X-Spine Systems to Shut Down, Lays Off 54 Employees

X-Spine Systems, a division of Xtant Medical Systems, is shutting down a facility in Ohio and terminating 54 people between December and February 2018.

In early October, X-Spine parent company Xtant announced the closure of the Ohio facility and the shift of all operations to the company’s headquarters in Belgrade, Mont. headquarters. Xtant said the decision would allow it to align operations with “the current and future needs of its customers, and recognize cost-savings by consolidating facilities and reducing duplicative resources.”

In the Oct. 6 announcement, Carl O'Connell, chief executive officer of Xtant, said the decision to shutter the Ohio X-Spine operations is part of an effort to “maximize the benefit” of the 2015 merger and “optimize synergies including efficiencies and cost savings.” He noted in his statement that it was a difficult decision to close the X-Spine operation in Ohio.

“Hardware will continue to be an important aspect of our business, and is an area we intend to build on in the future. We remain excited about the new technologies in development. With the continued efforts in 2017 towards restructuring and reducing costs, we are looking to strategically invest in both our existing business and new market opportunities, for hardware and biologics in 2018. We will be working to make this transition as smooth as possible for our employees and our customers,” O'Connell said in a statement.

Xtant said the consolidation plan and termination of the Ohio facility will result in annualized cost savings in excess of $2 million that will result from “right-sizing” the company. Xtant said it expects to incur about $1.5 million in charges for the closure of the Ohio facility.

The company sent a WARN notice to the Ohio government announcing its intentions. Employees were told of their termination and the closure on Oct. 6, the Dayton Business Journal reported, citing Julie Smith, the human resources director for Xtant Medical.

X-Spine developed spinal implants and other medical instruments. In 2015, it was acquired by Bacterin, which rebranded into Xtant Medical. At its height, X-Spine served more than 350 surgeons across 450 hospitals, the Journal noted.  

Last week, Xtant showcased its spinal portfolio at the North American Spine Society annual meeting in Orlando. Xtant featured its OsteoSponge product line, 3Demin fiber technology, OsteoVive viable cell allograft at the meeting. Additionally, it showed off its OsteoSelect DBM Putty formulations and other biologic scaffolds, the company said in a statement. Xtant also displayed its Silex, Irix-A, Irix-C, Certex, and other hardware product lines.

Xtant is expected to announce its third quarter results on Nov. 8