Medical products company,
Integra LifeSciences Holdings Corporation
) unveiled its latest device for fixing proximal interphalangeal
(PIP) joint arthrodesis, namely IPP-ON PIP Fusion System. This
product recently received 510(k) clearance from the US Food &
Drug Administration (FDA). Currently, the device is being showcased
at the American Orthopaedic Foot & Ankle Society 2012 Annual
Meeting scheduled from June 20 to June 23, 2012 in California.
The IPP-ON PIP Fusion System is a stainless steel interphalangeal
fusion device, an one-piece alternative to hammertoe fixation.
Hammertoe is a malformation, which occurs due to the shortening of
the tendon that controls toe movement. This new device is
innovative as unlike other devices of similar category, it is not
temperature sensitive and holds no handling and storage
requirements. Currently, IPP-ON PIP Fusion System is available in
two different sizes to support different patient anatomy.
Integra plans to distribute the product through its Extremity
Reconstruction sales organization that mainly works on lower
extremity and upper extremity fixations, tendon protection,
peripheral nerve repair and wound repair. With the growing number
of extremity procedures in recent times arising from increased
patient population, the addition of Ascension and life expectancy,
we believe that this new product development on Integra's part will
accelerate profitability going forward. During the first quarter of
fiscal 2012, the US Extremities revenues of Integra grew 25% year
over year to $26.6 million.
In late 2011, the company acquired Ascension Orthopedics, whose
upper extremity and shoulder implants expanded Integra's orthopedic
portfolio. The acquisition also enabled Integra to utilize
Ascension's proprietary PyroCarbon material, which is used in the
new PyroTITAN implant.
Integra also expects to benefit from a product suite of over 20 new
and differentiated products of Ascension, thus opening the largest
component of the extremities market, estimated at $600 million.
However, over the past few quarters, the challenging macroeconomic
environment in Europe and continued softness in the US has impacted
Integra's overall growth performance. The company is also facing
stiff competition from large cap players like
Johnson & Johnson
) in the orthopedic market.
Although the company is taking several initiatives for
international expansion and pursuing acquisitions to navigate
through these difficulties, the challenging macroeconomic
environment remains a headwind. Currently, Integra retains a Zacks
#3 Rank (short-term Hold). Considering the company's business model
and fundamentals, we have a long-term Neutral recommendation on the
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