Smith & Nephew plc (NYSE:SNN) Q4 2022 Earnings Call Transcript

You asked for how you — how that breaks up by year and by segment. I would refer you to Capital Markets Day that’s coming later in the year, where we’ll detail out what that looks like. If you go to AAOS, you’ll get a pretty good sense as to at least what the orthopaedics part of that pipeline looks over the near future because of the booth kind of setting your knee able to talk about in near-term pipeline. So as a newcomer coming into the space, as I took — take a look at where we’ve been and really the sheer number of new factors coming in, I get excited as a new person coming in because we’ve never before as a company, had that portfolio, particularly in ortho. And of course, we’ve been well positioned in the other segments. So hopefully, that addresses your questions.

Anne-Francoise Nesmes: And if I may just add in terms of the R&D as well allocation, all franchises have the pipeline coming through. So there’s no disproportionate element of investment behind one of the other. There’s a program behind all franchisees to drive the price.

Kyle Rose: Great. Good morning. Kyle Rose from Canaccord. I wanted to build on Hassan’s question about the medium-term confidence within orthopaedics. If I look historically, you have had product gaps, particularly when we think about some areas of robotics and then on the cementless knee. When you think about the sustainability of the turnaround and growth of the orthopaedics, how much of that is just a pricing component in getting a better pricing aspect versus taking true mix from a market share perspective? And then secondarily, in the Advanced Wound Devices side of the business, for several years now, you’ve called out robust growth within PICO. It would be helpful to frame out the size of that business relative to RENASYS.

Then also, I think it was maybe back in 2019, there was some bullishness just around contract wins in the United States with respect to RENASYS. You’re obviously continue to see positivity there, at least in the commentary you’re talking about today. So how should we think about the U.S. negative pressure wound business moving forward?

Deepak Nath: Thanks for the question, Kyle. So I’ll take those or at least start with those. The first one around Orthopaedics. There’s a role for price, right? Pricing is one of the elements of the 12.5%, particularly strategic pricing, where we haven’t been as disciplined around price as a company strategic pricing as we could have been. So there is an aspect to that, that we’re working on. But that alone isn’t going to reset our fortunes in orthopaedics. A very important component of that is mix that’s going to drive share recapture or share growth in orthopaedics. So it’s an important aspect of how we get back to growth. As you noted, historically, we’ve had gaps in our portfolio. We didn’t have a robotic system. We didn’t have a cementless offering, and the list can go on and on.

And while no company has got it all and we don’t have a perfect lineup. We have more in our bag than we’ve ever had before. We have more in our hands to drive growth than we ever had before. And that’s a change in terms of our position today relative to the recent past in Orthopaedics. But we have to fix our execution, which really has held us back, which is why the first bucket under the 12-point plan is Fix Orthopaedics, and that’s a deliberate choice for us, right? Five of the initiatives under the 12-point plan are geared towards in one way or another fixing orthopaedics. And there’s multiple components to that. There’s a logistics component where we’ve gotten out of step that has impacted our ability to supply the market to have product available to customers when they need that.