplasty Society and a board certified orthopedic surgeon. “We are very pleased that Dr. Hochschuler is joining us as Clinical Advisor,” stated Mortimer Berkowitz III, President of HealthpointCapital. “Investing in companies that improve patient care is central to HealthpointCapital investment thesis which means we are continually deepening our scientific knowledge and relationships in order to build companies that offer the most innovative products and best clinical outcomes. Dr. Hochschuler’s unparalleled understanding of medical science and advanced technologies will allow us to better deliver to the marketplace and create value for our investors."
