Exactech Declares Bankruptcy

Exactech, founded by orthopedic surgeon Dr. Bill Petty in 1985, evolved into a big player in the orthopedic space, achieving revenues of $257 million in 2023. However, the company faced challenges due to litigation related to polyethylene, which jeopardized its stability. As a result, Exactech filed for bankruptcy this week. 

Litigation focused on polyethylene in hips, knees, and ankles

Most of Exactech’s legal troubles stemmed from a voluntary recall in 2021 of implant devices due to “non-conforming packaging,” which inadequately protected the devices from exposure to oxygen. Patients who received these faulty devices filed lawsuits, claiming that Exactech had failed to ensure the durability and safety of its implants. The recall included hip, knee, and ankle products. The combination of these legal battles, along with the costs of managing the recall and replacing defective products, created financial strain on the company. Some sources estimate these expenses to be at around $20 million over the past year. 

What now?

On October 29, Exactech’s President Derrin Johnson announced that the company has entered into a comprehensive restructuring support agreement with a group of existing investors. During the restructuring process, Exactech will continue its normal operations, and the restructuring is expected to alleviate the company from its non-operating legacy liabilities.