DUBLIN and DALLAS – Nov. 10, 2016 – Medtronic plc (NYSE: MDT) today announced the launch of Medtronic Orthopedic Solutions, a comprehensive offering for total joint replacement episodes of care designed to drive clinical and economic outcomes. This offering is in response to the high costs associated with hip and knee replacements, along with the growing emphasis on improving patient outcomes, and specifically addresses the Centers for Medicare & Medicaid Services (CMS) recently implemented Comprehensive Care for Joint Replacement (CJR) model – a bundled payment initiative that holds approximately 800 hospitals accountable for the quality of care they deliver for hip and knee replacements. Medtronic Orthopedic Solutions offers a consultative program designed to help providers meet CJR requirements by reducing system costs while addressing patient satisfaction and outcomes; it will support providers from pre-surgical planning through the 90th day post discharge. In addition, Medtronic is launching a value-based total knee arthroplasty system at the American Association of Knee and Hip Surgeons Annual Meeting (AAKHS), which is currently taking place in Dallas. The Total Knee Arthroplasty System will be widely available in the first half of 2017.

“Medtronic is here to help speed the adoption of value-based healthcare in orthopedics by helping hospitals drive down costs while keeping outcomes top of mind,” said Geoff Martha, EVP and president of Medtronic Restorative Therapies Group. “Our technological and operational efficiency know-how – along with our insight into the various points along the care continuum – helps us develop effective solutions, tailored to client needs. And we back this up by sharing potential savings with our customer, which means we get paid if our program is successful in reducing episode costs for customers. This is about more than just offering implants or individual technologies and services; it’s about partnering with all stakeholders throughout the entire episode of care to enable patient-centered care at the best value.”

CMS targeted hip and knee replacements because they are the most commonly performed inpatient procedures for Medicare patients and often entail lengthy recoveries.¹ More than 400,000 procedures took place in 2014, with hospital costs of $7 billion.¹ There is significant variance in complication rates and overall costs across hospitals and geographies. CJR aims to improve patient care by encouraging hospitals, physicians, and post-acute care providers to work together to improve the quality and coordination of care from the initial hospitalization through recovery, and financially rewarding hospitals for providing cost effective and high quality care, while levying penalties for poor outcomes.

“CJR represents a completely new approach to healthcare with bundled payments rewarding the best outcomes, which will ultimately improve patient care,” said Joseph A. Bosco, M.D., an orthopedic surgeon in New York, NY. “But to succeed, hospitals need new solutions to streamline the delivery of care and evaluate outcomes. The way CJR works, target episode prices will be set in comparison to large regions, so there will be a premium to figuring things out very quickly.”

Medtronic Orthopedic Solutions was developed in partnership with leading physicians who have successfully implemented bundled payment programs. It is designed to create tailored solutions that improve quality and patient experience, while lowering costs across the care continuum. These solutions include:

• Care Pathways – A comprehensive, patient-focused program designed to uncover opportunities to reduce costs and improve efficiencies, patient satisfaction, and outcomes at every point of care. It also provides technology to monitor success and course-correct as needed. This service will be offered as a performance-based partnership; Medtronic is compensated when the company achieves successful outcomes and cost savings for customers.
• Patient Monitoring with Medtronic Care Management Services (MCMS) – Our remote patient monitoring and engagement solutions are designed to help patients recover at home, deliver actionable information to providers to help enable timely and effective clinical interventions, and provide patient context and education important for self-care. With a remote patient monitoring program designed specifically for patients recovering from total hip and total knee arthroscopy, MCMS may help clinicians manage readmission risk and improve patient satisfaction – important factors in CJR evaluations.
• Total Knee Arthroplasty System – Medtronic’s FDA-cleared knee implant was designed to facilitate cost savings by leading orthopedic surgeons who have significant clinical and design experience. The implants are made in the United States using well-studied materials and supported intraoperatively by trained clinical specialists.
• Bleeding Control with the Aquamantys(TM) System – This well-established Medtronic technology combines radiofrequency energy and saline to provide hemostatic sealing of soft tissue and bone. Aquamantys use has been shown to decrease length of stay and hematoma rate, and increase the number of patients discharged to home self-care following primary total hip arthroplasty.² In total knee arthroplasty, Aquamantys use has been shown to reduce blood loss, transfusion rates, and drain output, and to maintain hematocrit levels.³  

“Quality, lower-cost implants are a very attractive option as we seek to improve patient’s lives while also providing value-driven healthcare,” said Richard Scott, M.D., professor of Orthopedic Surgery, Emeritus, at Harvard Medical School and formerly chief of Joint Arthroplasty at The New England Baptist Hospital and co-designer of Medtronic’s total knee arthroplasty system. “We designed Medtronic’s total knee arthroplasty system to be simple, versatile and intuitive without unnecessary complexity and inventory. The goal is to benefit everyone – first and foremost the patients, but also the surgeons, hospitals and payers who are providing their care.”

Medtronic intends to report results from the Medtronic Orthopedic Solutions business as part of its Spine division within the Restorative Therapies Group. For more information about Medtronic Orthopedic Solutions, please visit
http://www.medtronic.com/us-en/healthcare-professionals/services/orthopedic-solutions.html.
Medtronic’s Total Knee Arthroplasty System
Medtronic Launches Orthopedic Solutions Business and Total Knee Arthroplasty System
Click the thumbnails above for a larger image.

About Medtronic
Medtronic plc (www.medtronic.com), headquartered in Dublin, Ireland, is among the world’s largest medical technology, services and solutions companies – alleviating pain, restoring health, and extending life for millions of people around the world. Medtronic employs more than 88,000 people worldwide, serving physicians, hospitals and patients in approximately 160 countries. The company is focused on collaborating with stakeholders around the world to take healthcare Further, Together.

Any forward-looking statements are subject to risks and uncertainties such as those described in Medtronic’s periodic reports on file with the Securities and Exchange Commission. Actual results may differ materially from anticipated results.

References:

1. Comprehensive Care for Joint Replacement Model, Centers for Medicare and Medicaid Services website. https://innovation.cms.gov/initiatives/CJR. Accessed 10-18-16.
2. Ackerman SJ, Tapia CI, Baik R, Pivec R, Mont MA. Use of a bipolar sealer in total hip arthroplasty: medical resource use and costs using a hospital administrative database. Orthopedics. 2014;37(5):e472 – 481.
3. Sah A, Dearborn J. Aquamantys bipolar sealer in primary total knee arthroplasty: experience with 3,172 consecutive knee replacements. Poster presentation at American Academy of Orthopaedic Surgeons Annual Meeting 2012; San Francisco, CA.

Knee replacement surgery is intended to relieve knee pain and improve knee function. There are potential risks with knee replacement surgery such as loosening, wear and infection that may result in the need for additional surgery.

Contacts:
Victor Rocha
Public Relations
+1-901-399-2401

Ryan Weispfenning
Investor Relations
+1-763-505-4626

CARLSBAD, Calif., Nov. 09, 2016 (GLOBE NEWSWIRE) — SeaSpine Holdings Corporation (NASDAQ:SPNE), a global medical technology company focused on surgical solutions for the treatment of spinal disorders, announced today financial results for the third quarter ended September 30, 2016 and updated guidance for 2016.

Summary Third Quarter 2016 Financial Results and Recent Accomplishments

• Revenue of $31.7 million, a decline of 2.9% year-over-year
• S. revenue of $28.5 million, a decline of 5.5% year over year
  • S. orthobiologics revenue of $14.6 million
  • S. spinal hardware revenue of $13.9 million
• International revenue of $3.3 million, a 28.2% increase year over year
• Acquired minimally invasive expandable interbody portfolio technology from NLT Spine Ltd. (NLT), an Israel-based medical device company developing innovative spinal products
• Received 510(k) clearance from the FDA and launched three new products
  • Shoreline™ ACS Anterior Cervical Standalone System, featuring TruProfile™ technology
  • Mariner™ Posterior Lumbar Fixation System, designed to reduce the number of trays needed for surgery
  • Newport™ Extension System, designed to enable minimally invasive approaches in more complex surgical situations

“We continue to make progress towards expanding and upgrading our product portfolio with the launch of several new products and product line extensions. We are also building and strengthening relationships with high-potential distributors who are committed and excited for our new and future products,” said Keith Valentine, President and Chief Executive Officer.

“Revenue in the quarter, however, was impacted by larger than anticipated decline in sales volume of our legacy hardware and orthobiologics products that outpaced sales of our recently launched products, as well as ongoing pricing pressure. We have initiated several targeted, cost-reduction measures which we expect to significantly reduce our cash spend in 2017 while allowing us to continue to invest in the product development, sales and marketing initiatives that will drive future revenue growth.  I am confident that the cadence of new product introductions and traction we are building with new distributors, combined with our recent actions to streamline operations and reduce our cash spend, will put us back on track for growth in 2017.”

Third Quarter 2016 Financial Results

Revenue for the third quarter of 2016 totaled $31.7 million, a decrease of $1.0 million compared to $32.7 million reported for the same period of the prior year. Total revenue in the U.S. was $28.5 million, a 5.5% decrease over the prior year.

Revenue from orthobiologics products was $16.2 million, a 1.7% decrease compared to the third quarter of 2015. The decline in orthobiologics revenue was primarily driven by lower average selling prices and product mix due to increasing pricing pressures in the U.S. market. Revenue from spinal hardware was $15.6 million, a 4.0% decrease compared to the third quarter of 2015. The decline in spinal hardware revenue was primarily driven by lower demand for the Company’s older spinal fusion hardware products and continued pricing pressures in the U.S. market.

Gross margin for the third quarter of 2016 was 56.3%, compared to 46.9% for the same period in 2015.  The increase in gross margin was mainly driven by a $4.4 million charge recorded in the third quarter of 2015 for excess and obsolete spinal fusion hardware inventory, the substantial majority of which was purchased prior to the spin-off and a large portion of which was primarily intended for distribution in international markets.

Operating expenses for the third quarter of 2016 totaled $27.4 million, a decline of 8.7% compared to $30.0 million for the same period of the prior year, primarily the result of lower SG&A expenses.

Net loss for the third quarter of 2016 was $9.5 million, compared to a net loss of $14.2 million for the third quarter of 2015.

Cash and cash equivalents at September 30, 2016 were $20.8 million and the Company had $3.8 million of outstanding borrowings against its credit facility.

2016 Financial Outlook

SeaSpine lowered its estimate for full-year 2016 revenue to a range of $128 to $130 million, reflecting a 2% to 4% decline over full-year 2015 revenue.

Reduction-in-Force and Other Cost-Reduction Initiatives

In response to lower revenue expectations, the Company initiated a number of activities that, collectively, are expected to reduce cash spend in 2017 by approximately $9 million relative to 2016.  In particular, the Company today initiated a reduction-in-force that will contribute to an overall reduction in its current employee base of approximately 8%.

Webcast and Conference Call Information The Company’s management team will host a conference call beginning today at 1:30pm PT/4:30pm ET to discuss the financial results and recent business developments. Individuals interested in listening to the conference call may do so by dialing (877) 418-4766 for domestic callers or (614) 385-1253 for international callers, using Conference ID: 98611494. To listen to the webcast, please visit the investor relations section of the SeaSpine website at www.seaspine.com.

About SeaSpine

SeaSpine is a global medical technology company focused on the design, development and commercialization of surgical solutions for the treatment of patients suffering from spinal disorders. SeaSpine has a comprehensive portfolio of orthobiologics and spinal hardware solutions to meet the varying combinations of products that neurosurgeons and orthopedic spine surgeons need to perform fusion procedures on the lumbar, thoracic and cervical spine. SeaSpine’s orthobiologics products consist of a broad range of advanced and traditional bone graft substitutes that are designed to improve bone fusion rates following a wide range of orthopedic surgeries, including spine, hip, and extremities procedures. SeaSpine’s spinal hardware portfolio consists of an extensive line of products to facilitate spinal fusion in minimally invasive surgery (MIS), complex spine, deformity and degenerative procedures. Expertise in both orthobiologic sciences and spinal fusion hardware product development helps SeaSpine to offer its surgeon customers a complete solution to meet their fusion requirements. SeaSpine currently markets its products in the United States and in over 30 countries worldwide.

Forward-Looking Statements

SeaSpine cautions you that statements included in this news release that are not a description of historical facts are forward-looking statements that are based on the Company’s current expectations and assumptions. Such forward-looking statements include, but are not limited to, statements relating to: revenue expectations for full-year 2016 and estimated reductions in, and the Company’s ability to reduce, cash spend in 2017; the Company’s ability to continue to invest adequately in activities that will drive future revenue growth in light of cost-reduction initiates; and the Company’s ability to achieve revenue growth in 2017.  Among the factors that could cause or contribute to material differences between the Company’s actual results and the expectations indicated by the forward-looking statements are risks and uncertainties that include, but are not limited to: surgeons’ willingness to continue to use our existing products and to adopt our newly launched products; continued pricing pressure, whether as a result of consolidation in hospital systems, competitors or others, as well as exclusion from major healthcare systems, whether as a result of unwillingness to provide required pricing or otherwise; disruption to our existing distribution network as new distributors are added and the inability of new distributors to generate growth, or even offset lost business; the risk that our products do not demonstrate adequate safety or efficacy, independently or relative to competitive products, to support expected levels of demand or pricing, including in ongoing and future studies, the outcomes of which inherently are uncertain; the lack of clinical validation of products in “alpha release” and the fact they may require substantial additional development activities, which could introduce unexpected expense and delay; the risk of supply shortages, including as a result of our dependence on a limited number of third-party suppliers for components and raw materials, or otherwise; third-party payors’ willingness to continue to provide, for our existing products, and to initiate, for our newly launched products, appropriate coverage, coding and reimbursement and uncertainty resulting from healthcare reform, both in the U.S. and abroad; unexpected expense, including as a result of developing and launching new and next generation products and product line extensions; our ability to sustain current operations and to continue to invest in product development, sales and marketing initiatives at levels sufficient to drive future revenue growth in light of cost-reduction initiates; our ability to obtain funding on a timely basis on acceptable terms, or at all, to execute our business strategy; general economic and business conditions in the markets in which we do business, both in the U.S. and abroad; and other risks and uncertainties more fully described in our news releases and periodic filings with the Securities and Exchange Commission. The Company’s public filings with the Securities and Exchange Commission are available at www.sec.gov.

You are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date when made. SeaSpine does not intend to revise or update any forward-looking statement set forth in this news release to reflect events or circumstances arising after the date hereof, except as may be required by law.

Investor Relations Contact Lynn Pieper(415) 937-5402ir@seaspine.com

CAMBRIDGE, Mass., Nov. 07, 2016 (GLOBE NEWSWIRE) — Vericel Corporation (NASDAQ:VCEL), a leading developer of autologous expanded cell therapies for the treatment of severe diseases and conditions, today reported financial results for the third quarter ended September 30, 2016.

Total net revenues for the quarter ended September 30, 2016 were approximately $10.9 million and included approximately $8.3 million of Carticel^® (autologous cultured chondrocytes) net revenues and approximately $2.6 million of Epicel^® (cultured epidermal autografts) net revenues.  Total Carticel and Epicel net revenues for the quarter ended September 30, 2016 were approximately flat compared to total net product revenues in the third quarter of 2015, with Carticel net revenues increasing $0.6 million and Epicel net revenues decreasing $0.6 million compared to the same period in 2015.  While Epicel orders for the quarter ended September 30, 2016 were equal to the number of orders in the third quarter of 2015, the average number of grafts per order was lower in this quarter.  For the nine months ended September 30, 2016, total Carticel and Epicel net revenues were $37.9 million and included over $26.1 million of Carticel net revenues and over $11.7 million of Epicel net revenues.  Total Carticel and Epicel net revenues increased approximately 8% compared to the first nine months of 2015, with Carticel revenue increasing 9% and Epicel revenues increasing 5%, respectively, compared to the same period in 2015.

Gross profit for the quarter ended September 30, 2016 was $4.1 million, or 37% of net revenues, compared to $4.5 million, or 40% of net product revenues, for the third quarter of 2015.  Gross profit for the first nine months of 2016 was $17.1 million, or 45% of net revenues, compared to $16.5 million, or 46% of net product revenues, for the first nine months of 2015.

Research and development expenses for the quarter ended September 30, 2016 were $3.4 million compared to $3.7 million in the third quarter of 2015.  The decrease in third quarter research and development expenses is primarily due to a decrease in research, development, and regulatory consulting expenses for MACI^® (autologous cultured chondrocytes on porcine collagen membrane).  MACI is Vericel’s investigational third-generation autologous cultured chondrocyte product intended for the treatment of symptomatic full-thickness cartilage defects of the knee.  Development expenses for the ixmyelocel-T program were $1.9 million for the third quarter of 2016, which were primarily due to ongoing clinical development activities related to the double-blind portion of the ixCELL-DCM study and preparations for the open-label crossover extension portion of the study.

Selling, general and administrative expenses for the quarter ended September 30, 2016 were $7.0 million compared to $5.7 million for the same period in 2015.  The increase in selling, general and administrative expenses in 2016 is primarily due to the costs associated with Vericel’s new provider of patient support and reimbursement services for Carticel and MACI, if approved, and professional services related to preparing for the potential launch of MACI.

Loss from operations for the quarter ended September 30, 2016 was $6.4 million, compared to $4.9 million for the third quarter of 2015.  Material non-cash items impacting the operating loss for the quarter included $0.7 million of stock-based compensation expense and $0.5 million in depreciation and amortization expense.

Other expense for the quarter ended September 30, 2016 was $0.3 million compared to other income of $0.5 million for the same period in 2015.  The change in other expense for the quarter is primarily due to the change in the fair value of warrants in the third quarter of 2016 compared to the same period in 2015.

Vericel’s GAAP net loss for the quarter ended September 30, 2016 was $6.7 million, or $0.38 per share, compared to a net loss of $4.4 million, or $0.26 per share, for the same period in 2015. Vericel reported an adjusted net loss for the quarter ended September 30, 2016 of $6.5 million dollars, or $0.27 per share, compared to an adjusted net loss of $4.9 million, or $0.21 per share, for the same period in 2015.  The adjusted net loss excludes the non-cash change in the fair value of warrants and the non-cash accumulated dividend on the Series B convertible preferred stock.  The adjusted net loss per share includes common shares reserved as treasury shares received in exchange for the Series A non-voting convertible preferred stock.

As of September 30, 2016, the company had $8.9 million in cash compared to $14.6 million in cash at December 31, 2015.

Recent Business Highlights
During and since the third quarter of 2016, the company:

• Increased total Carticel and Epicel net revenues approximately 8% compared to the first nine months of 2015, with Carticel revenue increasing 9% and Epicel revenues increasing 5%, respectively, compared to the same period in 2015;
• Implemented the new agreement with Dohmen Life Science Services, LLC for patient support services, as well as payer contracting and product reimbursement services, for Carticel and MACI, if approved;
• Increased preparations for the potential launch of MACI in anticipation of the January 3, 2017 PDUFA goal date;
• Received FDA approval for in-house production of 3T3 cells used in the Epicel manufacturing process, which is expected to yield more than $1 million in annual savings in cost of product sales once the current inventory of purchased 3T3 cells is exhausted;
• Entered into an expanded $20 million credit facility and term loan with Silicon Valley Bank and MidCap Financial Services and a $25 million common stock at the market offering program with Cowen and Company, LLC;
• Announced the acceptance of an abstract for presentation on November 14, 2016 at the American Heart Association’s Scientific Sections 2016 entitled: “Reduction in Ventricular Arrhythmias with Ixmyelocel-T: Results from the ixCELL-DCM Trial”; and
• Initiated the open-label crossover portion of the ixCELL-DCM study with the first patient treated in October 2016.

“This is an exciting time for Vericel as we head into our historically strongest quarter of the year, prepare for the potential launch of MACI and expand our promotional efforts for Epicel,” said Nick Colangelo, president and CEO of Vericel. “We believe that the investments we are making to expand our commercial organization and implement new programs to support our patients and other key stakeholders will drive a period of significant growth for the company in 2017 and beyond.”

Conference Call Information
Today’s conference call will be available live at 4:30pm Eastern time in the Investors section of the Vericel website at http://investors.vcel.com/events.cfm. Please access the site at least 15 minutes prior to the scheduled start time in order to download the required audio software if necessary.  To participate in the live call by telephone, please call (877) 312-5881 and reference Vericel Corporation’s third-quarter 2016 investor conference call.  If calling from outside the U.S., please use the international phone number (253) 237-1173.

If you are unable to participate in the live call, the webcast will be available November 7, 2016. A replay of the call will also be available until 7:29 pm (EDT) on November 11, 2016 by calling (855) 859-2056, or from outside the U.S. (404) 537-3406.  The conference ID is 765207.

About Vericel Corporation
Vericel develops, manufactures, and markets autologous expanded cell therapies for the treatment of patients with serious diseases and conditions.  The company markets two cell therapy products in the United States.  Carticel^® (autologous cultured chondrocytes) is an autologous chondrocyte implant for the treatment of cartilage defects in the knee in patients who have had an inadequate response to a prior arthroscopic or other surgical repair procedure.  Epicel^® (cultured epidermal autografts) is a permanent skin replacement for the treatment of patients with deep dermal or full thickness burns greater than or equal to 30% of total body surface area.  Vericel is also developing two additional cell products.  MACI^®(autologous cultured chondrocytes on porcine collagen membrane) is a third generation autologous chondrocyte implant intended to treat cartilage defects in the knee.  Ixmyelocel‑T is an autologous multicellular therapy intended to treat advanced heart failure due to ischemic dilated cardiomyopathy (DCM).  For more information, please visit the company’s website at www.vcel.com.  

Epicel^®, Carticel^®, and MACI^® are registered trademarks of Vericel Corporation. © Vericel Corporation. All rights reserved.

Non-GAAP Financial Measures
Vericel has provided in this release financial information that has not been prepared in accordance with generally accepted accounting principles in the United States, or GAAP.  Vericel believes that the use of these non-GAAP financial measures provides supplementary information for investors to use in evaluating operating performance and in comparing its financial measures with other companies in Vericel’s industry.  The adjusted net loss excludes the non-cash change in the fair value of warrants and the non-cash accumulated dividend on the Series B convertible preferred stock.  The adjusted earnings per share includes common shares reserved as treasury shares received in exchange for the Series A non-voting convertible preferred stock.  Non-GAAP financial measures that Vericel uses may differ from measures that other companies may use.  In addition, non-GAAP financial measures are not required to be uniformly applied, are not audited and should not be considered in isolation or as substitutes for results prepared in accordance with GAAP.

This document contains forward-looking statements, including, without limitation, statements concerning anticipated progress, objectives and expectations regarding the commercial potential of our products and growth in revenues, intended product development, clinical activity timing, regulatory progress, including the potential clearance of MACI, and objectives and expectations regarding our company described herein, all of which involve certain risks and uncertainties. These statements are often, but are not always, made through the use of words or phrases such as “anticipates,” “intends,” “estimates,” “plans,” “expects,” “we believe,” “we intend,” and similar words or phrases, or future or conditional verbs such as “will,” “would,” “should,” “potential,” “could,” “may,” or similar expressions. Actual results may differ significantly from the expectations contained in the forward-looking statements. Among the factors that may result in differences are the inherent uncertainties associated with competitive developments, clinical trial and product development activities, regulatory approval requirements, estimating the commercial growth potential of our products and product candidates and growth in revenues and improvement in costs, market demand for our products, and our ability to supply or meet customer demand for our products. These and other significant factors are discussed in greater detail in Vericel’s Annual Report on Form 10-K for the year ended December 31, 2015, filed with the Securities and Exchange Commission (“SEC”) on March 14, 2016, Quarterly Reports on Form 10-Q and other filings with the SEC. These forward-looking statements reflect management’s current views and Vericel does not undertake to update any of these forward-looking statements to reflect a change in its views or events or circumstances that occur after the date of this release except as required by law. 

CONTACT:             
Chad Rubin
The Trout Group
crubin@troutgroup.com
(646) 378-2947
or
Lee Stern
The Trout Group
lstern@troutgroup.com
(646) 378-2922

8 November 2016

Smith & Nephew (NYSE:SNN; LSE:SN), the global medical technology business, announces that the U.S. health and wellness organization, Provider PPI LLC, has adopted its Episode of Care Assurance Program (eCAP), an innovation designed to mitigate risk associated with readmissions in value-based healthcare reimbursement models. Provider PPI LLC is a subsidiary of Highmark Health that provides group purchasing benefits to the hospitals of Allegheny Health Network and 60 additional healthcare providers in the western Pennsylvania region.

Unplanned readmissions are costly to hospitals, surgeons and patients and can result in significant financial implications under the Comprehensive Care for Joint Replacement Model (CJR) and Bundled Payments for Care Improvement (BPCI) initiative. For patients, an unplanned readmission can turn an elective procedure into an emergent procedure, complicating and extending the 90-day episode of care. For hospitals and surgeons focused on value, as defined by quality outcomes achieved through efficiency, unplanned readmissions can negatively influence overall quality scores.

“We are excited about the significant value that Smith & Nephew’s Episode of Care Assurance Program will bring to our member hospitals,” said Paul Gallagher, VP, Provider PPI.  “Joint replacement and wound care are important, busy clinical service lines for most every hospital in our group and this unique program provides an added level of quality assurance and cost control to their associated bundled payment protocols.”

The eCAP initiative pairs together Smith & Nephew’s entire line of primary total hip and knee reconstructive systems with two of its most innovative wound care products: PICO™ Single Use Negative Pressure Wound Therapy and ACTICOAT™ Flex 7 Silver-coated Antimicrobial Barrier Dressing. Smith & Nephew warrants the performance of its primary total knee systems, primary total hip systems, PICO Single Use Negative Pressure Wound Therapy System and ACTICOAT Flex 7 to perform as expected. If a patient is readmitted within 90 days following a procedure for a surgical site infection or to revise the implant due to a failure of a Smith & Nephew product, Smith & Nephew will pay a hospital’s unreimbursed costs for the readmission up to the purchase prices of the implant, PICO and ACTICOAT Flex 7.

This pioneering program can provide value and help to improve quality associated with lower extremity joint reconstruction surgery (LEJR). Building strong partnerships with healthcare institutions and providers is the core of Smith & Nephew’s mission and has been a central pillar of the company for over 160 years. By providing viable solutions in healthcare, Smith & Nephew supports healthcare professionals in their daily efforts to improve the lives of patients.

Enquiries

About Smith & Nephew

Smith & Nephew is a global medical technology business dedicated to helping healthcare professionals improve people’s lives. With leadership positions in Orthopaedic Reconstruction, Advanced Wound Management, Sports Medicine and Trauma & Extremities, Smith & Nephew has around 15,000 employees and a presence in more than 100 countries. Annual sales in 2015 were more than $4.6 billion. Smith & Nephew is a member of the FTSE100 (LSE:SN, NYSE:SNN).

For more information about Smith & Nephew, please visit our website www.smith-nephew.com, follow @SmithNephewplc on Twitter or visit SmithNephewplc on Facebook.com.

^{Forward-looking Statements}

^{This document may contain forward-looking statements that may or may not prove accurate. For example, statements regarding expected revenue growth and trading margins, market trends and our product pipeline are forward-looking statements. Phrases such as “aim”, “plan”, “intend”, “anticipate”, “well-placed”, “believe”, “estimate”, “expect”, “target”, “consider” and similar expressions are generally intended to identify forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties and other important factors that could cause actual results to differ materially from what is expressed or implied by the statements. For Smith & Nephew, these factors include: economic and financial conditions in the markets we serve, especially those affecting health care providers, payers and customers; price levels for established and innovative medical devices; developments in medical technology; regulatory approvals, reimbursement decisions or other government actions; product defects or recalls or other problems with quality management systems or failure to comply with related regulations; litigation relating to patent or other claims; legal compliance risks and related investigative, remedial or enforcement actions; disruption to our supply chain or operations or those of our suppliers; competition for qualified personnel; strategic actions, including acquisitions and dispositions, our success in performing due diligence, valuing and integrating acquired businesses; disruption that may result from transactions or other changes we make in our business plans or organisation to adapt to market developments; and numerous other matters that affect us or our markets, including those of a political, economic, business, competitive or reputational nature. Please refer to the documents that Smith & Nephew has filed with the U.S. Securities and Exchange Commission under the U.S. Securities Exchange Act of 1934, as amended, including Smith & Nephew’s most recent annual report on Form 20-F, for a discussion of certain of these factors. Any forward-looking statement is based on information available to Smith & Nephew as of the date of the statement. All written or oral forward-looking statements attributable to Smith & Nephew are qualified by this caution. Smith & Nephew does not undertake any obligation to update or revise any forward-looking statement to reflect any change in circumstances or in Smith & Nephew’s expectations.}

^{◊ Trademark of Smith & Nephew.}

November 8, 2016

Seikagaku Corporation (“Seikagaku”) (head office: Tokyo, Japan) today announced that it has entered into an exclusive distributorship agreement in the United States for VISCO-3™, a hyaluronic acid based viscosupplement product which requires three injections for the treatment of knee osteoarthritis pain, with Zimmer Biomet Holdings, Inc. (“Zimmer Biomet”) (head office: Warsaw, Indiana, U.S.A.).

As an aging population is growing in the U.S, expansion of the market for viscosupplement products is expected to continue. The market supports products with different numbers of injections, which are used according to the diverse needs of physicians and patients. Zimmer Biomet has sold Gel-One®, a single-injection viscosupplement product manufactured by Seikagaku, in the U.S. since 2012. With the conclusion of this agreement, Zimmer Biomet adds VISCO-3™ to its product line.

Seikagaku will have a line of products with three different numbers of injections, whole type of injection product, after the introduction of VISCO-3™ in the U.S. market, in addition to the existing Gel-One® single-injection treatment and SUPARTZ FX® five-injection treatment. In its role as the manufacturer of VISCO-3™, Seikagaku will continue to work to increase the presence of its products in the U.S., a key region in the growth strategy, by supporting the sales activities of the sales partner through the provision of academic information and measures to enhance the added value of products.

The impact of this matter on the consolidated financial results for the fiscal year ending March 31, 2017 will be minor and has been taken into account in the revised forecast of consolidated financial results disclosed on November 8, 2016.

< About VISCO-3™, a three-injection viscosupplement product > VISCO-3™, an injectable treatment the active ingredient of which is hyaluronic acid, was approved by the U.S. Food and Drug Administration (FDA) in December 2015 as a medical device indicated for knee osteoarthritis. It is a three-injection kit product for administering a three-dose treatment cycle (three doses given once weekly). Knee osteoarthritis is a disease characterized by the degeneration of articular cartilage and consequent swelling and pain. Injection of hyaluronic acid is a therapy used to curb the progress of symptoms.

< About Zimmer Biomet Holdings, Inc. > Founded in 1927 and headquartered in Warsaw, Indiana, Zimmer Biomet is a global leader in musculoskeletal healthcare. Zimmer Biomet designs, manufactures and markets orthopaedic reconstructive products; sports medicine, biologics, extremities and trauma products; office based technologies; spine, craniomaxillofacial and thoracic products; dental implants; and related surgical products. In the field of viscosupplement products, Zimmer Biomet is the sales partner in the U.S. for Gel-One® , Seikagaku’s single-injection product.

< Cautionary Notes > This press release contains forward-looking statements regarding future management strategies or performance forecasts. These statements are based on judgments derived from information that is currently available to Seikagaku and are subject to risk and uncertainty. Actual results and developments may differ significantly from these forward-looking statements due to various factors. Information about pharmaceutical products or medical devices (including products currently in development) included in this press release is not intended to constitute an advertisement or medical advice.

November 08, 2016