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Conformis reported 1Q23 orthopedic sales of $12.8 million, -17.5% compared to the first quarter of 2022. The company couldn’t harness the red-hot joint replacement market because of its new business model and ongoing operational challenges.
Conformis’ Platinum Services Program (PSP) is contracted at 225 facilities, representing about 70% of the company’s U.S. business. Even after access is secured, getting the facility to use the program is difficult. The program doesn’t fit customer administrative workflows and requires additional steps. The company equated the process to a capital sale.
Recent trends for the program improved, however. The first quarter saw approximately 500 PSP orders, up from 380 orders in 4Q22 and 110 orders in 1Q22.
“We like the trend and believe it continues to reflect the strong value proposition of our PSP offering,” said Conformis CEO Mark Augusti. “Our commercial team continues to seek creative and effective ways to drive interest and engagement to sell our program to ASC and hospital system in today’s challenging economic climate and a competitive environment that is increasingly focused on robotics.”
Beyond the new business model, Conformis is making strides with its operational inefficiencies. PSP introduced new processes and workflows that are taking longer than expected to integrate.
Moving forward, the company also plans to seek additional partnerships in knee, hip and shoulder to leverage its strong intellectual property.
Orthopedic Sales Data
All orthopedic sales data is provided in USD millions unless otherwise noted. We estimate orthopedic sales and growth on an as-reported basis.
Orthopedic Sales by Segment
| 1Q23 | 1Q22 | $ Chg | % Chg | |
|---|---|---|---|---|
| Joint Replacement | $12.7 | $14.9 | ($2.2) | (14.7%) |
| Knees | $11.9 | $14.1 | ($2.2) | (15.7%) |
| Hips | $0.8 | $0.8 | $0.0 | 3% |
| Other (Royalties) | $0.1 | $0.7 | ($0.5) | (78.1%) |
| Total | $12.8 | $15.6 | ($2.7) | (17.5%) |
Orthopedic Sales by Geography
| 1Q23 | 1Q22 | $ Chg | % Chg | |
|---|---|---|---|---|
| US | $10.7 | $13.4 | ($2.7) | (19.9%) |
| OUS | $2.1 | $2.2 | ($0.0) | (2.1%) |
| Total | $12.8 | $15.6 | ($2.7) | (17.5%) |
Company Earnings
| Amt | % of Sales | |
|---|---|---|
| Sales | $12.8 | |
| Cost of Sales | $7.7 | 60.2% |
| Selling and Marketing | $5.1 | 39.3% |
| General and Admin | $7.0 | 54.7% |
| R & D | $2.5 | 19.1% |
| Other | $0.1 | 1.1% |
| Net Earnings | ($9.6) | (74.6%) |
Conformis reported 1Q23 orthopedic sales of $12.8 million, -17.5% compared to the first quarter of 2022. The company couldn't harness the red-hot joint replacement market because of its new business model and ongoing operational challenges.
Conformis' Platinum Services Program (PSP) is contracted at 225 facilities, representing about 70%...
Conformis reported 1Q23 orthopedic sales of $12.8 million, -17.5% compared to the first quarter of 2022. The company couldn’t harness the red-hot joint replacement market because of its new business model and ongoing operational challenges.
Conformis’ Platinum Services Program (PSP) is contracted at 225 facilities, representing about 70% of the company’s U.S. business. Even after access is secured, getting the facility to use the program is difficult. The program doesn’t fit customer administrative workflows and requires additional steps. The company equated the process to a capital sale.
Recent trends for the program improved, however. The first quarter saw approximately 500 PSP orders, up from 380 orders in 4Q22 and 110 orders in 1Q22.
“We like the trend and believe it continues to reflect the strong value proposition of our PSP offering,” said Conformis CEO Mark Augusti. “Our commercial team continues to seek creative and effective ways to drive interest and engagement to sell our program to ASC and hospital system in today’s challenging economic climate and a competitive environment that is increasingly focused on robotics.”
Beyond the new business model, Conformis is making strides with its operational inefficiencies. PSP introduced new processes and workflows that are taking longer than expected to integrate.
Moving forward, the company also plans to seek additional partnerships in knee, hip and shoulder to leverage its strong intellectual property.
Orthopedic Sales Data
All orthopedic sales data is provided in USD millions unless otherwise noted. We estimate orthopedic sales and growth on an as-reported basis.
Orthopedic Sales by Segment
| 1Q23 | 1Q22 | $ Chg | % Chg | |
|---|---|---|---|---|
| Joint Replacement | $12.7 | $14.9 | ($2.2) | (14.7%) |
| Knees | $11.9 | $14.1 | ($2.2) | (15.7%) |
| Hips | $0.8 | $0.8 | $0.0 | 3% |
| Other (Royalties) | $0.1 | $0.7 | ($0.5) | (78.1%) |
| Total | $12.8 | $15.6 | ($2.7) | (17.5%) |
Orthopedic Sales by Geography
| 1Q23 | 1Q22 | $ Chg | % Chg | |
|---|---|---|---|---|
| US | $10.7 | $13.4 | ($2.7) | (19.9%) |
| OUS | $2.1 | $2.2 | ($0.0) | (2.1%) |
| Total | $12.8 | $15.6 | ($2.7) | (17.5%) |
Company Earnings
| Amt | % of Sales | |
|---|---|---|
| Sales | $12.8 | |
| Cost of Sales | $7.7 | 60.2% |
| Selling and Marketing | $5.1 | 39.3% |
| General and Admin | $7.0 | 54.7% |
| R & D | $2.5 | 19.1% |
| Other | $0.1 | 1.1% |
| Net Earnings | ($9.6) | (74.6%) |
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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.
