Corin Share Discussion Threads

[wan] 26/9/2012 07:17

Note that revisions are aslo already a big feature -

Bloomberg News

Knee Replacements Double as Aging Patients Stay Active


By Nicole Ostrow on September 26, 2012

Knee replacement surgeries have more than doubled over the past two decades in the U.S. as older Americans strive to stay active later in life, a study found.

Total knee replacement procedures rose 162 percent from 1991 to 2010 while the number of procedures to repair a previously implanted artificial knee joint, called revision, jumped 106 percent, according to research released in the Journal of the American Medical Association.

By 2030, the demand for knee replacements may be as high as 3.48 million a year in the U.S., said Joseph Zuckerman, chairman of the Department of Orthopaedic Surgery at New York University Langone Medical Center, in an editorial accompanying today's study.

Full story -

[wan] 21/9/2012 07:43

Last week the 2012 British Orthopaedic Association (BOA) Congress took place in Manchester. The following provides a very interesting and upbeat update and should be read by Corin investors (current and prospective) –

British Orthopaedic Association Congress, Manchester
20 September 2012

This product continues to grow exponentially around the world and is fast becoming an implant of choice in many geographic segments.
Full story -

[wan] 19/9/2012 07:35

In response to certain commentary in the FT, which I titled "wobbly analysis", I commented recently that

"Suggesting the shares will be "dead money" in the months ahead highlights the difference between David's style and mine i.e. short term and long term. Put another way; holding shares ahead of 2013, when Corin expect product launches to have "a significant financial impact", might not exactly come under the category of dead money. There are a number of new products and product enhancements coming through (some in the second half of 2012), but Corin's new Unity knee-products are expected to have a significant financial impact, because they will address 60 per cent of the global knee market rather than the 10-15 per cent addressed by existing products."

The following then is an example of how advanced the development is for Corin's new knee products, but importantly it highlights how advanced the planning is for a roll out to the single largest knee market in the world!

FDA clearance –

10th September 2012
510(K) Number K113060
Device Name UNITY TOATAL KNEE SYSTEM





Followed by another recent FDA clearance for the Metafix Hip System -

14th September 2012
510(K) Number K121439
Device Name CORIN METAFIX HIP STEM



MetaFix
Cementless Total Hip Replacement


Those who took advantage of the FT article induced dip (I did), have already seen a nice return on their foresight, but I will say it again, I believe the best is still yet to come for the longer term investor.

[wan] 12/9/2012 07:58

A question given the recognised suitability of MoM to certain applications; could Corin be the only company capable of manufacturing and selling MoM implants? It would appear from the news flow elsewhere (product recalls etc) that their larger competitors are simply not up to the task!

The following demonstrates the innovation taking place within Corin –

Coatings extend hip implant life
11 Sep 2012

New wear resistant coatings developed by Tecvac and hip prosthesis manufacturer Corin could increase implant longevity in Metal-on-Metal (MoM) hip joints.

The SMART-HIP project also identified future potential applications on trunnions and tapers to prevent fretting and corrosion.

New PVD silver bearing coatings may protect against post-operative infection, and also provide a barrier to minimise metal ion release.

Full story -


Also worth reading through –

[wan] 10/9/2012 07:48

Recent news from Corin's website -

MiniHip™ cadaveric lab in Germany
4 September August 2012



Health Matters: Big boom of knee replacements
Sep 06, 2012

A few years ago, about 300,000 knee replacements were performed a year. The number is now a half-million and rising. What's fueling the big boom? A common condition with baby boomers.

In 10 years, there could be as many as 3.2 million annual knee replacement surgeries.

[cockneytrader] 05/9/2012 17:56

DS from the FT has got this company all wrong!

[wan] 05/9/2012 08:06

Corin set for US sales drive

Tuesday, September 04, 2012

THE chief executive of Corin, the manufacturer of orthopaedic devices, believes the group's potential in the United States is huge.

[wan] 03/9/2012 07:42

Corin's Product strategy update May 2012 is worth revisiting. Apart from giving an excellent overview of the product development pipeline, it also confirms that the commentary in the recent Interims on the new Unity Knee is aligned with the schedule from the strategy update.

Page 20 is worth highlighting, as this shows the potential impact of Corin's strategy to broaden their portfolio and address a much larger market than they do today.



You will also note that the US represents the largest market, which is also forecast for explosive growth –

America's Aging Population Can Save Medicare
Posted: 09/01/2012

So it's no wonder that this new kind of aging -- and its impact on Medicare -- has become a watershed issue of the 2012 Presidential campaign. But for all the speeches delivered by the politicians and all the ink spilled by the cognoscenti, everyone is missing the point. It's not that the 77 million Baby Boomers in the U.S. are going to bankrupt Medicare. The point is just the opposite. However ironic it may seem, this new, gigantic aging cohort is going to save the social insurance program.

How, indeed, can the explosive demand brought by the unprecedented aging of the American population save a program that pays out to the aging?

Fully embraced, an active, productive aging is creating and will continue to create a culture shift in which "seniors" break out of traditional roles of "need" and "dependency" and become vibrant producers in our society. No longer the automatic recipients of government welfare -- and popular pity and condescension -- healthy, vital seniors will remain at the heart of social and economic life and spare the precious federal insurance dollars for those really in need. This is not FDR's or LBJ's aging population, and we shouldn't treat it as such.

But this transformation of aging isn't just culturally liberating. It's also economically essential. In the United States, there will soon be more people over 65 than under 15. So we're not just witnessing a new kind of aging; we're seeing the emergence of a new kind of society, one where older adults outnumber children. From both a social and a financial point of view, how can we look these demographic realities in the eye and not re-think how we provide healthcare and other essential services to the aging?

Full story -

[wan] 02/9/2012 07:36

David Schwartz, who I have met, has a different investing style to me. He has written a not exactly flattering article on Corin. Whilst I concur with his thoughts on ISA/AIM, I cannot say the same about his commentary on Corin –

Contradictory Aims and wobbly knees
By David Schwartz



Wobbly Analysis

Dealing with each point in turn;

DS "Corin just eliminated its interim dividend."
No, not just, because this was announced in the 2011 FY Results on 8th March 2012. Importantly this was for reasons other than DS is implying. From the 2011 FY Results –

"The Board, having considered the cash requirements of the business needed to support growth, the level of borrowings and the cost of continuing to pay dividends has decided that it is in the Group's best interests not to recommend the payment of a final dividend. The Board will continue to monitor closely its policy in relation to dividends with a view to potentially resuming dividends when the current investment phase is complete."

DS "It also warned investors that first-half revenues were boosted by big orders from a major US customer which will not be repeated in the second half of the year."

This is an incorrect statement! From the First Half Results –

Current trading and outlook
"The sales trends across the Group from the first half are broadly continuing in the second half to date. However, following the high level of stocking orders to MAKO in the second half of 2011 and with no significant orders from MAKO expected in the second half of this year, overall the second half of 2012 will see a lower level of sales reported than in the previous year."


So, anyone paying attention would have realised that the stocking orders to Mako would not be repeated. From the 2011 FY Results –

"Stocking orders from MAKO during the second half contributed strongly to the growth in hip revenues. The initial stocking orders, which included a significant proportion of instruments in addition to implant stocks, were largely completed in 2011 as MAKO upgraded many of its existing robotic installations to include its hip application."

Hence there is very good reason for Corin to quote the 'underlying' growth of the hip portfolio 'excluding' Mako and MoM. In 2011 growth in hips excluding Mako and MoM was 29% and Corin reported that this very strong trend continued in the first half of 2012 with growth of 35% and that the sales trends are broadly continuing in the second half.

I suppose it is also what you describe as a big order then. A bit of arithmetic indicates that the stocking order to Mako in the second half was not exactly huge, with the clue being contained in the different growth rates including and excluding Mako and MoM. From the 2011 Results –

"Stocking orders of hip implants and instruments to Mako Surgical Corp. ("MAKO") contributed substantially to this jump in growth. Underlying constant currency sales growth in hips was a very encouraging 29%, excluding sales to MAKO and sales of MoM hips. MoM sales are now only 5% of Group sales."

Further down, the Results reveal that Sales of the Group's hip products increased by 43% to GBP27.2m (2010: GBP19.0m), an increase of 41% on a constant currency basis. So, if the growth trend continues as indicated, sales in the second half of 2012 might well be lower than the second half of 2011, which was £25.8m, but not hugely lower (the figures indicate Mako sales at circa £1m?).



DS "I worry that City expectations are too optimistic given Corin's warning about second-half revenue slippage."
So, if my assumption and sums are anywhere near right, second half revenues will not be below expectations. Likewise I don't expect, with gross margins of 66%, that profits will miss expectations.



DS "A bigger fear for me is the litigation risk associated with "metal-on-metal" hip devices. These were hot items a few years ago for several major players in the orthopaedic industry. Unfortunately, the product did not work as well as expected. Some patients experienced pain and were forced to endure follow-up operations to replace faulty devices. Litigation risk is a growing threat to all orthopaedic producers."

Of course MoM litigation presents for some uncertainty, but the events driving this appear quite unique to Corins competitors, so I expect Corin to continue to successfully defend against such claims. Unlike DS though, I have looked closer at Corin's clinical data, and I have also been following MoM events, including the full two day FDA meeting in the US, during which Corin were present (see below). Corin have already successfully defended itself against one claim, using very strong clinical evidence and regulatory approvals -

Corin wins Cormet device lawsuit in New York
30 July 2012
The same ruling was given by the Supreme Court for the Riegel v. Medtronic case in 2008 that applied to similar medical devices.
Full story –


From a legal perspective, the above would appear to bode well.

FDA Panel: No Answers to MoM Hip Dilemma
By John Gever, Senior Editor, MedPage Today
Published: June 29, 2012

"Alarmist Press"
But the more urgent question is how to manage the many patients -- estimated at 500,000 to 750,000 in the U.S. -- who have already received such implants. Orthopedic surgeons on the panel said they had been hearing increasingly from worried patients who had read media reports of problems.
John Skinner, an official of the British Hip Society, said that "an alarmist press" in Great Britain had raised broad fears among patients in the country, with many demanding to have their implants removed even though they had no apparent problems.

Graham Mercer of the Australian Orthopedic Association said the situation was similar in his country. He blamed "misinformation out there in the media." Both men urged the committee and the FDA to do what they can to discourage unnecessary revision surgeries.




Full Coverage of the FDA Two Day Meeting (a very long read) –

LIVE BLOG: FDA panel discusses
metal-on-metal hip arthroplasty systems
• June 27, 2012



DS "The share price graph provides another warning signal. The recent rally ran out of steam precisely where prices topped out in the spring of 2011. It looks to me that this price level or "resistance" might be a difficult barrier to penetrate."

Do graphs predict the future? Most investors will look at graphs and everyone will have their own opinion on this, and of course by how much they rely on them as an indicator. The fact is, Corin's shares have responded to Corin's growth strategy, which as evidenced in the recent results is already delivering. However, the best is yet to come!

Finally, suggesting the shares will be "dead money" in the months ahead highlights the difference between David's style and mine i.e. short term and long term. Put another way; holding shares ahead of 2013, when Corin expect product launches to have "a significant financial impact", might not excatly come under the category of dead money. There are a number of new products and product enhancements coming through (some in the second half of 2012), but Corin's new Unity knee-products are expected to have a significant financial impact, because they will address 60 per cent of the global knee market rather than the 10-15 per cent addressed by existing products.

Two different styles and two different interpretations; short term or long term. Everyone to their own.

[wan] 31/8/2012 08:13

An improvement in the opinion in the IC, plus some recognition that the growth strategy could ultimately transform the group -

Corin gets hip

Efforts by replacement hip and knee maker Corin to boost sales through product revamps are producing encouraging results and, although higher marketing spend dampened the impact on the bottom line, underlying operating profits still more than doubled to £1m in the latest half year.
Full story -

[wan] 30/8/2012 07:51

Investoree...Corin was always a longer term investment strategy from my perspective, and accumulating a sizeable holding ahead of 2013 (and beyond), was always on my agenda too. Going forwards, a dividend reinstatement will provide for an interesting indicator too.

I note that the theme which has been occurring over the last few months reappeared, and later in the day yesterday the larger level 2 buyers reappeared (someone was bidding for 75,000 shares at 56p), so Corin's cautious, but should still do well tone, did not put those buyers off!

The underlying growth theme and the impact of new product introductions in 2013/14 is what has got most of my attention, and it would appear that this may have caught the attention of others too. Time will no doubt tell if any stake building is actually taking place, but a bid is not what I am ultimately looking for here!

Corin has published the Interim Results Presentation on their website –


On another note, I recently noticed that Corin have a dedicated LARS website –

[investoree] 29/8/2012 08:57

Wan like you I have also made another small top-up. Your excellent postings and my own belief in the company and its products lead me to conclude that long term we are backing a winner.

[wan] 29/8/2012 08:40

In my opinion today's price fall is a significant overreaction! So, I have taken advantage of what appears to a be an opportunity.

[chrisdgb] 29/8/2012 08:19

Sting in the tail in the outlook..

[wan] 29/8/2012 07:59

Yes, very good progress has been made, with a bit of a caution for the second half. But as I have previously stated, there will be a postive and signifcant impact in 2013 (on several fronts).

[nellie1973] 28/8/2012 14:45

Results tommorrow.The steady rise in price would suggest good progress!

[nellie1973] 15/8/2012 13:15

Nice article thanks Wan.

[wan] 15/8/2012 07:47

Despite the dates, the following was only published yesterday on Corin's website -

Delivering educational excellence worldwide
19 June 2012


The Great Debate
4 July 2012

Corin was delighted to support this independent meeting, which included a number of sponsored exhibition stands, providing an opportunity for the 300 or so delegates from across the UK to speak to a wide cross-section of industry about their emerging technologies. Key products from Corin's hip portfolio – MiniHip™,MetaFix™,TaperFit™,Trinity™ and ECiMa™ were on display on the company's booth, as were Unity Knee™ and Uniglide™ UKR and LARS™ soft tissue internal fixation, attracting interest from a high number of delegates.



For those up to speed the following will provide a market beyond that of just retailers and Life Assurers -

August 14, 2012 4:09 pm
Retailers target grey spending power
By Louise Lucas

Globally, those over 55 – dubbed the "silver segment" by Boston Consulting Group – will account for more than half the consumer spending growth in developed markets over the next two decades, according to the consultancy.

Japan and Germany, whose baby boomers are coming of age, lead the way in ageing. But thanks in part to healthy diets Japan's "grand generation" – nearly a quarter of the population is also over 65 – are also ideal customers.

"These are the wealthiest, most active, healthiest and longest-living retirement generation in the history of the world,"

Full story FT.com -

And in the UK the over 65s will grow from 16 per cent of the population a decade ago to 20 per cent in 2022, according to National Statistics and is described in the FT's Lex column as an unstoppable trend –

[cockneytrader] 13/8/2012 15:41

Wan I agree. But large health/pharma are awash with cash. And share buy backs don't do anything for future growth. I predict lots of M&A over the next year or so.

[wan] 13/8/2012 12:52

I am not discounting a bid, but a premium on today's price is not why I am invested here! I would much prefer to wait longer for what I believe will provide a multi-bagger.

[nellie1973] 13/8/2012 12:25

Reminds me of Nestor Health last year, steady quiet accumulation then the bid! Price action very similar.

[cockneytrader] 13/8/2012 09:12

a takeover target if ever I saw one. S&N could easily digest a company of this size.

[nellie1973] 10/8/2012 20:07

Excellent, finally a breakout on this week of chunky buying..!