Conformis’ Surprising Strategic Shift to Standard Knee Implants

Will Conformis inadvertently diminish the value of its customized knee implants it’s known for by adding a “standard” knee to its portfolio?

The orthopedic company known for its customized knee implants now plans to sell a standard off-the-shelf knee in parallel to its higher-cost customized knee implants.

Ryan Zimmerman, a medtech analyst at BTIG, says the benefits will be a lower average selling price and faster lead times, but he worries it could diminish the value of the customized knee implants.

“This may open a few doors in [ambulatory surgery centers], but we worry it will also poke holes in the case for knee customization, which has been foundational for [Conformis] since inception,” Zimmerman said in an investment report. “All told, it will take considerable resources and time to build this strategy.”

Conformis has taken a hard hit during the pandemic. In March the company had to furlough 80 employees (about one-third of its workforce) due to a sharp decline in elective procedures. In April, the company received a $4.7 million loan through the Paycheck Protection Program, and was able to bring most of its furloughed staff back to work.

Conformis CEO Mark Augusti said the second quarter was also impacted by the pandemic, but the company has seen a “fairly quick” resumption of scheduled orthopedic procedures, going from April when the company was down 94%, to being down 39% in May, and then down just 9% in June.

“Conformis does not have any revision, oncology, or trauma orthopedic products that are considered essential surgery,” Augusti said during the company’s second-quarter earnings call, according to Seeking Alpha transcripts. “Therefore, we are heavily weighted towards pure primary elective total joint replacement.”

By Amanda Pedersen | MD+DI

Image Credit: New York Times


About Peter Coffaro 510 Articles
Peter Coffaro is a growth-driven and strategic executive with over 25 years of progressive management success in the medical device industry. With a proven track record and recognized expertise, Peter has established himself as one of the top influencers in medical sales, as acknowledged by prestigious publications such as the World Journal of Orthopedics, Exponential Healthtech, and Throughout his career, Peter has accumulated 10 years of combined sales management experience, excelling in various roles including Director, General Manager, Distributor, and Vice President. He has worked for industry-leading orthopedic companies such as Zimmer, DePuy, and Stryker, solidifying his deep knowledge and network within the field. Peter’s passion for innovation and emerging technologies led him to found OrthoFeed, an award-winning blog covering digital orthopedic news and emerging medical technologies. Through this platform, he stays at the forefront of the industry and contributes to the dissemination of valuable insights. Peter is a three-time Hall of Fame award winner at Johnson and Johnson, demonstrating his exceptional contributions and impact on the organization. His expertise extends to areas such as organizational development, business development, sales management, digital marketing, and professional education. Peter earned a B.S. degree in Biology and Chemistry from Northern Illinois University, further complementing his comprehensive understanding of the medical field. With his wealth of experience, strategic mindset, and dedication to advancing healthcare, Peter Coffaro is a valuable asset and leader in the medical device industry.

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