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Surgalign reported 2Q21 orthopedic revenue of $24.8 million, +20.9% vs. 2Q20. However, the company declined -24.2% compared to 2Q19. Quality and regulatory issues that impacted product availability offset the gains from the return of elective procedures. Leadership described the problem as “continued quality issues in our global supply chain related to the separation of the business.”
Some relief is on the way, as Surgalign expects FDA clearance of its Holo system in the second half of 2021. The company plans a limited launch at that point focused on generating clinical data and early adopters. Company leadership said that each installed system could generate up to $1.5 million annually and estimated a total addressable market of $5 billion in lumbar spine procedures alone.
“The question [of a learning curve for Holo] is predominantly generated based on your experience with systems that are currently on the market. The robotics, the navigation systems, they’re not simple to operate. I can tell you with very high confidence that the learning curve here is very, very flat. To the point where we’ve done numerous tests with individuals of various capabilities anywhere from medical students all the way through experienced physicians, and they all perform very well in terms of their precision accuracy and ability to deliver the implant literally on the first try.” – Surgalign Chief Medical Officier Kris Siemionow
Revenue Data
All revenue data is provided in USD millions unless otherwise noted. Sales and growth rates are estimated on an as-reported basis.
Segment Sales
| 2Q21 | 2Q20 | $ Chg | % Chg | |
|---|---|---|---|---|
| Spine | $19.2 | $15.6 | $3.6 | 23.3% |
| Orthobiologics | $5.6 | $4.9 | $0.7 | 13.4% |
| Total | $24.8 | $20.5 | $4.3 | 20.9% |
| 1H21 | 1H20 | $ Chg | % Chg | |
|---|---|---|---|---|
| Spine | $37.1 | $36.7 | $0.3 | 0.9% |
| Orthobiologics | $11.1 | $10.9 | $0.2 | 1.6% |
| Total | $48.1 | $47.6 | $0.5 | 1% |
Geographic Sales
| 2Q21 | 2Q20 | $ Chg | % Chg | |
|---|---|---|---|---|
| US | $20.7 | $17.0 | $3.8 | 22.3% |
| OUS | $4.1 | $3.6 | $0.5 | 14.7% |
| Total | $24.8 | $20.5 | $4.3 | 20.9% |
| 1H21 | 1H20 | $ Chg | % Chg | |
|---|---|---|---|---|
| US | $40.6 | $39.2 | $1.4 | 3.4% |
| OUS | $7.6 | $8.4 | ($0.9) | (10.3%) |
| Total | $48.1 | $47.6 | $0.5 | 1% |
Earnings
| Amt | % of Sales | |
|---|---|---|
| Sales | $24.8 | |
| Cost of Sales | $7.2 | 29.1% |
| General and Admin | $25.5 | 102.8% |
| R & D | $3.2 | 12.8% |
| Other | $5.1 | 20.6% |
| Net Earnings | ($16.2) | (65.3%) |
Mike Evers is ORTHOWORLD’s Digital Content Strategist. He can be reached by email.
Surgalign reported 2Q21 orthopedic revenue of $24.8 million, +20.9% vs. 2Q20. However, the company declined -24.2% compared to 2Q19. Quality and regulatory issues that impacted product availability offset the gains from the return of elective procedures. Leadership described the problem as "continued quality issues in our global supply chain...
Surgalign reported 2Q21 orthopedic revenue of $24.8 million, +20.9% vs. 2Q20. However, the company declined -24.2% compared to 2Q19. Quality and regulatory issues that impacted product availability offset the gains from the return of elective procedures. Leadership described the problem as “continued quality issues in our global supply chain related to the separation of the business.”
Some relief is on the way, as Surgalign expects FDA clearance of its Holo system in the second half of 2021. The company plans a limited launch at that point focused on generating clinical data and early adopters. Company leadership said that each installed system could generate up to $1.5 million annually and estimated a total addressable market of $5 billion in lumbar spine procedures alone.
“The question [of a learning curve for Holo] is predominantly generated based on your experience with systems that are currently on the market. The robotics, the navigation systems, they’re not simple to operate. I can tell you with very high confidence that the learning curve here is very, very flat. To the point where we’ve done numerous tests with individuals of various capabilities anywhere from medical students all the way through experienced physicians, and they all perform very well in terms of their precision accuracy and ability to deliver the implant literally on the first try.” – Surgalign Chief Medical Officier Kris Siemionow
Revenue Data
All revenue data is provided in USD millions unless otherwise noted. Sales and growth rates are estimated on an as-reported basis.
Segment Sales
| 2Q21 | 2Q20 | $ Chg | % Chg | |
|---|---|---|---|---|
| Spine | $19.2 | $15.6 | $3.6 | 23.3% |
| Orthobiologics | $5.6 | $4.9 | $0.7 | 13.4% |
| Total | $24.8 | $20.5 | $4.3 | 20.9% |
| 1H21 | 1H20 | $ Chg | % Chg | |
|---|---|---|---|---|
| Spine | $37.1 | $36.7 | $0.3 | 0.9% |
| Orthobiologics | $11.1 | $10.9 | $0.2 | 1.6% |
| Total | $48.1 | $47.6 | $0.5 | 1% |
Geographic Sales
| 2Q21 | 2Q20 | $ Chg | % Chg | |
|---|---|---|---|---|
| US | $20.7 | $17.0 | $3.8 | 22.3% |
| OUS | $4.1 | $3.6 | $0.5 | 14.7% |
| Total | $24.8 | $20.5 | $4.3 | 20.9% |
| 1H21 | 1H20 | $ Chg | % Chg | |
|---|---|---|---|---|
| US | $40.6 | $39.2 | $1.4 | 3.4% |
| OUS | $7.6 | $8.4 | ($0.9) | (10.3%) |
| Total | $48.1 | $47.6 | $0.5 | 1% |
Earnings
| Amt | % of Sales | |
|---|---|---|
| Sales | $24.8 | |
| Cost of Sales | $7.2 | 29.1% |
| General and Admin | $25.5 | 102.8% |
| R & D | $3.2 | 12.8% |
| Other | $5.1 | 20.6% |
| Net Earnings | ($16.2) | (65.3%) |
Mike Evers is ORTHOWORLD’s Digital Content Strategist. He can be reached by email.
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ME
Mike Evers is a Senior Market Analyst and writer with over 15 years of experience in the medical industry, spanning cardiac rhythm management, ER coding and billing, and orthopedics. He joined ORTHOWORLD in 2018, where he provides market analysis and editorial coverage.
