Sanara MedTech discontinues Tissue Health Plus segment

FORT WORTH - Sanara MedTech Inc. (NASDAQ:SMTI) announced Tuesday it has completed its evaluation of strategic alternatives for its Tissue Health Plus (THP) segment and decided to discontinue the operations. The medical technology company, with a market capitalization of $250.33 million, appears slightly overvalued according to InvestingPro Fair Value estimates.

The medical technology company, which focuses on surgical products, will classify THP as discontinued operations in its financial statements going forward, according to a press release statement.

The company initiated the wind-down process in late September and expects it to continue through the end of 2025. Sanara anticipates the total cash investment in THP will range from $5.5 million to $6.5 million in the second half of 2025, with no material cash expenses related to THP expected after year-end. Despite not being profitable over the last twelve months with EPS at -$1.16, InvestingPro data shows the company maintains a healthy current ratio of 2.26, indicating its liquid assets exceed short-term obligations.

"After reviewing strategic alternatives for THP, Sanara’s management and Board of Directors decided to cease development efforts on the THP platform and discontinue THP’s operations to allocate resources to Sanara’s surgical business, which we believe has the greatest potential to deliver sustainable, long-term growth," said Seth Yon, Sanara’s President and Chief Executive Officer.

The company’s core surgical business markets and distributes products including CellerateRX Surgical Activated Collagen Powder, BIASURGE Advanced Surgical Solution, and several tissue repair products primarily in North American markets. This surgical segment has helped drive impressive revenue growth of 34.29% over the last twelve months, with total revenue reaching $97.24 million. The company also boasts an exceptional gross profit margin of 91.76%, according to InvestingPro data.

Sanara plans to discuss the strategic realignment further during its third quarter earnings call on Wednesday.

The decision aims to improve operating efficiency and redirect resources toward the company’s surgical product line, which management indicates has shown consistent revenue growth over recent years. With the earnings report just one day away, investors seeking deeper insights can access comprehensive analysis through InvestingPro’s Research Report, part of its coverage of over 1,400 US equities that transforms complex Wall Street data into clear, actionable intelligence.

In other recent news, Sanara MedTech Inc. announced its financial results for the second quarter of 2025, reporting a net revenue of $25.8 million. This marks a 28% increase compared to the previous year and surpassed the revenue projection of $25.4 million made by H.C. Wainwright. Despite a net loss of $2.0 million, the company performed better than expected, as the estimated loss was $2.9 million. Additionally, H.C. Wainwright raised its price target for Sanara MedTech to $54.00 from $53.00 while maintaining a Buy rating.

In corporate leadership news, Sanara MedTech revealed a planned CEO transition. Seth Yon, currently serving as President and Chief Commercial Officer, will assume the role of President and Chief Executive Officer effective September 15, 2025. Yon will also join the company’s Board of Directors, succeeding Ron Nixon, who will continue as Executive Chairman. These developments indicate strategic leadership changes and robust financial performance for the company.

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