Dive Brief:
- Orthofix Medical announced Andres Cedron, who most recently served as vice president and corporate secretary at the global medical device maker Stryker, has joined the Lewisville, Texas-based spine and orthopedic device maker as its new chief legal officer, according to a company release Tuesday.
- In September the company’s previous CLO, Patrick Keran, was terminated for cause along with then CFO John Bostjancic and CEO Keith Valentine after the company said an investigation found the three executives had engaged in “offensive conduct” that violated multiple code of conduct requirements.
- The new appointment comes on the heels of the company revealing in its 10-K last month a plan to remediate a “material weakness in the design and operation of certain management review controls pertaining to business combinations and assessing recoverability of goodwill” that came to light while management was preparing the report.
Dive Insight:
Cedron’s appointment marks the last of the three embattled roles to be refilled with permanent successors. In January, Julie Andrews, 52, took the firm’s finance reins and Massimo Calafiore, 52, became the company’s new CEO and president, CFO Dive previously reported.
The company is still grappling with fresh challenges when management evaluated its internal control over financial reports while preparing its annual report, according to the annual filing.
The company identified the weakness as “resulting from insufficient evidence supporting the precision over the determination of certain estimates and insufficient evidence supporting the operating effectiveness of the associated review controls.”
While asserting in the annual filing that the material weakness did not result in any misstatements to the consolidated financial statements or disclosures, the company also laid out a plan to address and resolve the weakness by evaluating skill set gaps and hiring additional accounting, finance, and/or financial reporting personnel, providing ongoing training for key people responsible for internal control over financial reporting and enhancing controls over the “completeness and accuracy of information used in financial reporting.”
Orthofix, which has previously declined to comment on the specifics of the conduct that led to the three executives being ousted last year, did not respond to requests for comment Wednesday.
Cedron brings nearly 20 years of executive legal experience, having held such roles as chief legal counsel to Stryker’s MedSurg and Neurotechnology Group. He also previously worked as an associate for the Sullivan & Cromwell law firm, according to his LinkedIn account.
As an inducement to join Orthofix, Cedron was granted performance-based vesting restricted stock units that settle 57,296 shares of common stock at target achievement, time-based vesting restricted stock units that settle into 28,648 shares of common stock and stock options to purchase 64,817 shares of common stock, according to the release which did not include information on his salary.
“With a broad breadth of experience in the medical device industry and legal transactions, Andres is the perfect fit for this important leadership role,” Calafiore said in a statement contained in the release. “His extensive understanding of our business and the overall market will be an asset in helping the company drive profitability and growth as we continue to power Orthofix’s transformation.”
The company reported 2023 net sales rose 62% on a reported basis and 6% on a pro forma constant currency basis year-over-year to $746.6 million while it also reported a net loss for the period of $151.4 million compared to a net loss of $19.7 million in 2022.
