Medical Design Briefs - April 2024 - 7
Performance and Pipeline
Zimmer Biomet experienced a successful
year in 2023, with notable
achievements such as revenue growth of
7.5 percent, adjusted earnings per share
growth of almost 9.5 percent, and generating
nearly a billion dollars in free cash
flow.
" Simply put, 2023 was just a great
year for our company - strong performance
top to bottom. We did struggle
with some supply challenges throughout
some of the periods. I'm happy that's behind
us, but it was a headwind in many
periods in 2023.
Zimmer Biomet has doubled the size
of its product pipeline since 2018 and
says it has exciting new product launches
planned for 2024, particularly in the
hip area, with a goal of regaining market
momentum.
" We've got great new product launches
happening in early 2024. We've created a
stable supply environment. We are developing
flawless commercial execution as
evidenced by these growth rates. We have
seen and we continue to see a substantial
improvement in our end markets, " he
said. " This is not the same market growth
profile that we used to have. Patient demand
is strong. Volume is very strong given
a variety of reasons. As a market leader
in both knees and hips, being in better
markets is just very exciting as we enter
2024. "
He added, " We're not going back to
the 3 percent days when it comes to a
market growth rates. Both internal and
external dynamics give us confidence
that the best is truly ahead. When you
add to all of these variables the fact that
we have the strongest balance sheet in
the history of the company, there is no
doubt then that we can claim that our future
is nothing short of truly right. "
Long-Range Plans
Tornos emphasized that
this
turnaround
is " not a one-year wonder " but
rather a multiyear commitment, noting
that Zimmer Biomet has entered a
growth stage.
" We're no longer in turnaround
mode. We're ready to deliver by being laser
focused on the three strategic imperatives:
people and culture, operational
excellence, and innovation and diversification. "
People
and culture is about having
the right people in the right roles withMedical
Design Briefs, April 2024
Ivan Tornos, president and CEO.
in the right culture. " We must make sure
that we support team members to act as
owners and operators of the business, "
said Tornos. " This means decentralizing
decision making, driving agility, and empowering
team members at every level,
across every function around the world.
We must become leaner, and we've got
to be closer to the customer, " he said.
Equally important, he said,
Suketu Upadhyay, executive vice president of finance,
operations, and supply chain.
is that
Zimmer must truly live an environment
of pay for performance. " This is something
that has already kicked off in a
very meaningful way in the fiscal year in
this fiscal year 2024. An example of that
is the fact that we are incentivizing free
cash flow dollar generation or growth in
a much more disciplined way across the
enterprise, knowing that revenue is also
the most durable driver of free cash flow
performance. "
In operational excellence, Tornos
points to the restructuring of the company.
" Again this is about how we think
about growing the business top to bottom.
It is tough to restructure the company,
and it's certainly something that
we don't take lightly. We had to do it. It's
a tough choice once again, but we needed
to make operational changes to simplify
our restructure to deliver greater
efficiency and to ensure that we enhance
investments in the right areas of the business
- again closer to the customer. "
Beyond the restructuring, other initiatives
in the area of operational excellence
include drastically reducing inventory
levels at Zimmer Biomet. This will
drive substantial improvement in the
company's free cash flow while also reducing
days on hand by 50 days or more
www.medicaldesignbriefs.com
The ROSA® Knee System provides objective soft tissue
feedback and accurate bone resections, designed to restore
a patient's natural knee. (Credit: Zimmer Biomet)
and reducing excess and obsolescence
exposure. This, Tornos, said, is something
that Zimmer had not done that
well in previous years.
Zimmer also has a global initiative to
drive new product launch excellence
across the key new product introductions
that we have in the year 2024. In simple
terms, he said, for the seven or eight most
meaningful product launches, the company
will have a cadence of operating
mechanisms with proper governance to
ensure that it is maximizing these product
launches across each key geography.
The company is also focused on doing
better in the area of pricing dynamics.
In the third strategic imperative of
innovation and diversification, Zimmer
is going to continue to invest in innovative
R&D. " We're going to continue
to fuel our pipeline with meaningful
7
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Medical Design Briefs - April 2024
Table of Contents for the Digital Edition of Medical Design Briefs - April 2024
Medical Design Briefs - April 2024 - Intro
Medical Design Briefs - April 2024 - Sponsor
Medical Design Briefs - April 2024 - CVRFLAP1
Medical Design Briefs - April 2024 - CVRFLAP2
Medical Design Briefs - April 2024 - Cover1
Medical Design Briefs - April 2024 - Cover 2
Medical Design Briefs - April 2024 - 1
Medical Design Briefs - April 2024 - 2
Medical Design Briefs - April 2024 - 3
Medical Design Briefs - April 2024 - 4
Medical Design Briefs - April 2024 - 5
Medical Design Briefs - April 2024 - 6
Medical Design Briefs - April 2024 - 7
Medical Design Briefs - April 2024 - 8
Medical Design Briefs - April 2024 - 9
Medical Design Briefs - April 2024 - 10
Medical Design Briefs - April 2024 - 11
Medical Design Briefs - April 2024 - 12
Medical Design Briefs - April 2024 - 13
Medical Design Briefs - April 2024 - 14
Medical Design Briefs - April 2024 - 15
Medical Design Briefs - April 2024 - 16
Medical Design Briefs - April 2024 - 17
Medical Design Briefs - April 2024 - 18
Medical Design Briefs - April 2024 - 19
Medical Design Briefs - April 2024 - 20
Medical Design Briefs - April 2024 - 21
Medical Design Briefs - April 2024 - 22
Medical Design Briefs - April 2024 - 23
Medical Design Briefs - April 2024 - 24
Medical Design Briefs - April 2024 - 25
Medical Design Briefs - April 2024 - 26
Medical Design Briefs - April 2024 - 27
Medical Design Briefs - April 2024 - 28
Medical Design Briefs - April 2024 - 29
Medical Design Briefs - April 2024 - 30
Medical Design Briefs - April 2024 - 31
Medical Design Briefs - April 2024 - 32
Medical Design Briefs - April 2024 - 33
Medical Design Briefs - April 2024 - 34
Medical Design Briefs - April 2024 - Cover3
Medical Design Briefs - April 2024 - Cover4
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