Zimmer Biomet Holdings, Inc. ZBH recently received Food and Drug Administration (“FDA”) Premarket Approval Application (“PMA”) Supplement approval for the Oxford Cementless Partial Knee. The approval is based on safety and effectiveness data from an Investigational Device Exemption (“IDE”) study and non-clinical testing for cementless partial knee replacement (“PKR”).

With this, Oxford Cementless Partial Knee becomes the only FDA-approved cementless partial knee implant in the United States. The latest FDA PMA Supplement approval expands the company’s Knees product portfolio. 

ZBH’s Likely Stock Trend Following the News

Following the announcement, shares of ZBH moved 0.9% north to $112 in yesterday’s aftermarket trading session. 

The company has been gaining high level of synergies from its expanding Knees business. Per the latest update, the company expects the penetration rate of cementless knees to increase drastically in 2024, banking on new product launches. As per the plan, Zimmer Biomet aims to cater to the unmet United States’ demand for a cementless partial knee with its Oxford Cementless Partial Knee. Henceforth, we expect market sentiment to remain positive for ZBH stock in the upcoming days. 

ZBH currently has a market capitalization of $22.09 billion. Its earnings surpassed estimates in three of the trailing four quarters and missed in one, delivering an average surprise of 1.76%.

Features of ZBH’s Oxford Cementless Partial Knee 

The Oxford Cementless Partial Knee helps surgeons perform a PKR with improved fixation, better long-term implant survival rate, and improved efficiency in the operating room. 

The system features a mobile bearing that can move with the femoral component throughout the entire range of motion to mimic natural knee movement. This design provides a better range of motion, a more natural feel and a more stable implant-to-bone fixation for improved long-term implant survival. This feature amplifies the benefits of a traditional partial knee replacement among younger and more active patients as it provides knee flexion that resembles natural knee movement. 

The system's tibial and femoral components have a titanium and hydroxyapatite coating to promote bone growth into the implant.  

More on the News

Since its initial launch in England in 2004, the Oxford Cementless Partial Knee has become the preferred partial knee implant for Zimmer Biomet's customers in Europe. The system has more than 20 years of clinical experience and 300 million plus procedures across Canada, Europe, Middle East, Africa and Asia. 

The company expects a nationwide launch of the Oxford Cementless Partial Knee in the first quarter of 2025. As a part of the launch, Zimmer Biomet will provide FDA-required training, focusing on the cementless surgical technique and proper patient selection. 

Industry Prospects Favour ZBH

Per a report by SkyQuest, the global knee replacement market size is expected to reach $16.99 billion by 2031, at a compound annual growth rate of 5.67% during 2024-2031. Key factors responsible for the market growth include the rising incidence of osteoarthritis and expanding demand for joint replacement surgeries. 

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Accordingly, the rise in the prevalence of knee replacement surgeries is expected to propel the global partial knee replacement market growth. Usage of partial knee replacement continues to grow around the world as published research continues to demonstrate that PKR in appropriate cases provides improved patient outcomes compared with total knee replacement. 

Recent Developments by ZBH

Earlier this month, Zimmer Biomet received a CE Mark for its Persona Revision Knee System. This latest development expands the Persona Knee System portfolio and supports Zimmer Biomet's commitment to personalized solutions. 

ZBH’s Price Performance

In the past year, shares of ZBH have lost 2.5% against the industry’s 20.6% growth. 

ZBH’s Zacks Rank and Key Picks

ZBH currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader medical space are Haemonetics HAE, Penumbra PEN and ResMed RMD. While ResMed sports a Zacks Rank #1 (Strong Buy) at present, Haemonetics and Penumbra carry a Zacks Rank #2 (Buy) each. You can see the complete list of today’s Zacks #1 Rank stocks here.

Haemonetics has an earnings yield of 5.02% compared with the industry’s 1.18%. Its earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 19.39%. The company’s shares have risen 1.8% compared with the industry’s 23.1% growth in the past year. Estimates for HAE’s 2025 EPS have moved north 0.4% to $4.59 in the past 30 days. 

Estimates for Penumbra’s 2024 EPS have moved north 8.1% to $2.79 in the past 30 days. Shares of the company have surged 60.6% in the past year compared with the industry’s growth of 32.7%. PEN’s earnings surpassed estimates in three of the trailing four quarters and missed in one, delivering an average surprise of 10.54%.

Estimates for ResMed’s fiscal 2025 EPS have risen 2.7% in the past 30 days. Shares of the company have surged 86.3% in the past year compared with the industry’s 32.1% growth. RMD’s earnings surpassed estimates in each of the trailing four quarters, the average beat being 6.4%. In the last reported quarter, it delivered an earnings surprise of 8.4%.

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