Fred Hite: Yes. I would say it was typical levels. It was there, right. So, it wasn’t non-existent like it was in the summertime. But I wouldn’t say that it had a major impact negatively on the business in the third quarter.
Samuel Brodovsky: And shifting to MDO, listed them all out really nice new product cadence here. Is that – I mean I would assume we are probably going to take a step back from that going forward. But how should we think about the new product cadence there and what’s required to drive that towards the $100 million business into the future?
David Bailey: Yes. Good question. So, like I have said, we are really excited. When we acquired MD Orthopedics, part of the reason we did that was to essentially set a platform for what is now the OP SB business or the pediatric specialty bracing business. And in addition to the team at MDO really driving top line and profitability out of our business in Iowa, it has spawned just a number of inventors, surgeons, small companies that have come to us with ideas. And so we have a very robust pipeline of products that we expect to launch over the course of the next several years. We also have a really robust pipeline of potential partnerships and even some small companies that we could acquire over the course of the next few years.
So, it is very reminiscent, Sam, of what we all saw when we were here 17 years ago starting this business, the surgical side, where huge unmet need, a customer base that is really looking for a partner in the space, very limited competition in the space. And a number of niche products, right. A lot of these products are $100 million standalone products. But that’s why I think there is fairly limited competition. And it’s an opportunity for us to connect our brand from the majority of what our customer does and trying to avoid taking a kid to the operating room all the way through the operating room. And it helps us execute this strategy of surrounding the pediatric orthopedic surgeon with all the products they need to help kids. And so, so far, we are very pleased with what we see.
Obviously, it’s growing very rapidly. And there is just no shortage of opportunities there for us in the future. R&D cycle is slower or is faster. The costs associated with those R&D – that R&D cycle is less, profitability is really strong, and we like the capital usage, right. It doesn’t take a lot of capital to deploy these things. We are not deploying consigned sets in the field. So, there is just a lot to be excited about. And I think we stand behind this that if we can execute and build aggressively strategy here over the course of the next few years, that this will be a really large lever for growth and profitability and ultimately, cash generation.
Operator: Samuel, does that answer your question?
Samuel Brodovsky: Yes. Thank you for taking the questions.
Operator: Alright. One moment for our next question, please. Alright. And it comes from the line of Mike Matson with Needham & Company. Please proceed.
Unidentified Analyst: Hey guys. This is Joseph on for Mike. I guess the first one, I may have missed it on the call, but did you guys mention any plans, I guess in 2024 for converting international stocking distributors to agents?
David Bailey: No, we did not talk about that for ‘23 or ‘24 to be honest with you. So, the last time we have converted one of those is a couple of years ago was Germany. But there are no plans for any major conversions on the international side. It’s just continuing to grow the ones that we have right now.
Unidentified Analyst: Yes. Okay. Perfect. And then maybe could we get just an update on 7D, maybe how big is the installed base now?
David Bailey: Yes. So, a couple more units, I believe a couple of more units were placed in the quarter installed base. Fred, can you help me here, installed base, we have about 15 units or so. Is that right?
Fred Hite: Yes, probably a little less than that right now. Between sold and placed, it’s probably in that range, but consigned, it’s probably 10-ish, 8 units to 10 units.
David Bailey: Yes. And I think at this stage, what units aren’t officially placed or consigned are currently in some form of evaluation. So, we continue to see new users in the process of evaluating 7D and feel really good. We have a deep pipeline right now of locations where we expect 7D to be placed. It’s just as we have said in the past, these things, even the consignment of these things take some time, but really pleased with what we are seeing. And the technology is fantastic. It’s ideal for pediatric scoliosis. And it’s certainly something that we think is going to impact us positively in 2024, especially as you think about the units that were placed in 2023 on earn outs.
Unidentified Analyst: Okay. Great. Thanks very much. Yes. I will just do those two questions. I appreciate your guys’ comments on the quarter.
David Bailey: You bet. Thank you.
Operator: Thank you. And with that, we think you all who have participated in the Q&A. I will turn it back to David Bailey for final remarks.
David Bailey: Thank you. Well, once again, thank you everybody for joining us on the call. Fred and I are always available. And so we look forward to seeing you at some upcoming conferences or on the conference calls. Thank you.
Operator: Thank you all for joining. You may now disconnect.
