Globus Medical, Inc. reported a 12.5% increase in sales for the third quarter on November 1. Total sales were $94.8 million. It was the company’s first quarterly report since going public in August.
Globus Sales Rise 12.5%
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“Globus continued to deliver sales growth in excess of the overall spine market, ” said David Paul, chairman and CEO of the company. Paul said the company’s top line growth was achieved in a challenging spine market. He added that nearly 100% of the company’s sales growth was attributable to internally-driven, organic projects.
Larry Biegelsen of Wells Fargo estimates the global spine market declined 0.1% on a constant currency basis during the quarter, an improvement over the second quarter which declined 0.7% on a constant currency basis.
MIS and Lateral Platform Products
A company press release said the increased sales were driven by growth from “Disruptive Technology” products, including minimally invasive (MIS) and lateral platform products. International sales grew by over 38% and represents 8% of total sales. The company does not break out specific product categories.
Paul noted the company’s first PMA (premarket approval) in September for the Secure-C cervical artificial disc. He also pointed to strong positive cash flow while making significant investments in infrastructure and Algae Therapies, a recently created interventional pain management division..
Merrill Lynch analyst Bob Hopkins wrote the quarter sales numbers were about $500, 000 short of consensus. He attributed the shortfall to delays in bringing on new sales reps and a slow kyphoplasty launch.
Hopkins said the company’s revenue growth over the last seven quarters GMED’s has ranged from 10% in first quarter of 2011 up to 21% by the first quarter of 2012. He says the volatility is a direct function of the company’s business model, which is highly dependent on new product launches and ability to hire new sales reps away from other spine companies. “The company has a solid list of new product launches that will help increase growth rates.”
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This is a fascinating development. In my practice we've seen similar outcomes with the revised protocol. The key differentiator seems to be patient selection criteria. Has anyone else noticed the correlation with BMI thresholds?
Great point. I'd push back slightly on the conclusion, the sample size in the cited study is too small to draw population-level inferences. That said, the directional signal is compelling and worth a larger RCT.
We implemented a similar approach last year. Early results are promising but we're still gathering 12-month follow-up data. Happy to share our protocol if anyone is interested.
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