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Smith+Nephew reported 2Q22 orthopedic sales of $891.6 million, -4.2% compared to 2Q21.
According to company leadership, challenges from the pandemic hid some pre-existing structural issues with Smith+Nephew’s strategic execution and supply chain reliability.
Recently-appointed CEO Deepak Nath said, “We’ve become more complex and less agile than our larger peers, both in terms of our portfolio and the ways in which we work. We’re still supporting multiple hip stems and knee systems in parallel when peers are increasingly focusing on just one family. We also hadn’t recognized that operations and commercial had become disconnected. The result is that supply is not always well aligned with commercial needs.”
Nath said that the majority Smith+Nephew trauma sales representatives spend up to 40% of their time managing logistics and inventory.
The company has embarked upon a comprehensive program to resolve its issues. For its orthopedics business, Smith+Nephew will “rewire” its commercial delivery, streamline its portfolio by retiring certain product families and rebuild its demand planning process.
Smith+Nephew leadership remains confident in the company’s “right to win,” highlighting its full range of knee and hip implants, the CORI robotic system and its comprehensive sports medicine offerings bolstered by deep customer relationships.
The company will have to implement its fixes amid an environment that is still fraught with disruption. Volume-based purchasing in China had a negative $20 million impact for Smith+Nephew in the second quarter, and COVID lockdowns there hurt demand for sports medicine. The company declined to participate in provincial VBP tenders for trauma, which negatively impacted those sales in the quarter.
Smith+Nephew maintained its full-year 2022 guidance for underlying growth at +4% to +5% for total revenue.
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 | |
|---|---|---|---|---|
| Joint Replacement | $412.1 | $426.5 | ($14.4) | (3.4%) |
| Knees | $245.5 | $247.2 | ($1.7) | (0.7%) |
| Hips | $149.0 | $161.4 | ($12.4) | (7.7%) |
| Extremities | $17.6 | $17.8 | ($0.2) | (1.3%) |
| Trauma | $117.7 | $130.7 | ($13.0) | (9.9%) |
| Sports Medicine | $345.7 | $358.0 | ($12.3) | (3.4%) |
| Orthobiologics | $16.1 | $15.8 | $0.2 | 1.5% |
| Total | $891.6 | $931.0 | ($39.4) | (4.2%) |
| 1H22 | 1H21 | $ Chg | % Chg | |
|---|---|---|---|---|
| Joint Replacement | $829.7 | $835.3 | ($5.6) | (0.7%) |
| Knees | $496.5 | $484.2 | $12.3 | 2.5% |
| Hips | $298.0 | $315.4 | ($17.4) | (5.5%) |
| Extremities | $35.2 | $35.7 | ($0.5) | (1.4%) |
| Trauma | $241.1 | $261.8 | ($20.7) | (7.9%) |
| Sports Medicine | $706.7 | $702.0 | $4.7 | 0.7% |
| Orthobiologics | $30.2 | $29.8 | $0.5 | 1.6% |
| Total | $1,807.7 | $1,828.9 | ($21.2) | (1.2%) |
Orthopedic Sales by Geography
| 2Q22 | 2Q21 | $ Chg | % Chg | |
|---|---|---|---|---|
| US | $475.8 | $472.1 | $3.7 | 0.8% |
| OUS | $415.8 | $458.9 | ($43.1) | (9.4%) |
| EMEA | $221.8 | $250.1 | ($28.4) | (11.3%) |
| Asia Pacific | $93.0 | $111.7 | ($18.7) | (16.8%) |
| Rest of World | $101.0 | $97.0 | $4.0 | 4.2% |
| Total | $891.6 | $931.0 | ($39.4) | (4.2%) |
| 1H22 | 1H21 | $ Chg | % Chg | |
|---|---|---|---|---|
| US | $938.1 | $926.8 | $11.3 | 1.2% |
| OUS | $869.7 | $902.1 | ($32.5) | (3.6%) |
| EMEA | $465.5 | $495.9 | ($30.4) | (6.1%) |
| Asia Pacific | $195.2 | $217.7 | ($22.5) | (10.3%) |
| Rest of World | $209.0 | $188.5 | $20.4 | 10.8% |
| Total | $1,807.7 | $1,828.9 | ($21.2) | (1.2%) |
Smith+Nephew reported 2Q22 orthopedic sales of $891.6 million, -4.2% compared to 2Q21.
According to company leadership, challenges from the pandemic hid some pre-existing structural issues with Smith+Nephew's strategic execution and supply chain reliability.
Recently-appointed CEO Deepak Nath said, "We've become more complex and less...
Smith+Nephew reported 2Q22 orthopedic sales of $891.6 million, -4.2% compared to 2Q21.
According to company leadership, challenges from the pandemic hid some pre-existing structural issues with Smith+Nephew’s strategic execution and supply chain reliability.
Recently-appointed CEO Deepak Nath said, “We’ve become more complex and less agile than our larger peers, both in terms of our portfolio and the ways in which we work. We’re still supporting multiple hip stems and knee systems in parallel when peers are increasingly focusing on just one family. We also hadn’t recognized that operations and commercial had become disconnected. The result is that supply is not always well aligned with commercial needs.”
Nath said that the majority Smith+Nephew trauma sales representatives spend up to 40% of their time managing logistics and inventory.
The company has embarked upon a comprehensive program to resolve its issues. For its orthopedics business, Smith+Nephew will “rewire” its commercial delivery, streamline its portfolio by retiring certain product families and rebuild its demand planning process.
Smith+Nephew leadership remains confident in the company’s “right to win,” highlighting its full range of knee and hip implants, the CORI robotic system and its comprehensive sports medicine offerings bolstered by deep customer relationships.
The company will have to implement its fixes amid an environment that is still fraught with disruption. Volume-based purchasing in China had a negative $20 million impact for Smith+Nephew in the second quarter, and COVID lockdowns there hurt demand for sports medicine. The company declined to participate in provincial VBP tenders for trauma, which negatively impacted those sales in the quarter.
Smith+Nephew maintained its full-year 2022 guidance for underlying growth at +4% to +5% for total revenue.
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 | |
|---|---|---|---|---|
| Joint Replacement | $412.1 | $426.5 | ($14.4) | (3.4%) |
| Knees | $245.5 | $247.2 | ($1.7) | (0.7%) |
| Hips | $149.0 | $161.4 | ($12.4) | (7.7%) |
| Extremities | $17.6 | $17.8 | ($0.2) | (1.3%) |
| Trauma | $117.7 | $130.7 | ($13.0) | (9.9%) |
| Sports Medicine | $345.7 | $358.0 | ($12.3) | (3.4%) |
| Orthobiologics | $16.1 | $15.8 | $0.2 | 1.5% |
| Total | $891.6 | $931.0 | ($39.4) | (4.2%) |
| 1H22 | 1H21 | $ Chg | % Chg | |
|---|---|---|---|---|
| Joint Replacement | $829.7 | $835.3 | ($5.6) | (0.7%) |
| Knees | $496.5 | $484.2 | $12.3 | 2.5% |
| Hips | $298.0 | $315.4 | ($17.4) | (5.5%) |
| Extremities | $35.2 | $35.7 | ($0.5) | (1.4%) |
| Trauma | $241.1 | $261.8 | ($20.7) | (7.9%) |
| Sports Medicine | $706.7 | $702.0 | $4.7 | 0.7% |
| Orthobiologics | $30.2 | $29.8 | $0.5 | 1.6% |
| Total | $1,807.7 | $1,828.9 | ($21.2) | (1.2%) |
Orthopedic Sales by Geography
| 2Q22 | 2Q21 | $ Chg | % Chg | |
|---|---|---|---|---|
| US | $475.8 | $472.1 | $3.7 | 0.8% |
| OUS | $415.8 | $458.9 | ($43.1) | (9.4%) |
| EMEA | $221.8 | $250.1 | ($28.4) | (11.3%) |
| Asia Pacific | $93.0 | $111.7 | ($18.7) | (16.8%) |
| Rest of World | $101.0 | $97.0 | $4.0 | 4.2% |
| Total | $891.6 | $931.0 | ($39.4) | (4.2%) |
| 1H22 | 1H21 | $ Chg | % Chg | |
|---|---|---|---|---|
| US | $938.1 | $926.8 | $11.3 | 1.2% |
| OUS | $869.7 | $902.1 | ($32.5) | (3.6%) |
| EMEA | $465.5 | $495.9 | ($30.4) | (6.1%) |
| Asia Pacific | $195.2 | $217.7 | ($22.5) | (10.3%) |
| Rest of World | $209.0 | $188.5 | $20.4 | 10.8% |
| Total | $1,807.7 | $1,828.9 | ($21.2) | (1.2%) |
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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.
