A New Top 10 Member (well, for next year anyway)

While we (i.e., my colleagues and I) haven’t yet tackled the 2022 ODT Top Companies issue (coming July/August), it’s already known there will be a new name on the list for next year. The Zimmer Biomet spinoff—ZimVie—will make its debut in the 2023 issue. Since the list is generated from the company’s most recent fiscal year, ZimVie won’t appear on this year’s list, but with a projection of $1.0 billion by the end of 2022, the firm should land at number six, seven, or eight, depending on where peers DJO and NuVasive finish financially.

Regardless of position on the list in 2023, on March 1, 2022, the orthopedic device industry saw the official birth of a new spine and dental technologies leader. “At ZimVie, we intend to prioritize innovation and enhanced commercial and operational focus to improve the adoption of our product platforms within the growing $20 billion global dental and spine markets,” Vafa Jamali, president and CEO of ZimVie, said in a news announcement regarding the organization’s inaugural Investor Day. “As an independent company, we will be uniquely positioned to expand the reach of our solutions and execute on opportunities to drive sustainable growth and long-term shareholder value as we bring renewed energy and strategic focus to our brands and products that are trusted all over the world.”

Originally announced on Feb. 5, 2021, the split was intended to enable Zimmer Biomet to enhance its focus on high growth/high priority areas—Knees, Hips, Sports Medicine, Extremities and Trauma (S.E.T.), and Craniomaxillofacial and Thoracic (CMFT). What’s interesting to me is I’ve always viewed knees and hips as well-established, mature technology segments that enjoyed modest year-over-year increases. On the other hand, spine was viewed as a technology sector with a greater opportunity for proliferation. Perhaps the rapid influx of robotic surgical solutions in the knee and hip clinical space has changed the perspective on their growth potential.

Then again, perhaps ZimVie’s prospect for rapid and positive evolution of the spine and dental markets is better achieved as a standalone company. My impression of spine may not be too far off, but currently, the company begins behind the eight ball and will face an uphill climb for a bit. According to Elizabeth Cairns at Evaluate Vantage, ZimVie launches with $561 million in debt. Further, upon its debut, its stock price fell 26 percent and has not since rebounded to its initial offering price.

They company does, however, have the makings for a fantastic foundation. While highlights were shared on the aforementioned Investor Day, there’s a very interesting historical timeline on the firm’s website (www.zimvie.com) that showcases the actions in spine and dental (primarily at Zimmer Biomet) that brings the company to where it is today.

While the timeline begins with the founding of Zimmer in 1927, it rapidly jumps to 2003 when Zimmer acquired Centerpulse to mark its entrance into the spine and dental markets. Following that, in 2008, it acquired Abbott Spine. Meanwhile, Biomet (founded in 1977) had a noted highlight in 2013 when it acquired Lanx and its spinal fusion product lines. In 2015, the two orthopedic leaders merged and in 2016, the newly combined entity grew further with the acquisition of LDR and Medtech S.A., which gave it a leadership position in cervical disc replacement and granted it access to the world of robotic surgery. Implant Concierge was purchased in 2019, enabling entrance into the guided dental surgery services market. Just a year later, 3DIEMME was brought aboard to expand the organization’s digital dentistry portfolio. A couple other moves here and there, and that brings us to today, with ZimVie now a standalone entity.

The Invester Day presentation (available to view at bit.ly/odtzimvie) further reveals the company’s focal segments for the dental and spine sectors. Within dental, the organization offers “fully integrated end-to-end tooth replacement solutions” via dental implants, biomaterials, and digital dentistry. On the spine side, it is equipped with a “comprehensive product portfolio” that includes offerings for core and complex solutions, minimally invasive surgery, motion preservation devices, and bone healing/EBI technologies.

Getting back to rankings (outside of the ODT Top 10 anyway), ZimVie claims it is the #2 global biomaterials company (by revenue). In the spinal space, it considers itself a “market leader in high-growth sub-segments.”

It should be exciting to see how this new player impacts the market. I know we’ll be watching their next actions as an independent company. Do you see any moves you expect them to make or see any potential synergies for their focus in the market? 

Sean Fenske, Editor-in-Chief
[email protected]