Conformis could be an attractive acquisition for a large orthopedic device company such as Stryker, according to an orthopedic surgeon who penned an article on SeekingAlpha.
Under the contributor name Carolina Doc, the surgeon noted that ASCs aren't likely to invest in Stryker's Mako robotic system for hip and knee replacements, which costs an estimated $1 million.
"There is simply not enough volume of joint replacements to justify the cost," said the surgeon, whose center completes three to four joint replacements a month.
The author, who owns stock in Conformis, compared the orthopedic devicemaker's newly launched total hip system to Mako.
The Conformis total hip system comes in one presterilized box, cutting down the number of trays that must be brought into a surgery center and resterilized for a high price tag, he said. The computer-planned system has also helped some surgeons shorten operative times.
However, the company's stock lost almost a third of its market capitalization over the past month, he said. That could be because some patients aren't willing to wait eight weeks for Conformis to manufacture custom implants.
"Conformis is therefore losing all those sales completely to another company," the Seeking Alpha contributor wrote. "For that group of patients who are not willing to wait, a larger company could use the Conformis technology … and return with a closest match 'off the shelf' component and the same iView preoperative plan."
Conformis already has a contract to develop patient-specific instruments for the Stryker Triathlon Total Knee System, so the author sees Stryker as the company's most likely buyer.
"Stryker could market both pre-navigated (Conformis) hips for surgery centers and hospitals and Mako hips for those facilities that have a machine," he wrote.
However, he said he wouldn't rule out the possibility of another large orthopedic company pursuing Conformis' total hip system only.