At a Glance

  • Orthofix Medical announced on Tuesday the appointment of Andres Cedron as its new chief legal officer. Cedron, who previously served as vice president and corporate secretary at global medical device manufacturer Stryker, joins the spine and orthopedic device company headquartered in Lewisville, Texas.
  • In September, the company's former chief legal officer Patrick Keran, former chief financial officer John Bostjancic, and CEO Keith Valentine were dismissed after an investigation found they had engaged in "offensive conduct" that violated multiple codes of conduct.
  • The appointment comes as the company disclosed in its 10-K filing last month a remediation plan to address "material weaknesses in the design and operation of certain management review controls related to the assessment of business combinations and goodwill recoverability," which were identified during management's preparation of the report.

Deep Dive

Cedron's appointment marks the last of these three controversial executive positions to find a permanent successor. In January, Julie Andrews, 52, took over the company's financial reins, and Massimo Calafiore, 52, became president and CEO, CFO Dive previously reported.

The company faces new challenges even as management assessed internal control over financial reporting during the preparation of its annual report, the annual filing shows. The company attributed the weakness to "insufficient evidence to determine the precision of certain estimates and insufficient evidence of the effectiveness of the operation of related review controls."

Although the company stated in the annual filing that the material weakness did not result in any misstatement in the consolidated financial statements or disclosures, it also developed a plan to address and remediate the weakness by evaluating skill gaps and hiring additional accounting, finance, and/or financial reporting personnel, providing ongoing training to key personnel responsible for internal control over financial reporting, and strengthening controls over the "completeness and accuracy of information used in financial reporting."

Orthofix previously declined to comment on the specific conduct that led to the removal of the three executives last year and did not respond to a request for comment on Wednesday.

Cedron brings nearly 20 years of executive legal experience, having served as chief legal counsel for Stryker's MedSurg and Neurotechnology group. According to his LinkedIn profile, he also worked as an attorney at the law firm Sullivan & Cromwell.

As an incentive to join Orthofix, Cedron received performance-based restricted stock units (settling in 57,296 shares of common stock upon achievement of targets), time-based restricted stock units (settling in 28,648 shares of common stock), and stock options to purchase 64,817 shares of common stock; his salary information was not included in the announcement.

"Andres brings extensive experience in the medical device industry and legal transactions, making him the ideal candidate for this important leadership role," Calafiore said in a statement in the announcement. "His deep understanding of our business and the overall market will help drive profitability and growth as we transform Orthofix."

The company reported that 2023 net sales increased 62% year-over-year on a reported basis and 6% on a pro forma constant currency basis, reaching $746.6 million; net loss for the period was $151.4 million, compared with a net loss of $19.7 million in 2022.