Approaching Profitability

COVER STORY

NuVasive's guidance for full-year 2007 revenues is between $139 million and $143 million, which would represent growth of more than 40% over 2006 revenues. And, perhaps even more significantly, the company expects to tip over into profitability during the year.

NuVasive's guidance for full-year 2007 revenues is between $139 million and $143 million, which would represent growth of more than 40% over 2006 revenues. And, perhaps even more significantly, the company expects to tip over into profitability during the year.

In 2006, NuVasive experienced year-over-year revenue growth of 57%. For full-year 2006, the company reported a net loss of $47.9 million on revenues of $98.1 million. During the year, the company also completed its transition to an exclusive sales force, a move that has led to increased vertical integration of hospitals using NuVasive products.

"The strategy of bringing to market differentiated products to further our penetration of the minimally invasive spine surgery marketplace has, and will continue to be, a key initiative for NuVasive," said NuVasive chairman and CEO Alexis V. Lukianov. "Building on our nine product launches in 2006, we plan to execute a host of launches in 2007. These launches will, of course, focus on our maximum access surgery (MAS) technology platform, but will also significantly increase the breadth of our cervical and motion-preservation product offerings. Balancing our opportunities with the drive to increase our operating efficiencies is also a top priority."

For the first quarter of 2007, NuVasive reported a net loss of $4.4 million on revenues of $33.2 million, compared with a net loss of $8.1 million on revenues of $19.7 million in the year-ago period. The revenue increase represents 69% growth over first-quarter 2006 levels.

In January 2007, NuVasive announced that it had acquired technology and assets from Radius Medical LLC, including exclusive license and marketing rights to the Formagraft bone graft biologic product and the underlying collagen technology.

"Our robust first-quarter results were driven by the increased effectiveness of our exclusive sales force on MAS products and the early success of SpheRx II, XLP Lateral Plate, and Formagraft," Lukianov said. "These innovative products were released on a limited basis during the quarter and were particularly well received by spine surgeons. We remain excited about these products and the revenue they will bring starting in the third quarter, by which time inventory will be substantially increased."

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