Form SD ORTHOFIX INTERNATIONAL

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

 

FORM SD

 

 

Specialized Disclosure Report

 

 

Orthofix International N.V.

(Exact name of Registrant as specified in its charter)

 

 

 

 

 

 

Doug Rice

Orthofix International N.V.

3451 Plano Parkway

Lewisville, TX 75056

(214) 937-2000

 

(Name, address and telephone number of agent for service)

 

Check the appropriate box below to indicate the rule pursuant to which this form is being filed, and provide the period to which the information in this form applies:

x Rule 13p-1 under the Securities Act (17 CFR 240.13p-1) for the reporting period from January 1, 2015 to December 31, 2015

 

 

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Section 1 – Conflict Minerals Disclosure

Item 1.01 Conflict Minerals Disclosure and Report

This Form SD of Orthofix International N.V. (the “Company”) is filed pursuant to Rule 13p-1 promulgated under the Securities Exchange Act of 1934, as amended, for the reporting period January 1, 2015 to December 31, 2015.

A copy of the Company’s Conflict Minerals Report is provided as Exhibit 1.01 to this Form SD, and is publically available under the “Investors” heading of the Company’s website, www.orthofix.com.

Item 1.02 Exhibit

A copy of the Company’s 2015 Conflict Minerals Report is filed as Exhibit 1.01 attached to this Form SD.

Section 2 – Exhibits

Item 2.01 Exhibits

The following exhibit is filed as part of this report.

 

 

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

 

 

 

Date: May 27, 2016

 

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EXHIBIT INDEX

 

 

 

Exhibit 1.01

Orthofix International N.V.

Conflict Minerals Report

For The Reporting period from January 1, 2015 to December 31, 2015

This Conflict Minerals Report (“Report”) of Orthofix International N.V. (“Orthofix”) has been prepared for the reporting period from January 1, 2015 to December 31, 2015, pursuant to Rule 13p-1 (the “Rule”) promulgated under the Securities Exchange Act of 1934, as amended and is being filed on Form SD. The Rule was adopted by the Securities and Exchange Commission (“SEC”) to implement reporting and disclosure requirements applicable to companies that manufacture or contract to manufacture products containing certain conflict minerals as defined under the Rule.

Conflict minerals under the Rule are defined as cassiterite, columbite-tantalite, wolframite and gold, including their derivatives, which are limited to tin, tantalum and tungsten (“Conflict Minerals” or “3TG”). The SEC reporting and disclosure requirements apply to all registrants regardless of geographic origin and whether or not they fund armed conflict. As described below, Orthofix manufactures, or contracts to manufacture, products for which 3TG are necessary to the functionality or production of those products.

The Rule states that if a company knows that any of the necessary 3TG in its supply chain originated in covered countries and are not from recycled or scrap sources, or if it has reason to believe that its necessary 3TG may have originated from the covered countries and has reason to believe that they are not from recycled or scrap sources, then the company must exercise due diligence on the 3TG minerals source and chain of custody. For the purposes of this report, covered countries, as defined in the Rule include the Democratic Republic of the Congo, the Republic of the Congo, the Central African Republic, South Sudan, Uganda, Rwanda, Burundi, Tanzania, Zambia and Angola.

Company Overview

This report has been prepared by management of Orthofix (herein referred to as “the Company,” “we,” “us,” or “our”). We are a diversified, global medical device company focused on improving patients’ lives by providing superior reconstructive and regenerative orthopedic and spine solutions to physicians worldwide. Headquartered in Lewisville, Texas, the Company has four strategic business units that include BioStim, Biologics, Extremity Fixation and Spine Fixation. Orthofix products are widely distributed via the Company’s sales representatives, distributors and its subsidiaries. In addition, Orthofix is collaborating on research and development activities with leading clinical organizations such as the Musculoskeletal Transplant Foundation and the Texas Scottish Rite Hospital for Children.

While our principal products sold through our Biologics Strategic Business Unit do not contain 3TG materials, products that could contain 3TG materials are sold through our other strategic business units:    

Supply chain

We rely on suppliers for various components and parts that could contain 3TG that are utilized in the manufacturing of our products. As a company in the medical device industry we do not make purchases of raw ore or unrefined 3TG nor do we make purchases from the covered countries. As such, our position in the supply chain is several steps downstream from mines and smelters. Therefore, we must rely on our direct suppliers to provide information on the origin of the 3TG contained in the components and parts supplied to us – including sources of 3TG that are supplied to them from their suppliers. Further, many of our suppliers are not registrants with the SEC and therefore are not subject to the reporting requirements of the Rule. Due to complexity of our products and position in their respective supply chains, the Company believes it will take additional time for many of its suppliers to verify the origin of the necessary 3TG in our products.  

In determining which suppliers to survey to determine the source and chain of custody of 3TG in our supply chain, the Company’s supply chain, engineering and operation personnel used Company product control data to identify parts, materials and components which it reasonably expects may contain 3TG minerals.  To collect the data, the Company sent to suppliers identified as possibly providing materials containing 3TG a cover letter explaining the Company’s obligations under the Rule and the Conflict-Free

 

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Sourcing Initiative’s Conflict Minerals Reporting Template (the “CMRT”).  We collect the CMRT responses as they are returned, and perform an analysis and review of information received from identified suppliers for completeness and consistency.  Where appropriate, we ask suppliers for any clarification in determining the country of origin of 3TG being supplied to the Company. We reviewed our purchases from identified suppliers that did not respond to our requests to provide a completed CMRT and removed some suppliers from our approved supplier listing for failure to respond to our requests for information.

On the basis of the responses to our reasonable country of origin inquiry, Orthofix has reason to believe it is possible that some 3TG necessary to the functionality or production of our products may have originated from the covered countries. Accordingly, the Company conducted further due diligence on the source and chain of custody of the 3TG contained in products provided by our suppliers.

The Company’s due diligence program has been designed to conform, in all material respects, with the Organization for Economic Cooperation and Development’s Due Diligence Guidance for Responsible Supply Chain of Minerals from Conflict-Affected and High Risk Areas: Second Edition (2013), (the “OECD Guidance”). Our due diligence included the following five steps of the OECD Guidance.  

 

3.Due Diligence Results

Of 132 suppliers the Company determined provide materials that may contain 3TG to the Company, 113 suppliers responded, of which 108 suppliers indicated that they did not knowingly source 3TG from the covered countries.  The remaining identified suppliers either were still in the process of performing due diligence of their own supply chains or did not respond to repeated requests for information on the source of 3TG in the materials provided to us.  For suppliers found still to be in progress of performing and implementing due diligence procedures from their own suppliers, these suppliers are expected to develop, implement and document plans to remedy any potential instances of non-compliance in a timely manner. If the non-compliance cannot be resolved, we may consider termination of our relationship with the supplier.

We must rely on responses from our identified suppliers to provide us with information about the source of 3TG contained in the components supplied to us. Our direct suppliers are similarly reliant upon information provided from their suppliers. Some suppliers responded that they were unable to identify the smelters and refiners used to process 3TG or the country of origin of the 3TG in their supply chain at this time.  Other suppliers provided information on all smelters and refiners and country of origin of 3TG at the company level which does not provide us with the necessary information to tie the smelter or refiner or country of origin information to the specific products supplied to Orthofix.  Accordingly, as of this reporting period, the Company does not know all the facilities used to process 3TG or the country of origin of all the 3TG used to produce our manufactured products.

 

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4.Steps To Be Taken to Mitigate Risk 

We intend to continue to improve our due diligence measures during the next reporting period.  The steps we will continue to pursue include:

 

Cautionary Statement about Forward-Looking Statements

This report contains “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934. Forward-looking statements are those that address activities, events or developments that we or our management intends, expects, projects, believes or anticipates will or may occur in the future. They are based on management’s assumptions and assessments in the light of past experience and trends, current economic and industry conditions, expected future developments and other relevant factors. They are not guarantees of future performance, and actual results, developments and business decisions may differ from those envisaged by our forward-looking statements. Our forward-looking statements are also subject to risks and uncertainties, which can affect our performance in both the near-and long-term. These forward-looking statements should be considered in the light of the information included in this report and our other filings with the SEC, including, without limitation, the Risk Factors, as well as the description of trends and other factors in Management’s Discussion and Analysis of Financial Condition and Results of Operations, set forth in our Form 10-K for the year ended December 31, 2015 and other filings with the SEC.

 

 

 

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