Release Date: October 24, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Bonesupport Holding AB (BOEUF, Financial) reported a significant sales growth of over 50% year-on-year, reaching SEK238 million in Q3 2024.
- The company achieved a record operating result of SEK48 million before incentive provisions, with a reported EBIT of SEK41 million.
- Cerament G in the US experienced a remarkable 114% year-over-year growth, now accounting for 50% of total sales in the quarter.
- The Solario study, which has been ongoing for over four years, showed positive outcomes, potentially leading to modified treatment protocols and reduced systemic antibiotic use.
- Bonesupport Holding AB (BOEUF) is making good progress in preparing for market entry into the spinal fusion segment, with several preclinical studies underway.
Negative Points
- There was a higher-than-expected negative seasonality impact in Europe, exacerbated by healthcare staffing disruptions, leading to fewer surgeries and challenging market access.
- Sales and marketing expenses increased significantly, amounting to SEK102 million compared to SEK67.6 million the previous year.
- The gross margin dropped slightly due to a weaker US dollar, although it remained strong at 94.7%.
- The company faces challenges in training surgeons and nurses, with only 1,000 out of 20,000 US orthopedic surgeons trained on Cerament G so far.
- Despite strong sales growth, there is potential for disruptions in hospital systems that could temporarily halt the use of Cerament G.
Q & A Highlights
Q: Can you discuss the speed at which behaviors might change regarding the use of systemic antibiotics versus Cerament G and V, especially in Europe and the US?
A: Emil Billback, CEO: It's challenging to predict the speed of change in behaviors, especially among conservative customer groups. However, the Solario study, which is not our study but conducted by the European Bone and Joint Infection Society, could facilitate change. There's a global trend towards more balanced antibiotic use, driven by organizations like the UN and WHO. In the US, changes might occur faster due to the financial impact on healthcare systems, alongside patient outcomes.
Q: What share of extremity surgeries should use local antibiotics in the long term?
A: Emil Billback, CEO: The use of local antibiotics is expected to rise both in Europe and the US. Currently, it's around 38% in the US and 47% in Europe. Long-term, this could increase to 60% or more, driven by the shift from autografts to synthetic grafts and the evidence supporting local antibiotics.
Q: How sticky is the customer base for Cerament G in the US, and what growth is coming from new versus existing customers?
A: Emil Billback, CEO: The customer base is very sticky once surgeons see the results, which takes 3 to 6 months. Loyalty is high among trained surgeons, and while training is a lengthy process, those who have been trained tend to continue using the product. Growth is driven by both existing and new customers, with a strong endorsement from surgeon-to-surgeon referrals.
Q: How will the Solario study impact the use of Cerament if patients with bone infections are already receiving local antibiotics?
A: Emil Billback, CEO: Solario shows that systemic antibiotic treatment can be significantly shortened with the use of antibiotic-eluting bone grafts like Cerament G and V. While local antibiotics are used, Cerament offers regulatory approval and superior clinical results, which could drive increased adoption.
Q: What are the plans for Cerament in the spinal fusion market, and is there a focus on Cerament G or V?
A: Emil Billback, CEO: The focus is initially on Cerament BVF, with plans to develop data for Cerament G in spinal fusion. The work on Cerament BVF lays the foundation for Cerament G, and the company is exploring various techniques and monitoring outcomes to support future applications.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
