Next Year's EBITDA and Leverage
Q: Is EBITDA expected to match set deployment costs next year?
A: Yes, OrthoPediatrics expects adjusted EBITDA in 2025 to cover set deployment investments, which will be less than $20 million, and achieve cash flow breakeven by 2026. Leverage will come from increased volume, G&A savings, and 2–3 points of additional leverage on sales and marketing.

EBITDA Ramp and Clinic Expansion
Q: How will EBITDA ramp reconcile with clinic expansion costs?
A: The EBITDA ramp is driven by organic implant growth and increased ROI from clinics. Investments in new clinics involve lease build-out costs and deploying sets, which impact depreciation but not adjusted EBITDA negatively. High-margin bracing products will contribute to profitability.

Boston O&P Growth and Clinic Expansion
Q: Is Boston O&P still expected to contribute $25 million annually?
A: Yes, Boston O&P is expected to contribute $25 million annually. The company sees significant opportunities for clinic expansion, and the recent capital raise is connected to funding this growth strategy in the OPSB franchise.

Economics of New Clinics
Q: What are the investment and ROI for new clinics?
A: Opening a new clinic requires about $0.5 million upfront for leasing, build-out, and hiring clinicians. These clinics are expected to be cash flow positive within 3 to 4 months, leading to aggressive growth thereafter.

Specialty Bracing Integration
Q: How is the integration of Boston O&P progressing?
A: Integration is going extremely well, with the OPSB portfolio now essentially integrated into the Boston business. There is significant opportunity in clinic expansion, and the Nationwide Children's Hospital clinic is expected to be substantial, contributing to growth in 2025 and beyond.

Guidance and Conservatism
Q: Why hasn't guidance been raised despite positive outlook?
A: The company maintains a conservative guidance policy, even after a small beat and robust summer season. Potential impacts from RSV and flu season in Q4 are wildcards, so guidance assumes a similar environment to last year. Organic growth was around 18% excluding the Boston O&P acquisition.

Stock Repurchase
Q: Why did the company initiate a $5 million stock buyback?
A: The $5 million stock repurchase is related to the convertible notes offering; it effectively raises the strike price from $30 to about $50. It is directly associated with the convertible financing strategy and not indicative of other uses of capital.

International Scoliosis Growth
Q: Are international scoliosis numbers expected to improve?
A: Yes, despite choppy results due to stocking distributor patterns in South America, the company is confident in strong second-half growth. Demand remains strong, and international business is set up nicely with growth in Europe and Canada expected to stabilize revenues.

Competitive Landscape in Scoliosis
Q: Can you capitalize on competitors' market changes?
A: Yes, recent M&A has distracted competitors focused on adult spine, allowing OrthoPediatrics to reaffirm its exclusive commitment to pediatric orthopedics. This focus is well-received by customers and is driving growth through specialized products addressing unmet needs.

eLLi Growing Rod Approval
Q: What is the approval path for the eLLi Growing Rod?
A: The company expects a 510(k) approval pathway for the eLLi Growing Rod, with FDA pediatric breakthrough device designation supporting this. They anticipate launching in 12–18 months, with no clinical data required for approval, though post-market data collection is planned.

Enabling Technologies Update
Q: Any updates on 7D and FIREFLY technologies?
A: The 7D technology is well-received for radiation-sparing navigation in pediatric surgery and is opening doors in facilities. Recent certification allows for fully navigated spine surgery without radiation, which is significant for growth of the fusion franchise.