WARSAW, Ind. - Zimmer Biomet Holdings, Inc. (NYSE:ZBH), a global leader in medical technology, announced today the U.S. Food and Drug Administration (FDA) has granted Premarket Approval for its Oxford® Cementless Partial Knee system. This device, which is now the only FDA-approved cementless partial knee implant in the U.S., is designed to improve surgical outcomes for patients undergoing partial knee replacement.
The approval comes after an Investigational Device Exemption (IDE) study and non-clinical testing demonstrated the safety and effectiveness of the implant. According to Zimmer Biomet, the Oxford Cementless Partial Knee offers enhanced fixation, a better long-term implant survival rate, and increased efficiency in the operating room compared to its cemented counterpart.
The company's President of Knees, Joe Urban, emphasized the benefits of the cementless procedure, citing its less invasive nature and improved outcomes over total knee replacement. The design of the Oxford Cementless Partial Knee features a mobile bearing that moves with the femoral component, allowing for a natural knee movement and stable bone-to-implant fixation.
Clinical experience with the Oxford Cementless Partial Knee spans over 20 years and includes more than 300,000 procedures in over 50 countries. Data from the UK national joint registry indicate a 94.1% implant survival rate at 10 years, which is higher than the average for all other partial knees.
Dr. Adolph V. Lombardi Jr., President of JIS Orthopedics, highlighted the system's benefits for younger, more active patients, including natural knee flexion and stronger implant adhesion, which can lead to better long-term durability.
Zimmer Biomet plans a U.S. nationwide launch in the first quarter of 2025, including FDA-required training for surgeons on the cementless surgical technique and patient selection. The Oxford Partial Knee also comes with a lifetime limited warranty for U.S. patients, covering the cost of replacement implants under certain terms and conditions.
The Cementless Oxford Partial Knee System is indicated for use in patients with osteoarthritis or avascular necrosis limited to the medial compartment of the knee and is intended to be implanted without cement. Potential risks, as with any surgical procedure, may include loosening, dislocation, fracture, wear, and infection.
This news is based on a press release statement from Zimmer Biomet Holdings, Inc.
In other recent news, Zimmer Biomet, a medical device company, reported a 4% increase in net sales for the third quarter, reaching $1.824 billion, surpassing analysts' expectations. The company's earnings per share (EPS) for the quarter also exceeded projections, reaching $1.74. However, challenges with the implementation of an Enterprise Resource Planning (ERP) system persist, leading Truist Securities to maintain a Hold rating on the stock, while Oppenheimer retained its Outperform rating.
Truist Securities increased its price target for Zimmer Biomet from $112.00 to $117.00, based on a revised 2025 EPS forecast of $8.66. The company's management has revised its constant currency revenue and EPS guidance downwards, but anticipates a return to normal shipping levels by the end of 2024.
Zimmer Biomet repurchased approximately $600 million in shares during Q3 2024 and adjusted its full-year revenue growth projection to 4.25%-4.75% in constant currency. The company's free cash flow is expected to reach around $1 billion, with adjusted EPS anticipated to be between $7.95 and $8.05.
Upcoming product launches, including the Z1 hip system and Persona IQ knee technology, are expected to drive growth. These are recent developments in the company's performance and strategy.
InvestingPro Insights
The FDA approval of Zimmer Biomet's Oxford® Cementless Partial Knee system aligns with the company's strong financial position and market performance. According to InvestingPro data, Zimmer Biomet boasts a market capitalization of $22.13 billion, reflecting its significant presence in the medical technology sector.
The company's revenue growth of 4.35% over the last twelve months, coupled with a robust gross profit margin of 71.9%, indicates a healthy financial foundation to support the launch of this innovative product. This growth is particularly noteworthy given the competitive nature of the medical device industry.
InvestingPro Tips reveal that management has been aggressively buying back shares, which could signal confidence in the company's future prospects, including the potential success of the Oxford Cementless Partial Knee system. Additionally, 16 analysts have revised their earnings upwards for the upcoming period, suggesting positive expectations for Zimmer Biomet's financial performance.
The company's P/E ratio of 21.1, which is relatively low compared to its near-term earnings growth, suggests that the stock may be undervalued considering its growth potential. This could be particularly relevant as Zimmer Biomet prepares for the nationwide launch of its new knee system in Q1 2025.
Zimmer Biomet's track record of maintaining dividend payments for 13 consecutive years, as highlighted by another InvestingPro Tip, demonstrates financial stability and a commitment to shareholder returns. This could be attractive to investors looking for both growth potential and income.
For readers interested in a deeper analysis, InvestingPro offers 7 additional tips that could provide further insights into Zimmer Biomet's investment potential.
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