How strategic partnerships are driving K2M's growth and why the company isn't afraid of 3D-printing competition

Written by Laura Dyrda | August 02, 2018 | Print  |

K2M released its second quarter financial report, and during the second quarter conference call Chairman, President and CEO Eric Major discussed how the company's partnerships are driving success for the future.

Here are five key quotes from Mr. Major, as transcribed by Seeking Alpha:

On the Brainlab partnership: "We achieved multiple milestone with our Brainlab partnership during the second quarter. First, we completed the engineering work on the compatibility of K2M spinal systems and instrumentation of Brainlab intraoperative, image-guided navigation and imaging platforms. Second, our training of field managers and clinical experts continued at the Chicago Brainlab facility. Third, our commercial teams finished the collaborative development of a targeting strategy so we are ready to launch once regulatory clearances are secured. In fact as early validation of strategy, Brainlab has already been successful in placing units in two new hospital systems."

On 3D-printing competition: "Our Cascade family of products continue to post strong growth in the U.S. as surgeon customers appreciate our differentiated offerings of 3D-printed spinal devices featuring our lamellar 3D titanium technology. We are aware of the increasing number of 3D-printed products from our competitors. But given our market leading position, five-plus years of R&D, knowhow and early commercial entry into the space, we believe we have the engineering and clinical expertise to continue to lead the new frontier of 3D-printed spinal biotechnologies."

Complex spine business: "We believe we are well positioned to continue to gain market share during the 2018 summer deformity season, given the combination of our highly differentiated complex spine product portfolio and our expanded U.S. sales force."

New international partnerships: "Outside the U.S., we have made an important strategic announcement with our distribution partner Medcomtech in Spain and Portugal which we highlighted during our Q1 earnings call in May. This new partnership with Medcomtech improves our position in these markets and gives us greater control over timing and scale of new product introductions going forward."

On profitability: "Despite the softer profitability performance over the first half of 2018, we expect to report improving profitability in the third and fourth quarters and have reaffirmed our full year 2018 adjusted EBITDA guidance of $4 million to $8 million."

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