During Zimmer Biomet's fourth quarter and full year conference call Feb. 1, President and CEO Bryan Hanson addressed several key challenges and opportunities for the company in the coming year.
In 2018, the company reported a 1.7 percent net sales increase to $7.9 billion, with flat fourth quarter knee and hip sales. Zimmer Biomet also projected a potential sales decrease in this year; however, Mr. Hanson discussed the company's plan to boost sales in 2019 and beyond with tools such as robotics and a new partnership with Apple.
Here are key quotes from the call, as transcribed by Seeking Alpha:
Bryan Hanson on 2018 sales: "The last two quarters in 2018 were the best quarters we've had in global large joints in the last two years, which allowed us to reduce the gap to market in 2018. And obviously, although none of us should get too excited about 1 percent growth, we are clearly making progress consistent with our turnaround time."
BH on supply recovery: "As a result of our sustained focus, we successfully reduced back orders in 2018 and increased safety stock levels. We also enhanced the talent and leadership of our manufacturing and operations teams. Importantly today, we no longer consider supply to be a barrier to delivering our financial commitments or stated turnaround time. The next step will be regaining the full trust of our commercial organization, as we shift to offense which I'm confident we will achieve together in 2019."
BH on robotics: "In robotics, we just received FDA clearance for the ROSA Knee, and we look forward to the future clearance of ROSA Spine. Both of these robotic offerings will build on the ROSA platform already cleared for the brain with more than 100 units installed around the world."
"We want to be very disciplined in our approach to launching a new robotic system to make sure that we do it right; we have the right education, and we have the right service levels, and we will do that at limited launch for six months. Post that limited launch is when we move into full launch."
BH on robotics competition from Stryker: "One of our competitors presented just recently here and talked about the continued strength in robotics. That's perfect. I love to hear it because we're just about to launch our robotic platform in a market that is surviving. And when you think about it and the under-penetration of robotics in general, when you think about the number of surgeons that are doing procedures today with our implants, there's very good opportunity for us and we couldn't be more excited about the fact that robotics is getting good traction."
"High-volume surgeons typically had stayed away from robotics because it slows them down and they can't keep the volume of patients that they'd like to have. Our goal is to eliminate that, to be able to get all the accuracy that we got with robotics, but not change the flow of the procedure in a way that would reduce the throughput they could get on patients. That's a big deal because high-volume surgeons [are] who we want because you get mix benefit for every procedure."
BH on 2019 strategy: "We're going to try to convert competitive surgeons. We're going to market directly to patients with a personalized robotic approach, using [the] mymobility app backed by Apple, which has a very strong consumer demand. But I think our biggest opportunity to close the gap is to be able to get the mix benefit in the procedures we already have with the surgeons that we already have."
"We start talking about personalized robotics with digital platforms that have the consumer appeal of Apple that is a pretty unique solution that we can begin to communicate to patients who do their homework on these procedures and potentially begin to deal in some of those patients to our surgeons."