We don't yet know the name of the new company that will be comprised of Zimmer Biomet's current spine and dental businesses, but we now know who will lead it. The publicly traded company will be created by the recently announced spin-off, which is expected to close in mid-2022.
Warsaw, IN-based Zimmer Biomet has appointed Vafa Jamali to serve as CEO of the new company, which for now is being referred to simply as "NewCo." Jamali most recently served as the chief commercial officer of Rockley Photonics, where he led commercial strategic planning for the early-stage integrated optics solutions provider. Prior to that, he led the respiratory, gastrointestinal, and informatics division at Medtronic, a $3 billion in annual revenue business that included 10,000 team members across four businesses and 14 manufacturing sites.
"Vafa's extensive knowledge and experience in building teams, developing long-term growth strategies, prioritizing resources, driving execution, and delivering growth across the medical device industry make him the ideal leader to shape the direction of NewCo and move the business forward," said Bryan Hanson, president and CEO of Zimmer Biomet. "I look forward to partnering with Vafa – and the leadership team that he builds – through this important transition so we can position NewCo for maximum success."
Jamali said he will work closely with the new team to develop and drive investment strategies and a plan for long-term growth in the spine and dental markets, while keeping a focus on delivering for patients, customers, team members, and future shareholders. In addition to Rockley Photonics and Medtronic, Jamali has held leadership roles at Covidien (acquired by Medtronic via a merger completed in January 2015), Cardinal Health, and Baxter.
One thing missing from Jamali's resume, according to one medtech analyst, is sector-specific experience in spine or dental.
"At first glance, we're encouraged that [Zimmer Biomet] moved so quickly to put new senior leaders in place," Kyle Rose, a medtech analyst at Canaccord Genuity, wrote in a report published Tuesday. "However, we're somewhat underwhelmed by the hire."
Rose acknowledges in his report that he has no experience with Jamali so his opinion is less a comment on the new CEO's leadership potential and more a reflection of the fact that he would have preferred to see someone with deeper experience in either the spine or dental markets.
"The bottom line is that when we step back and look at the companies that have successfully taken share in spine over the last 24 months, it is clear that deep sector experience is an asset given the importance of building/managing the distribution channel and product pipeline," Rose said. "Where we've seen some new CEOs stumble out of the gate is bringing broad top-down managerial strategies to an industry that still rewards high-touch commercial models and nimble product development. That said, NewCo's business units have vastly different commercial/strategic focuses and Mr. Jamali's experience managing broader portfolios across multiple markets will certainly be an asset."
The analyst also noted that Jamali's experience at Covidien and Medtronic, and now his experience working with Zimmer Biomet's Hanson, is a plus, and the analyst expects to see a similar cultural turnaround at NewCo that we've seen at Zimmer Biomet under Hanson's leadership.
"Regardless, our attention now turns to who the new CEO will tap for his broader executive team, including leaders for the respective business units, which we believe can effectively offset the lack of direct spine/dental experience," Rose said. "In our opinion, the potential for disruption in the underlying businesses over the next 18 months pre-spin represents one of the biggest risks at present. We look for incremental strategic plans as well as the hiring of the broader NewCo management over the coming months to allay investor concerns."