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Exactech (EXAC) has restructured its Spine & Biologics segment, divested its spine product assets to ChoiceSpine and announced restructuring charges related to ex-U.S. operations. Terms were not disclosed.
The transaction allows EXAC to focus on joint reconstruction in hip, knee and extremities, including shoulder and ankle.
EXAC’s spinal products encompassed cervical, thoracolumbar and interbody implants and minimally invasive instrument systems. ChoiceSpine also gains distribution channels in Germany, Portugal and Spain, adding to its present partners in Italy and Mexico.
For 2015, EXAC reported combined Spine & Biologics revenue of US $22.9MM, representing 9.4% of 2015 overall sales of $242.2MM. Of that, ORTHOWORLD estimates that 2015 Spine sales comprised 4.1% of 2015 revenue at ~$10.0MM, which was a +3.7% increase vs. 2014. Throughout 2016, however, Spine revenue growth decreased sequentially, ending 3Q16 at -18.9% vs. 3Q15, by ORTHOWORLD estimates.
In its 3Q16 call, company leadership noted headwinds to its spine revenue such as a small customer base, making that business somewhat volatile with respect to surgeons taking vacations and slower-than-intended adoption of products.
Per EXAC, the restructuring initiative and losses on the impairment of Spine and Biologics assets, including goodwill and spine assets sold, will incur a pre-tax charge to 2016 earnings in the range of $15.0MM to $17.0MM. EXAC expects 2017 revenue in the range of $264.0MM to $272.0MM.
Additional restructuring details are expected during the company’s 2016 year-end earnings call on Tuesday, February 21.
ChoiceSpine formed in 2006 after acquiring the assets of Orthotec. Today, it is a privately-held 45-employee company marketing cervical, thoracolumbar and interbody devices, with an annual revenue range of $30.0MM to $45.0MM. In 1Q15, ChoiceSpine picked up Baxano’s VEO Lateral Access/Interbody Fusion system; that product received CE Mark approval in late 3Q15.
Sources: ChoiceSpine; Exactech, Inc.; ORTHOWORLD Inc.
Exactech (EXAC) has restructured its Spine & Biologics segment, divested its spine product assets to ChoiceSpine and announced restructuring charges related to ex-U.S. operations. Terms were not disclosed.
The transaction allows EXAC to focus on joint reconstruction in hip, knee and extremities, including shoulder and ankle.
...
Exactech (EXAC) has restructured its Spine & Biologics segment, divested its spine product assets to ChoiceSpine and announced restructuring charges related to ex-U.S. operations. Terms were not disclosed.
The transaction allows EXAC to focus on joint reconstruction in hip, knee and extremities, including shoulder and ankle.
EXAC’s spinal products encompassed cervical, thoracolumbar and interbody implants and minimally invasive instrument systems. ChoiceSpine also gains distribution channels in Germany, Portugal and Spain, adding to its present partners in Italy and Mexico.
For 2015, EXAC reported combined Spine & Biologics revenue of US $22.9MM, representing 9.4% of 2015 overall sales of $242.2MM. Of that, ORTHOWORLD estimates that 2015 Spine sales comprised 4.1% of 2015 revenue at ~$10.0MM, which was a +3.7% increase vs. 2014. Throughout 2016, however, Spine revenue growth decreased sequentially, ending 3Q16 at -18.9% vs. 3Q15, by ORTHOWORLD estimates.
In its 3Q16 call, company leadership noted headwinds to its spine revenue such as a small customer base, making that business somewhat volatile with respect to surgeons taking vacations and slower-than-intended adoption of products.
Per EXAC, the restructuring initiative and losses on the impairment of Spine and Biologics assets, including goodwill and spine assets sold, will incur a pre-tax charge to 2016 earnings in the range of $15.0MM to $17.0MM. EXAC expects 2017 revenue in the range of $264.0MM to $272.0MM.
Additional restructuring details are expected during the company’s 2016 year-end earnings call on Tuesday, February 21.
ChoiceSpine formed in 2006 after acquiring the assets of Orthotec. Today, it is a privately-held 45-employee company marketing cervical, thoracolumbar and interbody devices, with an annual revenue range of $30.0MM to $45.0MM. In 1Q15, ChoiceSpine picked up Baxano’s VEO Lateral Access/Interbody Fusion system; that product received CE Mark approval in late 3Q15.
Sources: ChoiceSpine; Exactech, Inc.; ORTHOWORLD Inc.
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JV
Julie Vetalice is ORTHOWORLD's Editorial Assistant. She has covered the orthopedic industry for over 20 years, having joined the company in 1999.
