Robert J. Palmisano, President and CEO
Lance A. Berry, Sr. VP and CFO
Robert P. Burrows, Sr. VP, Supply Chain
J. Wesley Porter, Sr. VP and Chief Compliance Officer
Julie D. Tracy, Sr. VP and Chief Communications Officer
Jennifer S. Walker, Sr. VP, Process Improvement
Kevin D. Cordell, President, U.S.
Peter S. Cooke, President, International
Timothy L. Lanier, President, Upper Extremities
Patrick Fisher, President, Lower Extremities
NUMBER OF EMPLOYEES: 2,675
GLOBAL HEADQUARTERS: Memphis, Tenn.; Staines-upon-Thames, U.K.
Metal-on-metal (MoM) hip implants came under fire several years ago after a number of foreign registries uncovered higher than average failure rates. As far back as April 2010, the U.K.’s Medicines and Healthcare products Regulatory Agency (MHRA) issued an alert urging patients with painful MoM hip replacements to undergo blood tests and imaging to assess the extent of the damage.
By May 2011, the FDA mandated manufacturers of MoM hip implants conduct postmarket surveillance. All the while, thousands of lawsuits were filed against the largest manufacturers by patients alleging injury. Some of the maligned MoM hips included Zimmer’s Durom Hip Cup (290 cases), DePuy’s ASR (8,858 cases) and Pinnacle hip implants (5,153 cases), and Biomet’s M2a Magnum hip implant (978 cases). DePuy even ended up reaching a multi-billion-dollar settlement with affected ASR implant patients.
The problem with the MoM hips was that the metal ball and cup slide against each other while walking or running, or else metal was being released from other parts of the implant where components connected. Metal release caused tiny metal particles to wear off the device into the space around the implant. Wear and corrosion was also found to occur at the junction between the metal ball and taper of the stem. Some of the metal ions—cobalt and chromium—from the implant or released particles then entered the bloodstream. Over time, the metal around some implants caused damage to bone and/or tissue surrounding the implant and joint.
Wright Medical was embroiled in MoM hip implant legal proceedings for its Conserve implant beginning in 2012. The company had previously settled 1,300 product liability lawsuits in November 2016 for $240 million—and saw its shares climb nearly 4 percent after the announcement.
Following an Atlanta, Ga., federal bellwether trial that resulted in Wright paying retired ski instructor Robyn Christiansen $11 million, last October the company inked an $89 million comprehensive deal to settle all the remaining claims. The payouts will come in three tranches. The first for $7.9 million for certain claimants, the second for $5.1 million for the oldest claims, and $76.75 million for the rest. The final payment is scheduled for September 2019.
Wright Medical is no longer in hip or knee businesses after selling them to MicroPort Scientific in 2013, in order to pursue the higher growth markets of extremities and biologics. And the firm fortified its arsenal in this space by acquiring IMASCAP SAS for $89 million last December, bringing its software-based solutions for preoperative shoulder surgery planning into the fold.
IMASCAP’s Glenosys is the pre-op planning software behind Wright’s Blueprint 3D planning software, which allows simulation of a shoulder prosthesis’ position using CT imaging data. That way, the surgeon can visualize the shoulder in 3D and rotate through the entire range of motion in any direction. Then, prior to the surgery, the surgeon can optimize the plan adapted to the patient to choose the most apt implant. This virtual surgical plan benefits patients and clinicians alike by potentially reducing surgical time, generating improved outcomes, and bringing about less inventory.
“Wright, and previously Tornier, has been involved with IMASCAP for many years with our BLUEPRINT case planning software, and we have seen first-hand the innovation, creativity, and differentiated solutions the IMASCAP team has developed,” Wright CEO Robert Palmisano said in announcing the acquisition. “Software-enhanced solutions are the future, and with the acquisition of IMASCAP, we have the opportunity to take a significant lead in this area.”
IMASCAP had no revenues, so there was no measureable impact on the company’s $745 million of sales in fiscal 2017 (ended Dec. 31). Nevertheless, Wright continued its pattern of growth into this year, as last year’s proceeds represented an 8 percent rise over the prior year. This was chiefly driven by the company’s Upper extremities business, which generated $333 million last year, an impressive 16 percent revenue expansion.
Wright’s shoulder portfolio was the chief driver of this growth, thanks in part to last year’s release of the Aequalis Perform Reversed Glenoid System, which is designed to primarily address posterior glenoid deficiencies and deliver bone preservation via defect-mimicking augments. Shoulder fixation is accomplished via Perform’s central and peripheral screws, as well as the company’s proprietary Adaptis Integrated Porous Metal. The circular design and independent central screw also allows for an infinitely dialable construct.
The upper extremities business outpaced lower extremities for perhaps the first time in the company’s history. The segment was flat last year with $286 million in sales, only rising a slight $880,000 from the previous year. Hiring and training about 100 new direct quota-carrying domestic sales representatives and lower international sales volumes dragged the business down, despite a 17 percent hike in ankle replacement sales from new ankle products introduced at last year’s American Orthopaedic Foot and Ankle Society (AOFAS) annual meeting.
The Invision Total Ankle Revision System was developed specifically for total ankle revision arthroplasty. It can be leveraged as a standalone construct or in conjunction with Wright’s Infinity and Inbone components. Invision Total Ankle helps surgeons rebuild bone lost through previous surgeries and provides modularity to help restore natural joint height.
The Ortholoc 3Di Ankle Fracture Low Profile System offers a complete range of ankle fracture plates for the foot and ankle surgeon. With low-profile, anatomic plate designs and polyaxial screw locking, Ortholoc 3Di addresses a major need for one of the foot and ankle’s largest market segments. The Ortholoc 3Di Small Bone Plating System, the comprehensive plating solution designed to address metatarsal fractures—and named differently than what was announced at AOFAS—was formally launched last December.
The Mica Minimally-Invasive Foot & Ankle System was, at the time, the first minimally invasive solution specifically designed for foot and ankle surgery. The implants and instrumentation are explicitly meant for percutaneous foot surgery. The system can be used to treat multiple pathologies, including bunions, one of the most common orthopedic issues involving the foot.
The biologics business netted proceeds of $101 million last year, expanding 8 percent. International sales were particularly fruitful for this area with a healthy 18 percent upturn. This overseas surge was provoked primarily by new stocking distributors and accounts in China, and favorable impact from foreign currency exchange rates. Continued sales volume growth of the Augment Bone Graft also helped this segment continue its pattern of profitability.
Wright’s sports medicine and other business—composed of products used across several anatomic sites to mechanically repair tissue-to-tissue or tissue-to-bone injuries, and other ancillary products—posted $23 million in 2017, remaining flat from the year prior. Interestingly, this segment is the sole Wright business that garners more international sales than domestic—$15 million vs. $8 million.