Paragon 28, Inc. (NYSE:FNA) Q3 2022 Earnings Call Transcript

Albert DaCosta: The reality is that, that’s the beauty of foot and ankle, right? There’s — I think the exact number is about 132 or 134 indications that we need to address. We weren’t really participating in those 2 segments, the external fixation and soft tissue meaningfully. But with the product launches we’ve launched, I still don’t want to give the impression that we’re done there. There’s still a lot of indications for us to look at and continue to expand, both the Ex Fix and soft tissue. And I think that’s true. We still have — I believe, the exact numbers around 30 projects under active development today and we’ve got a long pipeline of areas we need to address behind that. So the good news is we continue to add complementary products and new indications.

The other side of that is we just — we haven’t had time to really consider gen 2 on some of our core technology, and we will do that as we can. We did launch TenoTac 2.0 and we launched a version — a 2.0 version of our Phantom Hindfoot TTC Nail. So we do hit some of those, but we still have a lot of opportunity for areas, new areas for us to be participating in.

Mike Matson: And I was wondering if you could give us an update on Disior. I apologize if I missed this in the prepared remarks, but is it — can you just remind us of when there’s planning to commercialize that and where it will kind of be applied first?

Albert DaCosta: Absolutely. I will tell you that today, we’re actively using Disior meaningfully in our development process and integrating it into even some of the new products we have under active development today. We’re also integrating it with the additive orthopedics line. So a lot of internal work being done there. And one of the comments I made in the prepared remarks is that we’re just — we’re overwhelmed with how quickly we could answer questions given the 3-dimensional visibility that Disior or software platform like that gives us to — deformities and planning. I would expect to see something later in the year ’23 on the commercial side. And there’s a really nice pipeline of opportunities for us to start integrating Disior into some of the products we’ve got today on the market, including some of the new products that are being developed today.

Operator: The next question today comes from the line of Craig Bijou from Bank of America.

Craig Bijou: I wanted to start with — Albert, I want to start with your comment on the sales force headcount. And I believe you said it was 15% year-over-year. So I wondered if you could just provide a little bit of color of where the sales force hires that you’re making, where they’re coming from, are they experiencing foot and ankle reps? And then maybe just provide a little bit of color on kind of where they are in their productivity ramp? Obviously, overall, you guys are ramping productivity pretty nicely. But I guess just trying to get a sense of kind of new reps that have come on and how we should think about them being productive through the back of — or the rest of ’22 then even into ’23?

Albert DaCosta: Yes. Maybe I’ll take a stab at this one, and then Steve, if you have any color to put on here. But we mentioned our producing rep count is around 200. But our overall sales force headcount, we anticipate increase around 15%. We don’t typically report the overall sales count just because we do have people, like you mentioned, in different stages of their ramp up and integration with the company. So you’ve got some reps that are just getting their understanding of our products or getting their relationships established with their hospitals or their surgeons. And so you have a wide variety of people in those early stages. And we tend to focus a lot of our information on the earnings call, at least on our producing rep count.