There have been hundreds of articles written about ConforMIS, a disruptive orthopedic force that is now 15 years old. Let me share a different point of view.
TiVo changed the TV industry… forever.
Remember the first time you could “pause live TV” and “skip commercials”. It was magical. TiVo was a great disruptive company and even became a verb, “to TiVo”.
Fast forward to today and we find that the TiVo business model never worked. TiVo was “the first”, but they committed the deadly sin of not continuing to innovate. The TiVo product that exists today is essentially the product launched in 1999 with some new features for streaming.
Nimble technologies like Hulu and YouTube ultimately side stepped TiVo.
ConforMIS changed the way we all thought about custom joint replacements… forever.
They were “the first” custom implant company at scale.
They asked, “Why couldn’t primary total joint surgery be more customized?” What if the medial femoral condyle is a little wider? No problem. What if the tibial plateau has a strange shape? Done. What would an implant look like to correct varus or valgus? Done.
Today ConforMIS offers a range of custom knee and hip implants. The ConforMIS method starts with a CAT scan of the knee to create a virtual bone model, ligaments and tendons. For the femoral component, a mold is 3D-printed and filled with cobalt chrome to create a patient-specific implant. For the tibial component, the perfect shape is machined from titanium. Then ConforMIS prints perfect disposable plastic instruments for each surgery. This is all delivered in a user-friendly sterile package.
Business Snapshot
ConforMIS was founded in 2004 and went public in 2015. The company has around 300 employees and has raised an amazing $523M (so far).
Last year, in its 15th year of existence, the company lost $24M on $69M in sales. That means that they spent $93M in expenses to obtain $69M in sales (ref: Yahoo Finance).
What happened?
Adapt or Die
Someone has to be first. Someone has to break through the brick wall. ConforMIS was a game changer. ConforMIS was ahead of its time in 2004, probably just too early, maybe guilty of raising too much money and not focusing on scaling the business with leverage. They never figured out how to double the sales without doubling the expenses.
I believe that ConforMIS will go down in orthopedics history as “our TiVo”. A promising a disruptive first-mover that just did not learn to scale properly.
Future
I believe that new additive manufacturing startups will create custom implants at scale, better and faster and without the need for 300 employees and $500M in funding. They will exploit state-of-the-art additive manufacturing with more nimble business models and accomplish this with 50 employees and appropriate levels of funding.
In the next few years, 3D-Printed implants are coming to every orthopedic procedure.
Which companies with smart additive manufacturing will ultimately win in orthopedics?
Thoughts? email: tiger@tigerbuford.com