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OrthoPediatrics reported 2Q22 orthopedic sales of $32.9 million, +23.3% compared to 2Q21.
Procedure volumes started slowly in the second quarter but accelerated in June and into July. OrthoPediatrics expects that it currently has a $2.5 million backlog that will be recaptured before the end of the year.
The company placed its first 7D navigation system at St. Mary’s Hospital and West Palm Beach, Florida, and has several units going through value analysis committees elsewhere. These systems are typically in hospitals where OrthoPediatrics has low market share and represent a significant opportunity for implant pull-through.
The recently acquired MD Orthopedics (MDO) contributed $2.6 million in revenue for the quarter, aided by international stocking orders. OrthoPediatrics expects a run rate of about $1.7 million for the next two quarters. Pega Medical, the company’s other recent purchase, helped OrthoPediatrics clear a hurdle on its way to being able to treat 90% of pediatric trauma and deformity cases.
Pega Medical represents a longer-term play for the company and has implications for contracting with key hospital systems. OrthoPediatrics CEO David Bailey said, “We’ve talked about this moving us from about 85% of what a pediatric orthopedic surgeon does to 90%. That last 5% is a big one because this product line opens us up into an area of the market for children’s with children with rare bone diseases. Given the fact that Pega’s FD rod is unique in that there’s really no competition, particularly in the United States for it, gives us a pretty powerful position when you include those products into the balance of our portfolio for hospital contracting.”
It sounds as though OrthoPediatrics is done on the M&A front for the next two years. With two ongoing integrations, the company said that there are currently no remaining attractive assets in the pediatric space.
The company increased its 2022 revenue guidance to the range of $127 million to $130 million, representing growth between 30% and 33%. The guidance assumes $6 million from MDO and $3 million from Pega Medical.
Orthopedic Sales Data
All orthopedic sales data is provided in USD millions unless otherwise noted. Orthopedic sales and growth rates are estimated on an as-reported basis.
Orthopedic Sales by Segment
| 2Q22 | 2Q21 | $ Chg | % Chg | |
|---|---|---|---|---|
| Spine | $9.4 | $7.7 | $1.8 | 23% |
| Trauma | $22.6 | $17.9 | $4.6 | 25.8% |
| Sports Medicine | $0.9 | $1.1 | ($0.2) | (15%) |
| Total | $32.9 | $26.7 | $6.2 | 23.3% |
| 1H22 | 1H21 | $ Chg | % Chg | |
|---|---|---|---|---|
| Spine | $15.4 | $13.6 | $1.8 | 13.2% |
| Trauma | $39.1 | $32.5 | $6.6 | 20.3% |
| Sports Medicine | $1.9 | $2.1 | ($0.2) | (10%) |
| Total | $56.3 | $48.2 | $8.2 | 17% |
Orthopedic Sales by Geography
| 2Q22 | 2Q21 | $ Chg | % Chg | |
|---|---|---|---|---|
| US | $25.0 | $21.7 | $3.2 | 14.8% |
| OUS | $8.0 | $5.0 | $3.0 | 60.7% |
| Total | $32.9 | $26.7 | $6.2 | 23.3% |
| 1H22 | 1H21 | $ Chg | % Chg | |
|---|---|---|---|---|
| US | $43.1 | $38.6 | $4.6 | 11.9% |
| OUS | $13.2 | $9.6 | $3.6 | 37.7% |
| Total | $56.3 | $48.2 | $8.2 | 17% |
Company Earnings
| Amt | % of Sales | |
|---|---|---|
| Sales | $32.9 | |
| Cost of Sales | $7.9 | 24.1% |
| General and Admin | $12.4 | 37.8% |
| Selling and Marketing | $14.5 | 44.2% |
| R & D | $1.7 | 5.3% |
| Other | $9.0 | 27.4% |
| Net Earnings | ($0.3) | (1%) |
OrthoPediatrics reported 2Q22 orthopedic sales of $32.9 million, +23.3% compared to 2Q21.
Procedure volumes started slowly in the second quarter but accelerated in June and into July. OrthoPediatrics expects that it currently has a $2.5 million backlog that will be recaptured before the end of the year.
The company placed its first 7D...
OrthoPediatrics reported 2Q22 orthopedic sales of $32.9 million, +23.3% compared to 2Q21.
Procedure volumes started slowly in the second quarter but accelerated in June and into July. OrthoPediatrics expects that it currently has a $2.5 million backlog that will be recaptured before the end of the year.
The company placed its first 7D navigation system at St. Mary’s Hospital and West Palm Beach, Florida, and has several units going through value analysis committees elsewhere. These systems are typically in hospitals where OrthoPediatrics has low market share and represent a significant opportunity for implant pull-through.
The recently acquired MD Orthopedics (MDO) contributed $2.6 million in revenue for the quarter, aided by international stocking orders. OrthoPediatrics expects a run rate of about $1.7 million for the next two quarters. Pega Medical, the company’s other recent purchase, helped OrthoPediatrics clear a hurdle on its way to being able to treat 90% of pediatric trauma and deformity cases.
Pega Medical represents a longer-term play for the company and has implications for contracting with key hospital systems. OrthoPediatrics CEO David Bailey said, “We’ve talked about this moving us from about 85% of what a pediatric orthopedic surgeon does to 90%. That last 5% is a big one because this product line opens us up into an area of the market for children’s with children with rare bone diseases. Given the fact that Pega’s FD rod is unique in that there’s really no competition, particularly in the United States for it, gives us a pretty powerful position when you include those products into the balance of our portfolio for hospital contracting.”
It sounds as though OrthoPediatrics is done on the M&A front for the next two years. With two ongoing integrations, the company said that there are currently no remaining attractive assets in the pediatric space.
The company increased its 2022 revenue guidance to the range of $127 million to $130 million, representing growth between 30% and 33%. The guidance assumes $6 million from MDO and $3 million from Pega Medical.
Orthopedic Sales Data
All orthopedic sales data is provided in USD millions unless otherwise noted. Orthopedic sales and growth rates are estimated on an as-reported basis.
Orthopedic Sales by Segment
| 2Q22 | 2Q21 | $ Chg | % Chg | |
|---|---|---|---|---|
| Spine | $9.4 | $7.7 | $1.8 | 23% |
| Trauma | $22.6 | $17.9 | $4.6 | 25.8% |
| Sports Medicine | $0.9 | $1.1 | ($0.2) | (15%) |
| Total | $32.9 | $26.7 | $6.2 | 23.3% |
| 1H22 | 1H21 | $ Chg | % Chg | |
|---|---|---|---|---|
| Spine | $15.4 | $13.6 | $1.8 | 13.2% |
| Trauma | $39.1 | $32.5 | $6.6 | 20.3% |
| Sports Medicine | $1.9 | $2.1 | ($0.2) | (10%) |
| Total | $56.3 | $48.2 | $8.2 | 17% |
Orthopedic Sales by Geography
| 2Q22 | 2Q21 | $ Chg | % Chg | |
|---|---|---|---|---|
| US | $25.0 | $21.7 | $3.2 | 14.8% |
| OUS | $8.0 | $5.0 | $3.0 | 60.7% |
| Total | $32.9 | $26.7 | $6.2 | 23.3% |
| 1H22 | 1H21 | $ Chg | % Chg | |
|---|---|---|---|---|
| US | $43.1 | $38.6 | $4.6 | 11.9% |
| OUS | $13.2 | $9.6 | $3.6 | 37.7% |
| Total | $56.3 | $48.2 | $8.2 | 17% |
Company Earnings
| Amt | % of Sales | |
|---|---|---|
| Sales | $32.9 | |
| Cost of Sales | $7.9 | 24.1% |
| General and Admin | $12.4 | 37.8% |
| Selling and Marketing | $14.5 | 44.2% |
| R & D | $1.7 | 5.3% |
| Other | $9.0 | 27.4% |
| Net Earnings | ($0.3) | (1%) |
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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.
