Centinel Spine IPO: how the business makes money

Hospitals, surgery centers and overseas distributors pay Centinel Spine for prodisc implants that replace worn spinal discs; about half of its revenue goes on selling them.

• 01Of every $100 that came in during FY2025, Centinel Spine spent $103.2, a loss of $3.2. Selling and marketing alone took $49.5.
• 02The S-1 says it had net losses from 2017 until the six months to Jun 30, 2026. Net income in that half-year was $10.2 million, including $3.9 million of other income.

New shares sold by the company

Not yet in the filing

To list on

NYSE

Proposed ticker

CNTL

Lock-up on existing holders

180 days

• 01New shares: the company sells all the Class A shares, so the money, after underwriting costs, goes to it. No existing stockholders are listed as sellers.
• 02The underwriters get a 30-day option to buy extra shares from the company. The S-1 leaves that number blank.
• 03The number of shares, price range and money raised are all blank. An amended registration statement (S-1/A) would add them.
• 04The filing-fee exhibit lists $100 million, "Estimated solely for the purpose of computing the amount of the registration fee." It includes the underwriters' option. The S-1 itself states no offering size.
• 05The company is an "Up-C". The new parent, Centinel Spine Holdco, will own only units of the operating business, Centinel Spine, LLC, and will control it.
• 06Some existing owners, called Continuing Equity Owners, keep units in that LLC instead of parent shares. They also hold Class B shares, which vote but carry no economic rights.
• 07A Tax Receivable Agreement makes the parent pay certain existing owners 85% of certain tax benefits it realizes or is deemed to realize.
• 08At the IPO, preferred units and convertible notes convert. Unconverted 4.42% notes become Class A shares at a 30% discount to the IPO price, so the share count changes.
• 09The company intends to apply to list on the NYSE under the ticker CNTL. The offering depends on that listing being approved, per the S-1.

The company, its directors, executive officers and substantially all other stockholders agree not to sell for 180 days after the prospectus date. The three lead underwriters can release shares early, per the S-1.

Underwriters

5 named in the S-1 (lead: Morgan Stanley & Co. LLC, Goldman Sachs & Co. LLC, Piper Sandler & Co.)

Controlled company

The S-1 does not say Centinel Spine will be a controlled company under NYSE rules.

Lead underwriters

Morgan Stanley & Co. LLC, Goldman Sachs & Co. LLC, Piper Sandler & Co.

Transfer agent

Left blank in the S-1 dated Oct 7, 2026

Learn: How to read an S-1: Anthropic's IPO registration statement · Dual-class shares: when votes and ownership don't match · IPO lock-up agreements: what they are and when they end

• Pay the expenses of the offering and the pre-IPO reorganizationNo amount is in the filing yet. The money buys new units of Centinel Spine, LLC. The S-1 lists these uses for it and states no priority among them.Amount not fixed
• Repay the term notes under the 2023 Credit Agreement, due Sep 30, 2030, with interest at 10% and a make-whole amount (an early-repayment charge)The lenders are controlled by some of the company's equity holders and board observers, per the S-1. About $12.5 million was outstanding at Jun 30, 2026. The make-whole amount is about $7.2 million if repaid before Dec 31, 2026.Goes to an affiliate of the company, as the S-1 states.Amount not fixed
• Repay part of the Term Loan due Mar 1, 2030 (interest at SOFR, a benchmark rate, plus 5.30%)No amount is in the filing yet. The S-1's summary also names paying down the 2025 Credit Agreement, with its exit fee; the Use of Proceeds section lists only the Term Loan.Amount not fixed
• Sales and marketing, sales infrastructure, patient awareness and medical educationNo amount is in the filing yet.Amount not fixed
• Research, development and clinical work, including a two-level use for prodisc C and a hybrid use for the prodisc C familyNo amount is in the filing yet. The S-1 says FDA approval of these uses is not guaranteed.Amount not fixed
• Capital spending, plus more instrument sets and implant inventoryNo amount is in the filing yet.Amount not fixed
• General corporate purposesThe remainder. The S-1 says the company has broad discretion and no current agreements for acquisitions.Amount not fixed

The S-1 gives no amounts and says the company has broad discretion. Lenders under one loan being repaid are controlled by some of its equity holders and board observers.

Only the shares the company sells raise money for it; money from shares sold by existing stockholders goes to them.

Learn: IPO lock-up agreements: what they are and when they end

• Prodisc C family (neck, or cervical)

  4 systems: prodisc C, C Vivo, C SK and C Nova. The original prodisc C is approved for one level, meaning one disc. Two-level C Vivo and C SK launched in the US in 2025, and the FDA approved two-level C Nova on Sep 9, 2026.

• Prodisc L (lower back, or lumbar)

  1 system, with Anatomic Endplates. Its two-level version launched in the US in 2020.

• Instruments and surgeon training

  Two instrument systems support the implants. The company trained about 800 US surgeons in 2025, up 23%, and says about 70% of them then did a prodisc procedure.

• Hospitals and ambulatory (outpatient) surgery centers

  Not disclosed

  They are the customer when a non-stocking distributor handles the sale. The company records revenue when the implant is used in surgery. The S-1 gives no revenue share for this group. By region, the United States was 85.5% and outside the United States 14.5% of revenue in the six months to Jun 30, 2026 (Cityfort calculation from S-1 filed Oct 7, 2026).

• Stocking distributors abroad

  Not disclosed

  They are the customer for their sales outside the US. The company records revenue when it ships. Sales outside the US were about 15% of revenue in the six months to Jun 30, 2026, per the S-1.

1. 1Customers paid $132.2 million for prodisc implants in FY2025. A foreign currency gain added $4.1 million.
2. 2Making them cost $26.1 million, which left $106.0 million of gross profit (revenue minus product costs).
3. 3Operating costs took $90.3 million, of which selling and marketing was $67.5 million. That left $15.7 million of operating income.
4. 4Interest took $11.1 million and a loss on refinancing debt $3.5 million. Other expense, mainly non-cash warrant and derivative losses, took $9.4 million.
5. 5After $0.2 million of tax, costs were $4.3 million more than the money that came in. That is the net loss.

Each line = amount ÷ total money in × 100. Lines may not add to exactly $100 because of rounding.

• Outside manufacturers

  Third parties make substantially all implants and instruments. Five vendors were 94% of FY2025 inventory purchases, up from 91% in FY2024. The S-1 names single or sole sources including Hammill Manufacturing and Bricon.

• FDA approvals

  Its 5 products are Class III devices, the category that needs FDA premarket approval (PMA). The S-1 counts 2 PMA approvals, 2 panel-track PMA supplements and 49 other PMA supplements.

• Sales network

  In the US, more than 400 independent distributors, with 48 sales management and clinical support staff (the filing also gives 46 and 45). Commissions drove most of the $18.1 million rise in FY2025 selling costs, at $11.3 million, per the S-1.

• Insurance coverage

  The S-1 calls commercial cervical coverage "near universal" for one and two levels. Lumbar is about 95% of covered lives for one level and about 45% for two, including payors with no negative policy.

• Medicare payment rates

  The company's internal analyses put the 2026 average outpatient facility payment at $17,913 for cervical TDR and $13,116 for ACDF, a neck fusion. Medicare has covered lumbar TDR in outpatient and surgery-center settings since Jan 1, 2026.

• People

  138 full-time employees at Jun 30, 2026: 123 in the US and 15 abroad, with no unions, per the S-1.

• Medtronic PLC

  Named in the S-1 as offering TDR products that compete directly with prodisc.

• Globus Medical Inc.

  Named in the S-1 as offering TDR products that compete directly with prodisc.

• Highridge, Inc.

  Named in the S-1 as offering TDR products that compete directly with prodisc.

• Spineart SA

  Named in the S-1 as offering TDR products that compete directly with prodisc.

• Spineway Group

  Named in the S-1 as offering TDR products that compete directly with prodisc.

• More US surgeons

  Working

  1,736 active and 334 high-volume surgeons at Jun 30, 2026, up 33% and 39% (S-1)

  The company estimates about 3,100 US surgeons did a TDR in 2 years, and about 85% of those did fewer than one a month.

  Status: Working, on track against what the company said.

• Two-level neck implants

  New

  FDA approved two-level C Nova on Sep 9, 2026 (S-1)

  Two-level C Vivo and C SK launched in 2025. The company withdrew the original prodisc C from the C Nova supplement to secure earlier approval, per the S-1.

  Status: New, recently announced.

• Lumbar in outpatient settings

  New

  Medicare coverage in outpatient and surgery-center settings from Jan 1, 2026 (S-1)

  The S-1 puts commercial lumbar coverage at about 95% of covered lives for one level and about 45% for two.

  Status: New, recently announced.

• Hybrid use in the neck

  Early

  FDA pre-submission talks in March 2026 (S-1)

  Hybrid means a disc replacement next to a fusion. Part of the money raised funds this work; the S-1 says approval is not guaranteed.

  Status: Early, too early to judge.

• Sales outside the US

  Mixed

  $12.4 million in the six months to Jun 30, 2026, up from $10.5 million (S-1)

  International share of revenue fell to about 15% from 16% in FY2025. The company describes its plan as selected international growth.

  Status: Mixed, partly on track.

Status compares progress with what the company itself said it would do: Working = on track against what the company said; Mixed = partly on track; Behind = behind the company's own plan; New = recently announced; Early = too early to judge.

EBITDA here = operating income plus depreciation and amortization (from the cash flow statement). Fiscal years are the company's own (December 31). Net profit is the share belonging to the company's owners.

Centinel Spine says in its S-1 that it is an emerging growth company, so the filing gives two audited years instead of three.

Learn: Stock-based compensation and dilution: pay that becomes shares

• Official (GAAP): Net loss, FY2024

  −$12.1M

  Company's own measure: Adjusted EBITDA, FY2024

  $5.9M

  The company's measure: net income or loss before interest, income tax, depreciation and amortization, foreign currency, other income or expense, and non-recurring items such as a loss on extinguishing debt.

• Official (GAAP): Net loss, FY2025

  −$4.3M

  Company's own measure: Adjusted EBITDA, FY2025

  $20.2M

  Same definition. Among other items, it leaves out $11.1 million of interest, $9.4 million of other expense and the $3.5 million debt loss.

• Official (GAAP): Net income, six months to Jun 30, 2026

  $10.2M

  Company's own measure: Adjusted EBITDA, six months to Jun 30, 2026

  $15.5M

  Same definition. Among other items, it leaves out $5.5 million of interest and takes out $3.9 million of other income.

• Official (GAAP)

  No official figure measures this; it is the company's own operating measure.

  Company's own measure: Active US surgeons, Jun 30, 2026

  1,736 surgeons

  The company's measure: any US surgeon who did at least one prodisc TDR in the preceding four quarters. Up 33% from a year earlier, per the S-1.

• Official (GAAP)

  No official figure measures this; it is the company's own operating measure.

  Company's own measure: High-volume US surgeons, Jun 30, 2026

  334 surgeons

  The company's measure: active surgeons who did 12 or more procedures in the preceding four quarters. Up 39% from a year earlier, per the S-1.

These are the company's own measures, defined by the company. They are not comparable across companies, and they are not added together. Each sits beside the nearest official (GAAP) figure.

Learn: Non-GAAP measures: what a company's "adjusted" numbers leave out

• Net debt of $111.0 million is a Cityfort calculation from S-1 filed Oct 7, 2026: stated debt minus cash.
• On the balance sheet, the note, convertible note and term note lines carry $59.7 million, $62.1 million and $12.5 million. That basis differs from the stated debt.
• The principal and accrued interest of both the 6% and the 4.42% convertible notes convert into Class A shares at the IPO, and the Term Loan is only partly repaid. The S-1 leaves the figures after the offering blank, so debt then is not known.
• The Term Loan is $60.0 million from SLR Investment Corp., due Mar 1, 2030, with $2.5 million monthly repayments from Mar 1, 2028. It has a minimum revenue covenant, which the company met at Jun 30, 2026.
• Total members' deficit was $187.1 million, shown here as net worth. Accumulated deficit, a different line, was $188.4 million. Preferred units of $83.0 million and $50.4 million sit outside equity.
• Working capital was $53.4 million at Jun 30, 2026, as stated in the S-1.

From the prospectus table of principal stockholders. Holdings fall after the IPO when new shares are sold; the prospectus also shows the holding after the offering.

• Steven Murray

  Chief Executive Officer · since 2020

  Age 65. Earlier worked in Johnson & Johnson divisions. FY2025 total pay was $1,008,832, per the S-1.

• Varun Gandhi

  Chief Financial Officer · since 2020

  Age 42. Worked at Viscogliosi Brothers as an analyst from Sep to Dec 2005. While there from Jan 2006 to Sep 2014, he spent most of his time on services to Small Bone Innovations. From Oct 2014 to Sep 2019, while there, he was in Centinel's senior leadership. FY2025 total pay was $781,084, per the S-1.

• Anthony Viscogliosi

  Director · since 2017

  Representative of Viscogliosi Brothers, LLC, a 5% holder, since the company was formed. Sits on the audit committee.

• Marc Viscogliosi

  Director · since 2020

  Representative of Viscogliosi Brothers, LLC, a 5% holder.

• Robert Donohue

  Director · since 2017

  Representative of AW Alpha Capital LLC, a 5% holder. Sits on the audit committee.

• Craig Greener

  Director · since 2023

  Representative of AW Alpha Capital LLC, a 5% holder.

• Deepankar Panigrahi

  Director · since 2018

  Representative of Delac Spine Inc., whose sole stockholder is Oman Investment Authority. Sits on the audit committee.

• Ali Abdullah Al Amri

  Director · since 2023

  Representative of Delac Spine Inc., whose sole stockholder is Oman Investment Authority, a sovereign wealth fund.

• Dirk Kuyper

  Director and audit committee chair · since 2018

  Bought $100,000 of the company's 4.42% convertible notes, per the S-1.

Auditor

Ernst & Young LLP, since 2018

Auditor changes

None in the period covered

Audit qualifications

None reported

Related-party dealings

Centinel Spine borrows from people and firms tied to its board. Viscogliosi entities, Delac Spine, AW Alpha, Steven Murray and Dirk Kuyper bought 4.42% convertible notes. Entities controlled by some equity holders and board observers lent under the 2023 Credit Agreement.

Credit rating

No public credit rating found

• The 4.42% convertible notes were about $46.0 million of principal plus $6.9 million of accrued interest at Jun 30, 2026.
• Buyers of those notes include Viscogliosi Brothers ($16,860,496), Delac Spine ($10,000,000), AW Alpha ($5,000,000), Steven Murray ($450,000) and Dirk Kuyper ($100,000), per the S-1. VB Watermark Holdings and two VB Venture Partners funds bought $2,000,000, $1,514,720 and $993,600.
• Under the 2023 Credit Agreement, the company borrowed about $5.25 million from entities controlled by some equity holders and board observers. About $12.5 million was outstanding at Jun 30, 2026.
• MCRA, then majority owned by Viscogliosi Brothers, was paid about $2.0 million in FY2024 and $3.3 million in FY2023. It was sold on Jul 31, 2024.
• Summit Orthopedic Technologies, a contract manufacturer, was paid about $0.2 million in FY2025. A subsidiary of VB Watermark Holdings sold its interest in August 2026 and keeps a 5% phantom equity interest.
• The Tax Receivable Agreement pays 85% of certain tax benefits to two classes defined in the S-1: Continuing Equity Owners (existing owners who keep units in Centinel Spine, LLC) and Blocker Stockholders (the owners of Delac Spine and Centinel Spine Holdings, two corporate holders of LLC interests). The S-1 lists it as a related-party transaction.

Cases are listed as the offer document describes them. A pending case is an allegation until a court or regulator decides it.

• Concentration

  All revenue comes from prodisc

  The S-1 lists reliance on one product family as a risk. A problem with prodisc would affect all $132.2 million of FY2025 revenue.

  Watch New uses and sizes approved by the FDA, and any change in revenue sources.

• Debt

  Debt and lender covenants

  Stated debt was $136.1 million at Jun 30, 2026, against $25.1 million of cash. The Term Loan has a minimum revenue covenant, and interest cost $11.1 million in FY2025.

  Watch Debt after the offering, once an amended S-1 fills in the figures.

• Demand

  Surgeons may stay with fusion

  The S-1 says surgeons may not move from fusion. It cites about 750,000 US fusions against about 58,000 TDR procedures in 2025, and estimates about 85% of recent TDR surgeons did fewer than one a month.

  Watch Active and high-volume surgeon counts in later filings.

• Concentration

  Few manufacturers

  Five vendors were 94% of FY2025 inventory purchases. Some implants come from single or sole sources, including Hammill Manufacturing and Bricon, per the S-1.

  Watch Any supply interruption, or new tariffs on materials, reported in later filings.

• Regulation

  Payment and coverage rules

  The S-1 lists coverage and reimbursement as risks, along with pricing pressure. Two-level lumbar coverage is about 45% of covered lives, and the $17,913 Medicare rate is from the company's internal analyses.

  Watch Yearly Medicare payment rates and insurer policies on two-level procedures.

• Regulation

  Product recalls

  Two voluntary FDA Class 2 recalls of mislabeled prodisc C SK units came in 2025 and 2026. One implanted patient had pain that resolved; no injury was identified in the second recall, per the S-1.

  Watch Whether the FDA terminates both recalls, as the company requested.

• Competition

  Larger competitors

  The S-1 names Medtronic and Globus Medical among direct competitors and says many rivals have significantly greater resources. Patent groups it describes expire between 2027 and 2030.

  Watch New rival TDR products and expiring patents.

• Other

  A short record of profit

  The S-1 says it may not maintain profitability after losses from 2017 until the six months to Jun 30, 2026. Accumulated deficit was $188.4 million, and that half-year's $10.2 million includes $3.9 million of other income.

  Watch Operating income next to net income in the next reported period.

• Size and price not yet set

  The S-1 leaves the price range, shares offered, money raised and ownership after the offering blank. It warns buyers will face immediate dilution, meaning less book value per share than they pay.

• Tax payments to existing owners

  The parent pays certain existing owners 85% of certain tax benefits. The company says "we expect that such payments will be substantial" (S-1, Oct 7, 2026). They can be accelerated or exceed actual benefits.

• Money goes partly to lenders

  Part of the proceeds repays debt, including loans from entities controlled by some equity holders and board observers. The company also has broad discretion over how it spends the rest.

• Holding company structure

  The parent's only asset will be units in Centinel Spine, LLC, so it depends on that company's distributions. The S-1 says interests of Continuing Equity Owners can conflict with those of Class A holders.

• Voting control

  The S-1 says principal stockholders and management will have significant control. Class A and Class B vote together, and Continuing Equity Owners hold all of Class B. Their percentages are blank.

• More shares can reach the market

  Lock-ups (what this means)Lock-upsA period after an IPO when insiders agree not to sell their shares. Learn more run 180 days and the lead underwriters can release early. Exchanges of LLC units and future sales are listed as risks, and convertible notes turn into shares at the IPO.

• Less disclosure and takeover limits

  As an emerging growth company it gives 2 audited years and may use reduced reporting. The S-1 also lists a classified board with 3-year terms and other anti-takeover terms.

What does Centinel Spine do?

Centinel Spine (Centinel Spine Holdco, Inc., West Chester, Pennsylvania) makes prodisc implants that replace worn spinal discs in the neck and lower back. All its revenue comes from prodisc: $132.2 million in FY2025 (year to Dec 31, 2025), per its S-1 dated Oct 7, 2026.

How does Centinel Spine make money? What is its business model?

Centinel Spine earns money selling implants that surgeons use in total disc replacement surgery. In FY2025 its revenue was $132.2 million and gross profit $106.0 million, per its S-1. Selling and marketing cost $67.5 million, up $18.1 million from FY2024, and $11.3 million of that rise was commissions.

Who are Centinel Spine's customers?

Centinel Spine's customers are hospitals and outpatient surgery centers, when a non-stocking distributor handles the sale, and stocking distributors abroad, per its S-1 dated Oct 7, 2026. No customer was above 10% of revenue in FY2024, FY2025 or the six-month periods shown.

How big is Centinel Spine?

Centinel Spine's revenue was $132.2 million in FY2025, up from $95.1 million in FY2024, per its S-1. It reached $85.2 million in the six months to Jun 30, 2026, up from $60.1 million a year earlier. It had 138 full-time employees at Jun 30, 2026.

Is Centinel Spine profitable?

Centinel Spine had a net loss of $4.3 million in FY2025 and net income of $10.2 million in the six months to Jun 30, 2026, per its S-1. That net income includes $3.9 million of other income, mainly warrant and derivative gains. Operating income was $13.0 million in those six months.

What is Centinel Spine's revenue by segment?

Centinel Spine reports one segment, per its S-1, so it has no segment split. By geography, FY2025 revenue was $110.5 million in the US and $21.7 million internationally. In the six months to Jun 30, 2026 it was $72.9 million and $12.4 million.

What is Centinel Spine's prodisc C?

Prodisc C is Centinel Spine's family of 4 implant systems for the neck (cervical): prodisc C, C Vivo, C SK and C Nova. In 2025 the two-level versions of C Vivo and C SK launched in the US, per its S-1 dated Oct 7, 2026. The FDA approved two-level C Nova on Sep 9, 2026.

What is Centinel Spine's prodisc L?

Prodisc L is Centinel Spine's 1 implant system for the lower back (lumbar), with Anatomic Endplates. Its two-level version launched in the US in 2020. The S-1 dated Oct 7, 2026 puts commercial lumbar coverage at about 95% of covered lives for one level and about 45% for two.

Who owns Centinel Spine before the IPO?

Centinel Spine's S-1 dated Oct 7, 2026 names AW Alpha Capital LLC, Oman Investment Authority, Viscogliosi Brothers, LLC and Viscogliosi Brothers Venture Partners VI, LLC as 5% holders. It leaves every percentage blank, so the size of each stake is not yet known.

What is the Centinel Spine IPO?

Centinel Spine filed a Form S-1 with the SEC on Oct 7, 2026 to list Class A shares on the NYSE under the proposed ticker CNTL. Only the company sells shares, so the money goes to it; the share count and price range are not yet in the filing.

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