Alphatec announced on October 27 that it had sold 14.3 million shares at $10.50 per share, raising $150 million.
Alphatec Raises $150 Million in New Capital
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Since 2019, the company has raised, not counting the current offering, $356 million in four different tranches. Including the current offering, the total funds raised since 2019 from stock sales is just over $506 million.
Alphatec’s market value is currently standing at $1.27 billion—$9.27 per share, 137 million shares outstanding.
As we noted in this week’s newsletter Power Rankings, this is a bear market for orthopedic and spine company equities. Over the last 30 days of the 22 orthopedic and spine companies we track, only one increased in value (Bioventus)—all the rest declined.
Over the past 30 days, Alphatec’s market value has declined about 28%.
As we’ve noted both in other articles and from the podium on several occasions, Alphatec has been the top market share gainer for three of the past four years. And yet, investors appear unimpressed.
Indeed, with cash becoming increasingly expensive, international conflicts metastasizing and Wall Street’s natural inclination to over-react, this may well have been one of the worst markets in which to float a stock sale.
Alphatec Sales Growing 30+% Year-Over-Year
For the most recent quarter ending September 30, 2023, the company provided investors with the following guidance:
- “Third quarter 2023 total revenue of $117.7 million to $118.5 million, implying total revenue growth of 31 to 32%.
- Third quarter 2023 adjusted EBITDA of $1.5 million to $2.3 million.
- Full-year 2023 total revenue of approximately $472 million.”
Which will likely make Alphatec the #1 market share gainer yet again for both the third quarter and full year 2023.
The investment banks that managed this latest stock offering were Morgan Stanley, TD Cowen, Barclays and Stifel.
Of course, just prior to both this stock sale and the earnings announcement, CEO Pat Miles significantly beefed up his board and advisor ranks with the additions of David Demski and Keith Valentine. It’s truly a “Dream Team” which is now helping Miles maintain this industry-leading sales growth rate while also finding a way to raise cash the old fashioned way—with earnings.
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Discussion
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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