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The beauty of high gross margin products like electrical bone stimulators

30 May 2025 · 1 min

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In this brief first‑person account, the former Director of Sales at Orthologic recounts how he helped grow the company’s revenue from roughly $3 million to $28 million in just 2.5 years. The business was subsequently acquired by DonJoy, but the acquisition coincided with a corporate scandal: the CEO received a warning letter, sold options, and the stock price collapsed, turning many executives from multimillion‑dollar shareholders into modest earn‑outs. Despite the turmoil, the core product—a bone growth stimulator—maintained an extraordinary 90 % gross margin. The buyer, DonJoy, expected the margin to erode, yet the device has remained in its portfolio for over two decades, still delivering the same high margin. The speaker uses the story to illustrate how certain medical‑device products can sustain ultra‑high profitability long after market changes and corporate upheavals.

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Director of Sales at Orthologic and how, and we took it from like $3 million to $28 million in 2.5 years. And it was a great story. The CEO got a warning letter and sold some options and stock and we got in trouble and the stock fell. You know, everybody went from being a millionaire to just get a, you know, walking away with a couple hundred thousand. And it was a disaster in some ways, but the product. Had a 90% margin and it eventually, and he was president of DonJoy, the guy I was talking to at the time. They bought it thinking that it would be, you know, it couldn't last at 90% and that certainly the industry would never pay that amount for this bone growth. It was a bone growth stimulator. And as long as they kept it for 5 years, they would, you know, recoup their investment and make money. The reason this, it was kind of funny was he said that product is still in their portfolio making 90% margin. This is like, this is 20 years ago.