Alphatec (NASDAQ:ATEC) Chief Financial Officer Todd Koning outlined the spine surgery company’s market opportunity, growth strategy and profitability targets during a Bank of America presentation, emphasizing the company’s focus on lateral surgery, data-driven planning tools and newly launched navigation and robotics technology.
Koning said Alphatec sizes its total addressable market at about $10 billion and is “just slightly under 10%” penetrated. He described the broader spine market as healthy, growing at a low- to mid-single-digit rate, and said that leaves room for Alphatec to grow above the market.
Lateral surgery remains central to strategy
Koning said Alphatec has focused heavily on the lateral surgery market, which the company estimates at about $1 billion. He described lateral surgery as one of the faster-growing areas of spine care because it can allow for lower blood loss, a less morbid procedure and faster patient recovery.
He added that Alphatec believes lateral approaches can address a substantial portion of the traditional posterior surgery market, which the company sizes at about $2 billion.
Koning traced the company’s current strategy to a 2018 remake of Alphatec led by Chief Executive Officer Pat Miles and Chief Medical Officer Luiz Pimenta. He said the company set out to understand why lateral surgery had historically addressed only about one-third of its total opportunity, despite what Alphatec views as clinical advantages.
The company’s strategy, he said, continues to center on “clinical distinction” by helping surgeons perform better procedures. Rather than focusing on individual products such as screws or interbody devices, Koning said Alphatec has taken a procedural approach to spine surgery.
He said the company has seen consistent surgeon adoption and increased utilization across cohorts. According to Koning, the presentation slide showed approximately 20% growth each quarter in the number of surgeons using the company’s procedure.
PTP, LTP and procedure economics
Koning said Alphatec’s lateral platform, including PTP and LTP approaches, was designed to address hurdles that limited broader adoption of lateral surgery. He pointed to investments in patient positioning and neuromonitoring, saying the company’s technology allows surgeons not only to avoid nerves when placing a retractor but also to monitor nerve health during the procedure.
“We’re the only company who can do that,” Koning said.
He said Alphatec’s procedural approach helps create a more reproducible surgical experience and allows the company to capture a larger share of revenue from each procedure. Koning said Alphatec’s revenue per procedure has averaged about $12,000 over the past 12 months.
As surgeons gain confidence using PTP and LTP, he said, they often expand adoption into other areas of the company’s portfolio, including ALIF, cervical and deformity procedures.
EOS and data-driven spine care
Koning also discussed EOS, an imaging system Alphatec acquired in early 2021. He described EOS as a standing, full-body, weight-bearing, biplanar and low-dose radiation imaging system that is widely accepted in spine care, particularly in academic settings.
He said the company’s EOS Insight software can use EOS images to create structured data, generate automated alignment measurements, compare those measurements with normative values and help create a surgical plan. That process can include generating a patient-specific rod for the procedure and tracking the patient after surgery using follow-up EOS images.
Koning said the accumulation of longitudinal imaging data could eventually support predictive modeling based on pathology, patient demographics, surgical intervention and outcomes over time.
He added that early experience with EOS Insight has been encouraging. Sites using EOS Insight saw volumes grow about 30% in the six months after implementation compared with the prior six months, according to Koning.
Valence launch and international expansion
Koning said Alphatec launched Valence, its navigation and surgical robot platform, during the past quarter. While many spine robots are designed primarily to place pedicle screws, he said Alphatec has integrated Valence into PTP to support a broader lateral procedure.
He said the platform can help surgeons navigate retractor placement, discectomy, endplate preparation and interbody placement, in addition to navigating and robotically placing pedicle screws. Koning said Alphatec believes this could make lateral surgery more accessible to surgeons with less experience in the approach.
Internationally, Koning said Alphatec’s strategy is “narrow and deep,” focusing on a select set of countries and building direct sales organizations. He cited Australia and New Zealand as markets the company entered a couple of years ago and Japan as a more recent market. Alphatec performed its first PTP in Japan in March, he said.
Profitability, refinancing and guidance
Koning said Alphatec has improved its profitability profile after investing in infrastructure and scale in earlier years. He said the company became positive on adjusted EBITDA in 2024 and is now positive on cash flow.
He also said the company refinanced about $200 million of term debt, saving approximately 300 basis points of interest, or about $6 million per year.
For the year, Koning reiterated guidance that includes:
- 15% top-line growth
- $882 million in revenue
- $134 million in adjusted EBITDA
- $20 million in free cash flow
Koning said Alphatec believes it is positioned to deliver growth above the broader market while continuing to expand profitability and cash flow.
About Alphatec (NASDAQ:ATEC)
Alphatec Holdings, Inc (NASDAQ: ATEC) is a medical technology company focused on the design, development and commercialization of products for the surgical correction of degenerative spinal conditions. The company’s portfolio centers on interbody implants, biologics, fixation devices and surgical planning tools intended to improve patient outcomes in spinal fusion procedures. Alphatec’s flagship offerings include customizable interbody cages, bone graft materials and specialized instrumentation designed for minimally invasive and open spinal surgeries.
Founded as Alphatec Spine in 1985 and rebranded as Alphatec Holdings in 2018, the company has grown from a single-product organization into a multi-platform innovator in the spine market.
