I got out (at a loss), but thought I would post the basics of a conversation I had with my neighbour on the weekend in case it's of some benefit to people here. He's a rep in Johnson & Johnson's Medical Devices dept in Australia, a competitor to Osteopore. He knew about OSX, but not much. As a disclaimer, he doesn't have much to do with the other parts of J&J's global empire, just the Australian operations. Our conversation was as neighbours, not investors, so feel free to write this off as simply anecdotal.
I mentioned my surprise about OSX's low sales, given how long they've been selling their products and how many good patient outcomes they can claim. I quoted the stat that impressed me when I bought in: their products have been used in over 50,000 operations so must be well-known by surgeons. My neighbour agreed, saying that was a very good number for a year in Australia. I was a bit shocked by that and said: No, actually that's for 20 years and throughout the world. To which my neighbour replied that this is an insignificant number.
That led directly to my next question, about the oft-claimed addressable market size of $100 billion worldwide. To which he guffawed, telling me that J&J commands 30% of the med devices market worldwide, and their annual take (globally) is $10 billion (i.e the total market is $30 billion).
Next question was why he thought Osteopore hadn't had any serious market penetration. That led to a long explanation of the time, money and effort that J&J puts into relationship building. In a nutshell, they start the process when the surgeons-to-be are in their final year of uni. It continues with serious interaction over the course of the surgeon's career. They also have different teams working within the three arenas reflecting the difference and importance of each: government; hospital admin and procurement; surgeons. That's a helluva lot more than OSX's sales teams do, I would think.
We covered a lot of ground, but generally I was interested in his opinion of OSX's prospects. He said the realm is hugely competitive and just not practicable for a small player because it requires so much money to stay in, let alone succeed in. He was impressed by the products OSX offers and thought disruption is indeed the coming threat (to J&J). But the threat was too far off, and OSX too small, to be concerned about now. His metaphor was a huge meteor hitting earth. I countered by saying that disruptors can quickly change the landscape (e.g Afterpay). His reply was along the lines of: If they could have, they would have by now.
My last question was whether he thought J&J might be interested in a takeover, given that they could remove a competitor and eliminate a threat (albeit a small and distant one) for a very cheap price. He doesn't work in M&A, so didn't know.
Anyway, good luck to all who still hold, I hope things turn around.
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