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During our visit to NASS this year, we sat down with Rebecca Whitney, Global Spine President at ZimVie. We talked about the company’s progress in untangling itself from Zimmer Biomet, attractive markets outside of the United States and ZimVie’s medium-term priorities. An excerpt of our conversion follows.
ORTHOWORLD: You’ve been very busy since the March spinoff. Can you give us an update on how things are going in right-sizing the business?
Rebecca Whitney: I’ll say, just to start, that separating out a company is far more complicated than integrating one. Which is a surprise. It took more than a year to take out spine from the DNA of Zimmer Biomet. We found all these places where we were very much entangled. Places we didn’t necessarily expect. Making sure we were set up for success was critical.
I would say we are 80% to 85% percent of the way there. It is going as well as we expected. We do have some lingering things and some cleanup. It doesn’t sound all that exciting or sexy. But, for me personally, I’m an operator. It’s been really rewarding.
ORTHOWORLD: What are the current cleanup priorities?
Whitney: Getting out of countries where we never made money, for example. It is just the reality of being a small spine division in a big company. Stuff just got lost in the shuffle. So getting out of those countries, and then looking at products where we don’t have the profitability. Because of all the integrations, we recognized that a lot of our product portfolio was redundant and quite cluttered. At one point we had 26 pedicle screw systems. We’ve been doing all of this in parallel, and it’s been really fun.
ORTHOWORLD: What makes an OUS territory compelling for ZimVie?
Whitney: We grade different factors like population size and macroeconomic situation. Can they pay for the innovation we bring? Do we think we have the opportunity to both grow and increase profit? Some countries are growing rapidly, but the cost profile doesn’t make sense for us. In some cases, it’s fixing what’s already there. We’ve essentially picked our best bets in each of the regions outside of the United States. For example, Japan is a very healthy country and a good business for us.
ORTHOWORLD: What’s your read on volume-based procurement in China?
Whitney: We bid and learned in late September that we were not selected because we weren’t willing to offer price points that low. We’re in the process of assessing what this means for us. A lot of the multinationals, like Stryker and us, were not selected. It’s tough. There’s still a private sector in China. So, we’re assessing what it would look like if we stayed and whether should we stay, frankly.
ORTHOWORLD: You mentioned how much fun you’re having. What initially attracted you to this opportunity?
Whitney: I’m in an interesting situation. I had been with Zimmer Biomet for years. For the first five years I was with the spine business, so I knew it very well. About three years ago, I moved over to the orthopedic side to start up their ambulatory surgery center business. That’s where I was when they announced the spin and I felt like I had unfished business in spine.
Vafa Jamali, our CEO, called me about two weeks later. He said we’re both here in Boulder, Colorado; let’s talk. Once I got to know him and learned more about what the spin actually meant, I became very intrigued. It felt like we could create our own identity. That was highly appealing to me.
He’s done an excellent job of setting expectations. It would have been very easy for people on the outside to say, ‘You spun out in March; where are the results?’ He’s had a very pragmatic approach and is constantly messaging that this is not a quick flip. We’re building a company the right way. We’re profitable. We’ve got cash. We’re in a situation where we can take our time to be really smart and thoughtful. That’s been refreshing.
ORTHOWORLD: What are some of ZimVie’s medium-term goals once the cleanup is finished?
Whitney: I would say the single biggest advantage that we have is we’re able to look at our portfolio and decide how we want to be known. At Zimmer Biomet, we had an identity crisis for the better part of ten years because of all the acquisitions. We’ve gone back to our roots. We’re not going to compete against everybody and everything. We’re the number six player in this space, so of course, we’re going to have a broad portfolio.
But we think we can really make a difference in spaces where we have a clear right to win, and a leadership position based on our technology. The obvious examples are Mobi-C and our Tether device. But we’re not stopping with what we have today. We’re going all in on motion preservation and anatomy-sparing techniques.
They’re smaller segments, but we do see them growing rapidly. It’s two things with cervical disc replacement. We continue to steal procedures from the typical fusion market, but we’re still very underpenetrated. One out of three patients who are indicated for a cervical disc receives it. Why are they still being fused when there’s a better option?
Frankly, the surgeon makes more money when the patient is fused. It’s not better for the patient and it’s not better for the economics, long term. We’ve got the data to prove it. Fewer subsequent surgeries. The patients are back to work faster. I mean, there are so many benefits. We feel very patient about continuing to drive this mission forward.
ORTHOWORLD: ZimVie just announced Virage navigated instruments. What are ZimVie’s plans around enabling technology?
Whitney: It’s an important first step but it’s not going to be lights out, blow the doors off. Virage allows the systems we have today to be used with whatever technology the surgeon prefers or whatever they have at the facility. It’s a plug-and-play situation that doesn’t disrupt their workflow and allows our implants with their tech.
We’re seeking solutions right now. We have to have a solution in the enabling technology space. We won’t develop it in-house, because it’s not our DNA. We’d have to hire a whole new team of people with different skill sets.
We’re in a nice position, because we’re big enough to have the scale that’s attractive to smaller companies. They’re all looking for homes for their technology. We think it’s a very complementary relationship. Let our engineers focus on what they do best and augment that with something from the outside.
During our visit to NASS this year, we sat down with Rebecca Whitney, Global Spine President at ZimVie. We talked about the company’s progress in untangling itself from Zimmer Biomet, attractive markets outside of the United States and ZimVie’s medium-term priorities. An excerpt of our conversion follows.
ORTHOWORLD: You’ve been very busy...
During our visit to NASS this year, we sat down with Rebecca Whitney, Global Spine President at ZimVie. We talked about the company’s progress in untangling itself from Zimmer Biomet, attractive markets outside of the United States and ZimVie’s medium-term priorities. An excerpt of our conversion follows.
ORTHOWORLD: You’ve been very busy since the March spinoff. Can you give us an update on how things are going in right-sizing the business?
Rebecca Whitney: I’ll say, just to start, that separating out a company is far more complicated than integrating one. Which is a surprise. It took more than a year to take out spine from the DNA of Zimmer Biomet. We found all these places where we were very much entangled. Places we didn’t necessarily expect. Making sure we were set up for success was critical.
I would say we are 80% to 85% percent of the way there. It is going as well as we expected. We do have some lingering things and some cleanup. It doesn’t sound all that exciting or sexy. But, for me personally, I’m an operator. It’s been really rewarding.
ORTHOWORLD: What are the current cleanup priorities?
Whitney: Getting out of countries where we never made money, for example. It is just the reality of being a small spine division in a big company. Stuff just got lost in the shuffle. So getting out of those countries, and then looking at products where we don’t have the profitability. Because of all the integrations, we recognized that a lot of our product portfolio was redundant and quite cluttered. At one point we had 26 pedicle screw systems. We’ve been doing all of this in parallel, and it’s been really fun.
ORTHOWORLD: What makes an OUS territory compelling for ZimVie?
Whitney: We grade different factors like population size and macroeconomic situation. Can they pay for the innovation we bring? Do we think we have the opportunity to both grow and increase profit? Some countries are growing rapidly, but the cost profile doesn’t make sense for us. In some cases, it’s fixing what’s already there. We’ve essentially picked our best bets in each of the regions outside of the United States. For example, Japan is a very healthy country and a good business for us.
ORTHOWORLD: What’s your read on volume-based procurement in China?
Whitney: We bid and learned in late September that we were not selected because we weren’t willing to offer price points that low. We’re in the process of assessing what this means for us. A lot of the multinationals, like Stryker and us, were not selected. It’s tough. There’s still a private sector in China. So, we’re assessing what it would look like if we stayed and whether should we stay, frankly.
ORTHOWORLD: You mentioned how much fun you’re having. What initially attracted you to this opportunity?
Whitney: I’m in an interesting situation. I had been with Zimmer Biomet for years. For the first five years I was with the spine business, so I knew it very well. About three years ago, I moved over to the orthopedic side to start up their ambulatory surgery center business. That’s where I was when they announced the spin and I felt like I had unfished business in spine.
Vafa Jamali, our CEO, called me about two weeks later. He said we’re both here in Boulder, Colorado; let’s talk. Once I got to know him and learned more about what the spin actually meant, I became very intrigued. It felt like we could create our own identity. That was highly appealing to me.
He’s done an excellent job of setting expectations. It would have been very easy for people on the outside to say, ‘You spun out in March; where are the results?’ He’s had a very pragmatic approach and is constantly messaging that this is not a quick flip. We’re building a company the right way. We’re profitable. We’ve got cash. We’re in a situation where we can take our time to be really smart and thoughtful. That’s been refreshing.
ORTHOWORLD: What are some of ZimVie’s medium-term goals once the cleanup is finished?
Whitney: I would say the single biggest advantage that we have is we’re able to look at our portfolio and decide how we want to be known. At Zimmer Biomet, we had an identity crisis for the better part of ten years because of all the acquisitions. We’ve gone back to our roots. We’re not going to compete against everybody and everything. We’re the number six player in this space, so of course, we’re going to have a broad portfolio.
But we think we can really make a difference in spaces where we have a clear right to win, and a leadership position based on our technology. The obvious examples are Mobi-C and our Tether device. But we’re not stopping with what we have today. We’re going all in on motion preservation and anatomy-sparing techniques.
They’re smaller segments, but we do see them growing rapidly. It’s two things with cervical disc replacement. We continue to steal procedures from the typical fusion market, but we’re still very underpenetrated. One out of three patients who are indicated for a cervical disc receives it. Why are they still being fused when there’s a better option?
Frankly, the surgeon makes more money when the patient is fused. It’s not better for the patient and it’s not better for the economics, long term. We’ve got the data to prove it. Fewer subsequent surgeries. The patients are back to work faster. I mean, there are so many benefits. We feel very patient about continuing to drive this mission forward.
ORTHOWORLD: ZimVie just announced Virage navigated instruments. What are ZimVie’s plans around enabling technology?
Whitney: It’s an important first step but it’s not going to be lights out, blow the doors off. Virage allows the systems we have today to be used with whatever technology the surgeon prefers or whatever they have at the facility. It’s a plug-and-play situation that doesn’t disrupt their workflow and allows our implants with their tech.
We’re seeking solutions right now. We have to have a solution in the enabling technology space. We won’t develop it in-house, because it’s not our DNA. We’d have to hire a whole new team of people with different skill sets.
We’re in a nice position, because we’re big enough to have the scale that’s attractive to smaller companies. They’re all looking for homes for their technology. We think it’s a very complementary relationship. Let our engineers focus on what they do best and augment that with something from the outside.
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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.
