AO Foundation Annual Report 2017 by AO Foundation

ANNUAL REPORT 2017 A global network of surgeons

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Table of contents Editorial 2

Letter from the President and the CEO and Vice-Chairman

Executive Summary 4

AO Foundation highlights of 2017

Corporate Social Responsibility 6

Extending the AO’s Corporate Social Responsibility activities

Innovation 8

Expanding the AO’s innovation framework

Operational Excellence 10

Embedding operational excellence

AO Statistics 12

From carbon to people

AO Clinical Divisions 16 18 20 24

AOVET—a new economic model AOCMF—excellence in facial surgery across the specialties AOSpine—global thought leader in education and research AOTrauma—knowledge leadership through excellence in education

AO Initiatives 30 31

AONeuro—transitioning to Global Neuro AORecon—defining new standards

AO Institutes 32 35 38 40

AO Research Institute Davos (ARI) AOTK System AO Clinical Investigation and Documentation (AOCID) AO Education Institute (AOEI)

Governance Finance Governance Governing bodies of the AO Foundation Addresses

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42 46 48 50

Annual Repoart 2017 ┃ Editorial

Letter from the President and the CEO and Vice-Chairman Dear colleagues and friends, We have successfully concluded another busy year at the AO Foundation. There have been many achievements and challenges and we have made significant progress on many of our initiatives. The launch of the AO Development Incubator, our latest innovation initiative–supporting inventors to build and execute project plans towards a proof of concept–is another string to our bow in driving innovation. Adding to our portfolio of innovation initiatives, AO Invest is a new investment fund for start-ups run by a group of medical and business experts. Investments are made in startups developing innovative technology providing new solutions for orthopedic and trauma patients and surgeons. We believe that leveraging these two new initiatives alongside our existing dedicated innovation initiatives, the AOTK system and AO Strategy Fund, puts us in a strong position for the future. At the Trustees Meeting in Miami (US) we successfully concluded the Trustees Meeting Review creating a financially sustainable future without jeopardizing its main objectives. With this decision the regional governance adjustments in the AO and the best practice adjustments regarding ethics, compliance, and transparency have been fulfilled. After a detailed assessment, it was agreed that within the context of the mission statement review at the end of 2017 AONeuro will transition out of the AO and create an independent organization focused on neuro care: Global Neuro. Starting as an initiative to expand activities into the area of cranial neurosurgery, AONeuro grew at the AO into a fully established educational platform. A cross-departmental team of AO specialists developed the Global Education Process to standardize the planning, organization, and monitoring of AO educational events worldwide. Its purpose is to align the processes involved in organizing educational events across the AO’s clinical divisions, boosting efficiency, and effectiveness. Each year we deepen our Corporate Social Responsibility (CSR) commitments and in 2017 we created a donation platform whereby our faculty and officers can forego all or parts of their per diems and/or expense reimbursements for their AO activities and allocate it to CSR. The response has been extremely encouraging. Achieving these milestones would not have been possible without the ongoing commitment and hard work of the AO Trustees, officers, faculty, and staff. We thank them for their highly valued expertise and skills. In addition, we thank our industrial partner for its continued support in achieving our mission of improving patient care. Finally, in 2018, we look forward to celebrating the AO’s 60-year anniversary of transforming surgery and saving lives. Sincerely,

Nikolaus Renner President of the AO Foundation

Rolf Jeker CEO and Vice-Chairman

Annual Report 2017 â&#x201D;&#x192; Executive Summary

AO Foundation highlights of 2017

Annual Report 2017 ┃ Corporate Social Responsibility

Extending the AO’s Corporate Social Responsibility activities The AO Foundation in 2017 continued to build on its Corporate Social Responsibility (CSR) initiative with measures ensuring that the AO operates all aspects of its daily business in a manner that takes into consideration its impact on society, the environment, and its own people. SOCIETY AO Alliance (AOA) The AO’s most significant annual contribution is to the AOA, a developmental non-profit organization dedicated to improving fracture care in low-and middle-income countries. The AOA diversified into policy advice in Myanmar, delivering valuable advocacy, awareness and policy advice, as well as courses. The AOA also augmented its country initiative program for Ethiopia, and its Ghana country initiative got underway. Additionally, the organization educated 70 physicians on pediatric fracture care in Ghana and Myanmar and made significant Faculty Education Program (FEP) investments in French- and English-speaking Africa, and Asia, where more than 60 AOA faculty members were trained to become better educators. In parallel, the AOA completed phase two of the rollout of the Play Safe with Sisimpur project, providing training about prevention of pediatric injuries for 1,000 child mentors, 1,200 adult mentors, 160 government school teachers and 100 first responders in Bangladesh. Direct CSR support To make it easier to directly support the foundation’s CSR activities, the AO made it possible for all faculty and officers to renounce their per diems and/or expense reimbursements–partly or in full. The proceeds amounted to CHF 47,000. These renunciations were allocated to the AOA (50%); the carbon offsetting projects in Malawi (25%); and the local charity ARGO (25%). ENVIRONMENT Since 2013, the AO has voluntarily offset a portion of its carbon footprint to make its events carbon neutral. In addition to offsetting the AO Trustees and AOTK System meetings through financial support for infrastructure projects in rural Kenya, in 2017 the AO began offsetting its carbon emissions by supporting activities in Malawi, including the rehabilitation of community boreholes and corresponding maintenance training, and improvement of health clinic infrastructures to improve the patient care for 50,000 patients and their relatives in rural Malawi. Thanks to the program, these people now have access to clean drinking water and better health care in their local clinics. PEOPLE Through its Human Resources (HR) activities, the AO advanced its commitment to providing a fair workplace–to both existing and future employees–such as no-gender-bias salaries. To better gauge employees’ opinions of the AO as an employer, HR conducted a 43-question branding survey, which yielded a 77% response rate. The AO received the highest ratings on questions gauging respondents’ commitment to the AO’s mission, their sense of integration into their respective work teams, and professional relationships with their supervisors. The survey’s objective was to identify employees’ perceptions of the AO; analysis of the survey results got underway in the first quarter of 2018 and employees’ feedback will be integrated into the AO’s employer branding to support its recruitment strategy. 6

Annual Report 2017 ┃ Innovation

Expanding the AO’s innovation framework Backed by a 60-year innovation legacy built on the insights and bold innovations of experienced surgeons committed to promoting excellence in the treatment of trauma and musculoskeletal disorders, the AO Foundation expanded its legendary innovation engine with the launch of AO Development Incubator (AODI) activities. Established in 2016, the AODI represents a springboard for innovations outside of the domain of the AO’s industrial partners and serves to unleash a world of innovation potential for improving patient outcomes. The AODI funds selected inventors to build and execute their projects toward a proof of concept and valorization, with the AO and the inventor sharing project development and generated value. Managed by a board representing both the medical and industrial worlds, the AODI in 2017 conducted two calls for proposals generating 124 applications from around the world. Proposed innovations ranged from implants to 3-D printing projects and virtual simulations. Two proposals from the first call were approved in 2017 and the selection process of the second call is expected to be finalized in the second quarter of 2018. Building on an existing innovation legacy The AODI builds on and extends the AO’s existing innovation framework, which began with the 1961 establishment of the AO Technical Commission (AOTK). The AOTK, an organization of medical-technical committees, is responsible for development and clinical testing of devices–as well as the educational concepts around them–developed by the AO in collaboration with its industrial partners. The AO’s innovation infrastructure was further expanded in 2013 with the launch of the AO Strategy Fund (AOSF), which supports a wide range of projects submitted by AO employees and members. These projects include new services and technologies that enhance the AO’s visibility and reach, foster cooperation across clinical divisions, and boost operational effectiveness and efficiency. The AODI can serve as the next possible step toward proof of concept and valorization upon completion of AOSF projects. Another critical component in the AO innovation continuum is AO Invest, which invests in start-ups that advance patient care through innovative medical products and services applied in orthopedic and trauma surgery. The current portfolio includes two companies: Touch Surgery‘s interactive mobile surgical simulator guides the user step-by-step through every part of an operation and every decision made along the way, and Augmedics‘ augmented reality head-mounted display allows surgeons to “see” inside a patient’s anatomy, through skin and tissue, resulting in easier, faster and safer surgeries. AO Invest continues to seek out startups that deliver truly disruptive innovation. Activities ahead in 2018 The AODI’s planning includes two calls for proposals in 2018: March and September. Additionally, development of an AO innovation platform is in the works to ensure alignment of AOTK, AOSF, AODI, and AO Invest work to exploit of their synergies, spurring more innovation to further advance patient care.

Annual Report 2017 ┃ Operational Excellence

Embedding operational excellence True to its vision of excellence in the surgical management of trauma and disorders of the musculoskeletal system, the AO began an ambitious Operational Excellence (OE) program aimed at aligning and streamlining processes throughout the organization. A baseline structure was established to guarantee sustainable OE, and processes were identified and defined. In the first phase of the AO’s OE activities, the team tackled the Global Education Process (GEP), examining all the processes involved in education across the organization’s four clinical divisions and two initiatives. Due to the decentralization of the clinical divisions and the complexity of the organization, operations were carried out differently. The OE team focused on aligning processes by identifying best practices and integrating them into the GEP. By eliminating non-value added activities, these processes ensure that employees can work efficiently, creating value, and contributing to the AO’s vision of excellence. Process mapping That’s why program leaders and those involved in the GEP set about aligning and mapping GEP processes. OE also took a close look at the finance flows related to the GEP: how educational events are funded and how income is generated. With redefined and more transparent finance flows rolled out, the improved GEP will be implemented in 2018, including training, asset development, and reporting and monitoring. Every idea counts Another OE project was evaluating and implementing a process management tool that makes it possible for every employee to take ownership of the topic of OE and make suggestions for improving AO processes. Every idea is considered by the OE team and the contributor receives a feedback, regardless of whether the idea is implemented. On the information technology (IT) side, a new, common membership management platform was introduced to streamline processes related to membership and community management across the clinical divisions. Additionally, a centralized faculty database was introduced for all clinical divisions. Ultimately, alignment and streamlining of AO processes is expected to result in greater efficiency throughout the organization, empowering every employee to use his or her competence to add value and make a greater contribution to advancing patient care.

Annual Report 2017 ┃ AO Statistics

2007 833,096

2017 497,193

Electricity consumption in kilowatt hours

2007 37,699 liters of oil 2017 24,216 liters of oil Energy efficiency at the AO Center

Heating oil use

There has been a 36% reduction in heating oil use since the energy saving initiatives began a decade ago.

There has been a 40% reduction in electricity consumption in the AO Center in Davos (CH) since the energy saving initiatives began a decade ago. The AO Center in Davos (CH) recycled

Place of work

168 kilograms of PET

Davos 64.3% Dübendorf 27.2%

Years of service

20 7.8% 10–20 20.1% 5–10 18.8% 3–5 14.1% 1–3 24.8% <1 14.4% >

91.5%

Hong Kong

4.2%

US 2.0% Colombia 1.1% Brazil 1.1%

4.2%

Number of paying members per clinical division

9,149 AOTrauma 6,501 AOSpine 3,252 AOCMF 1,172 AOVET 20,074 Total

Number of registered users per clinical division AOTrauma

100,207

37,908 AOCMF 25,296 AOSpine AOVET Total

Talent management Staff statistics (in %): Education PhD 18 Master’s degree 27 Bachelor’s degree 22 Further education 11 Apprenticeship 22 12

Gender Female 54.8 Male 45.2

Nationalities of staff in Switzerland Where they come from (in %): Austria Canada Finland France Germany Ireland Italy

0.9 0.9 0.9 0.9 16.7 0.9 4.0

Poland 1.2 Netherlands 2.2 Spain 2.5 Switzerland 57.3 United Kingdom 4.3 United States 1.2 Others 6.1

7,286

170,670

From carbon to people Malawi: clean water through restored boreholes, 4,764 tons of carbon emissions were offset Kenya: efficient cookstoves and clean water, 1,961 tons of carbon emissions were offset

Trees saved

People impacted

Trees saved

People impacted

5,533

1,320

6,212

2,000

Climate protection and sustainable development The AO Foundation offset 6,725 tons of carbon emissions (tCO2e) during 2017

Educational events and participants

Fellowships per clinical division

by clinical division

AOTrauma

296

AOSpine

201

AOCMF

AOTrauma

395 31,800

206 11,382

AOSpine

AOCMF

122 6,323

46 2,082

AOVET

61 2,597

Operating Room Personnel Educational events 830 Participants 54,184 Total

AOVET Total

Educational events and participants by region

192 15,350

Asia Pacific

566

285 13,259

Europe and Southern Africa

165 11,899

Latin America

76 5,388

North America

77 3,400

Middle East and Northern Africa

4,888

International 13

AO Clinical Divisions, AO Initiatives, and AO Institutes

Annual Report 2017 ┃ AO Clinical Divisions

AOVET Course–Recognize and Manage Complications in Small Animal Orthopedics, AO Davos Courses, December 2017

FUTURE OUTLOOK 19 elections with the AOVET governance structure Establish long-term agreements with industrial partners and sponsors Establishment of Community Development Commission

AOVET—a new economic model At the AOVET International Board retreat, the future pathway of AOVET until 2020 was outlined. To become the preeminent educator for orthopedics in animals, AOVET will implement a new strategy for the delivery of its educational courses. This strategy allows for the collaboration with different and multiple educational sponsors and partners. The results from the first courses in this new manner held in 2017 were positive, with profitable margins and satisfied participants in new locations. Additionally, to increase the awareness and reach of AOVET and its mission, Community Development revamped the AOVET brand with an innovative and fresh look and expanded its online presence. The year closed with the reelection of Carl Kirker-Head, International Board Chair, who is determined to make the complex reorganization of AOVET a success to ensure AOVET’s longevity. Education AOVET rolled out new curricula for the Small Animal Principles and Advanced courses with enhanced quality. These proved to be popular among course attendees. Moreover, in line with the new business strategy, AOVET launched its first Category 3 courses with various industrial partners and sponsors in Asia Pacific, Europe, and Latin America, all part of a global expansion process. Results were positive, with a net profit and many things learned. In total, AOVET successfully delivered 43 global educational activities (19 Category 1; 9 Category 2; 11 Category 3 courses; 2 webinars; and 2 seminars) to 2,126 participants with the aid of 215 faculty. AOVET also successfully demonstrated its methods-based courses in a commercially oriented environment. 16

International Practical Course Orthopedics, AOVET Masterclass on Advanced Corrective Osteotomies for Front Limb Deformities, Cremona (IT), 2017

AOVET Courseâ&#x20AC;&#x201C;Master in Equine Arthrodesis Technique and Fracture Fixation, AO Davos Courses, December 2017

Community development The AOVET community grew 26% to approximately 1,000 members by the end of 2017, the largest increase since membership began. The creation of a unique identity through a distinctive and striking brand and the launch into social media with a dedicated AOVET Facebook page proved impactful toward reaching a larger audience. Additionally, one equine and two new small animal modules in AO Surgery Reference VET were published. As part of a cross divisional project, the AO Community Portal was launched to give our community a user-friendly platform. Research and development The AO Foundation is committed to the pursuit of best practices in the context of animal welfare. With a process largely driven by the AOVET Research and Development (R&D) Commission, it became a Member Organization of the Association for the Assessment and Accreditation of Laboratory Animal Care International (AAALAC) which sets best-in-class standards. The AOVET R&D Commission has been mandated to review and approve the respective education and research activities involving animal models so that they comply with the AAALAC requirements. Furthermore, in a new strategy, R&D is redirecting resources toward building research education opportunities within and outside of the foundation.

Annual Report 2017 ┃ AO Clinical Divisions

AOCMF Course–Management of Facial Trauma, practical exercise, cases, zygomatic, orbit, zygoma and orbit and Le Fort, Tallinn (EE), September 2017

AOCMF—excellence in facial surgery across the specialties This year, a record number of courses and webinars were offered in more countries than previous years. AOCMF’s online presence improved significantly with a redesigned, responsive website and increased interest on its social media platforms. Significant progress was also made on research and development (R&D) projects in 2017, capping off a successful year. Education In 2017, AOCMF successfully conducted 122 educational events (+3%) and trained 6,446 participants from around the globe. The focus on training in countries with limited access to education was emphasized by the continuous support of the AO Alliance and the organization of numerous courses in lower income countries. A new competency-based curriculum, the Management of Facial Trauma course, was launched in 25 countries worldwide and attracted over 1,500 participants. During the Davos Courses, a new format emphasizing hands-on training with the latest insights on soft tissue management was introduced resulting in notable success. The newly built AOCMF Global Education Taskforce was approved by the AOCMF International Board, assuming the role of an advisory body on education matters to all boards and commissions. Additionally there has been strong interest in AOCMF’s fellowship program, with 62 participants (+13%) who were trained in 26 host clinics worldwide. 18

AOCMF Courseâ&#x20AC;&#x201C;Management of Facial Trauma, practical exercise, load sharing, mandibular fractures, Tallinn, (EE), September 2017

FUTURE OUTLOOK Publication of the AOCMF Advanced Manual Launch of new membership program Launch of a new course format on 3-D planning and printing

Community development The new, responsive AOCMF website, developed in close collaboration with surgeons, went live in time for the Davos Courses. The new website caters to the needs of medical experts around the world by promoting excellence in facial trauma and reconstruction. Along with new features comes a fresh user experience with a focus on videos and stories. Interaction with surgeons improved through integrated digital channels. Webinars were attended by a record number of participants and traffic on our social networking platforms continually increased. Encouraged by the social media presence and targeted member communication, the AOCMF global network grew to an all time record of 3,250 (+8%). Research and development In mid-2017, Eppo Wolvius succeeded Risto Kontio who had served six exciting and successful years as Chair of the Research and Development Commission. A new, highly interactive research education format was tested at the R&D symposium in Helsinki (FI), which gave an overview of the scientific literature and controversial case discussions amongst world-leading craniomaxillofacial surgeons and participants. This included analyzing and contemplating the clinical challenges from a variety of perspectives. Considerable progress was achieved within the three strategic R&D thrusts: bone defects/bone healing, temporo-mandibular joint, and antiresorptive drug-related osteonecrosis of the jaw (ARONJ). Numerous interim and final reports were received, and for the ARONJ projects, publications were submitted, and the feasibility studies were completed.

Annual Report 2017 ┃ AO Clinical Divisions

AOSpine, Surgeon’s Cockpit, training of MIS Procedures under real spine conditions basic course, hands-on training on microscope, AO Davos Courses, December 2017

FUTURE OUTLOOK Knowledge translation from research to education Roll out hospital-based course program Strengthen online presence

AOSpine—global thought leader in education and research Throughout 2017, AOSpine strengthened its academic position in the following key areas. In education, over 11,000 professionals participated in 206 educational events. In research, AOSpine reinforced its thought leadership by publishing over 92 peer-reviewed scientific papers and presentations. The Global Spine Congress continues to grow; while the Global Spine Journal continues to increase its importance amongst the spine journals. The AOSpine community surpassed 6,500 members. Education To support the commitment to understanding the needs of spine surgeons, an assessment conducted in 2017 received 3,000 responses confirming that minimally invasive surgery is a significant educational requirement, and innovation in this area is a top priority. A new concept introduced in 2017 was a hospital-based simulation course, bringing education to the surgeons’ daily environments, with a focus on spinal decompression and fusion. Delivered in a local setting using a simulator and enhanced by a high faculty-to-participant ratio, it offers comprehensive online learning materials, and a live online tutorial.

AOSpine, Surgeon’s Cockpit, training of MIS Procedures under real spine conditions basic course, hands-on training on microscope, AO Davos Courses, December 2017

Research A new, three pillar global research strategy–clinical research, preclinical research, and research training–continues to advance spine research. The pathology-specific Knowledge Forums produced 53 peer-reviewed publications, 39 presentations, and key clinical outcomes and tools. These include treatment guidelines for degenerative cervical myelopathy and acute spinal cord injury patients; an international treatment consensus for adult spinal deformity patients; a spine oncology-specific patient-reported outcome; an injury classification system for the upper cervical spine; and a compendium of current controversies in spine trauma. A preclinical study on immune status and postoperative spine infection was initiated and a two-year mentorship program fostering local research in all AO regions was completed. Community development Activities in this field are focused on developing the membership program by promoting education, research, and networking initiatives reaching ever-higher number of members. AOSpine’s newsletter, which won the award for “best European Association e-newsletter 2017,” became one of the most popular membership privileges. Further communication initiatives included the Global Spine Congress and the Global Spine Journal. Additionally, steps were taken to streamline online communication activities, ensuring the most up-todate communication strategies across all channels.

Annual Report 2017 ┃ AO Clinical Divisions

AOSpine Asia Pacific Regional Course–Advanced Regional Anatomical Specimen, Chulalongkorn University, Bangkok (TH), August 2017 AOSpine–Advanced Level Live Tissue Training Course, complications management, Acibadem University, Istanbul (TR), April 2017

AOSpine Europe and Southern Africa (AOSEU) AOSEU improved the governance structure based on the TEAM approach, simplified standards for elections, and the country representatives were introduced for countries with under 25 members. The AO’s Process Management Project ensured processes were reviewed and a more transparent fellowship process was introduced. To position AOSEU as a scientific society, the cooperation with nine regional societies and country societies was intensified. To support educational offerings, educational advisors held keynote lectures during events. In France and Russia, AOSEU launched webinars in the local languages with remote faculty. Enrollment in the SciPoem Study continues to work toward reaching 300 patients before it concludes in December 2018. AOSpine Middle East and Northern Africa (AOSMENA) AOSME expanded to all Northern African countries above the equator, with events in these areas beginning in 2018. Partnering together, AOSEU and AOSME launched a cross-regional Advanced Level Live Tissue Training Course–Complications Management, in Istanbul (TR). In Cario (EG), the first Scoliosis Week took place with resounding success, fostering a closer collaboration amongst spine societies in Egypt, Lebanon, Iraq, and the United Arab Emirates. AOSpine Asia Pacific (AOSAP) AOSAP conducted a total of 51 courses with a record number of participants (3,477) and faculty (620). One of the highlights was the top-rated, sold-out regional course. AOSAP has a strong alliance with various spine societies in the region. Valuable collaborations continue with CASSC, CAOS, and COA of China; ASSN of Nepal; MISSCOT of Thailand; GOA and ICS of India; JSSR of Japan; KSNS and KSSS of Korea. Member numbers reached 2,345, with Korea and India having the highest membership growth at 35% and 20% respectively; while Japan reached a historic achievement with over 600 members. 22

Jeffrey Wang presents at the Global Spine Congress, Milan (IT), 2017

15th Annual Fellows Forum, AOSpine North America, Banff (CA), March 2017

AOSpine North America (AOSNA) AOSNA delivered eleven courses and six webinars reaching 667 surgeons. Nearly 40% of the courses were held for the first time, based on clinician needs, and included collaborations with other societies and regions. The newest offering, Practice Essentials, a course focused on non-clinical competencies, proved to be one of the highlights of 2017. Research efforts continued to push the frontiers of knowledge-based spine care showcased during presentations at major spine meetings and within the clinical guidelines on traumatic spinal cord injury and degenerative cervical myelopathy. AOSNA hosted its fourth annual reception at the North American Spine Society meeting. Fellowship engagement remains a critical initiative of AOSNA with 35 fellowship sites and 91 fellows. AOSpine Latin America (AOSLA) AOSLA delivered 65 educational activities to 4,260 participants this year. The second regional courses were held in Mexico City (MX) with 250 surgeons attending the event. A new virtual library exclusive for members provides access to information on different pathologies, clinical cases, and webinars. Study groups showed progress in the number of publications and research projects conducted within the year. Global Spine Congress (GSC) The annual GSC continues to be the premier international event for the spine surgeon community, with 1,600 participants from over 80 different countries attending the 2017 event in Milan (IT). A record number of abstracts were submitted, and two industry-sponsored cadaver lab operations were simultaneously staged. Offering parallel sessions from key opinion leaders, GSC 2017 covered more than 25 topics, showcasing the very latest research, innovative best practices, and cutting-edge technologies used in spine surgery to date. 23

Annual Report 2017 ┃ AO Clinical Divisions

AOTrauma Masters Course–Current Concepts–Soft Tissue and Polytrauma, Anatomical Specimen Laboratory, AO Davos Courses, December 2017

AOTrauma—knowledge leadership through excellence in education In 2017, AOTrauma focused on the implementation of its strategy defined in 2016. Under the leadership of Kodi Kojima, who succeeded Jack Wilber as Chair of the AOTrauma International Board, AOTrauma emphasized its five key goals: foster the position as the knowledge leader in musculoskeletal trauma care; recruit, develop and retain the best faculty worldwide; enrich the AOTrauma community of health care professionals; increase the awareness and recognition of AOTrauma; and ensure a sustainable organizational framework. AOTrauma had great success with its global educational activities. A total of 31,800 health care professionals participated in 395 courses and 14 global webinars and webcasts. AOTrauma Community Development successfully implemented a new member portal and funded 38 national projects to strengthen local communities. Research continues to focus on the Clinical Priority Program Bone Infection for another five years and a new CPP on Clinical Outcome Measurements of Fracture Treatment was launched. The finalization of the AO/OTA Fracture and Dislocation Classification Compendium revision was a highlight of 2017 as it addressed the many suggestions to improve the application of the system and adds recently published and validated classifications.

AOTrauma Course–Advanced Principles of Fracture Management for Swiss Surgeons, practical exercise, distal radius, two column distal radius, AO Davos Courses, December 2017

FUTURE OUTLOOK Pursue knowledge leadership in our field Enrich the value proposition of being an AOTrauma faculty or member Focus on operational excellence

Education: providing continuously state-of-the-art quality content in education The newly launched Community of Fellows gives AOTrauma Fellows (a record of 266 new fellowships were awarded in 2017) a place to share their experiences and connect with others worldwide. Content development is one of AOTrauma’s highest priorities; the third edition of the best-selling textbook, AO Principles of Fracture Management, edited by RG Buckley, CG Moran, and T Apivatthakakul, was published along with the foot and ankle, and pediatrics curricula. AOTrauma continued its leading role in e-learning, with 14 global webinars and webcasts by world-leading faculty; a polytrauma module was launched in the AOTrauma STaRT eLearning environment targeting residents; and new iPad simulation apps are being developed to complement the Basic Principles Course. At the AO Davos Courses 2017, the new periprosthetic fracture management curriculum, codeveloped with AORecon, was presented. The AOTrauma courses at the 2017 AO Davos Courses received the highest ratings from participants since AO started collecting evaluation data. Community development: paving the way to better serve the global community Launching the AO Community Portal was a major step in modernizing the membership information technology infrastructure to improve service quality and become more efficient. Membership decreased slightly by 2.5% to 9,207, mainly due to fewer renewals in Europe, Southern Africa, and North America, although by year-end, AOTrauma had more than 100,000 registered users. Social media continued to be an important channel for interacting with the global community and AOTrauma’s Facebook accountlogged over 15,000 followers (+25% increase). The Community Development Commission funded 38 national projects and the Community of Fellows initiative launched its website and ran its first regional events. Samir Mehta from Pennsylvania (US) became Chairperson-elect and will take over from Mike Miranda in July 2018. 25

Annual Report 2017 â&#x201D;&#x192; AO Clinical Divisions

AOTrauma Masters Courseâ&#x20AC;&#x201C;Complications, correction of knee flexion deformity using circular fixator, Dubai (AE), October 2017

Research: AOTrauma established a new Clinical Priority Program (CPP) Measurement and impacts on outcome of orthopedic procedures are poorly understood and literature offers little help with decision making while methods to measure outcome are often confusing. The AOTrauma Research Commission (AOTRC) has acknowledged the challenge posed by Clinical Outcome Measurements of Fracture Treatment, defining it as the new CPP. This provides better understanding of clinical outcome measurement, solutions for pressing clinical problems, and a positive impact on patient care. The CPP consortium will establish guidelines for fracture treatment, aftercare, and rehabilitation. Bone infection research AOTrauma initiated the CPP in 2012, recognizing the clinical problem of bone infection as one of the most serious and distressing complications of orthopedic procedures. The incidence of infection is relatively low, but the costs and risks of the revision process are high. For traumatic procedures, the risk of infection increases dramatically. A research consortium led by Stephen Kates (US), together with international specialists and research partners, has produced promising results. This CPP is approved for another five years and, based on an independent review process, new research projects have been identified and the network enlarged with new research partners. Operating Room Personnel (ORP): increasing hospital-based activities Hospital-based education is becoming an important element of AOTrauma ORP education with a total of 38 Clinical Training Modules (CTMs) held in Asia Pacific, Europe, and the Middle East. An additional faculty training session focused on how to run, teach, and facilitate learning at local training events. As interest in CTMs grows in non-English speaking hospitals, translations into Dutch, Spanish, French, and Russian were initiated. The competency-based two-and three-day courses were continued in order to emphasize on practical skills and understanding of principles. 26

AOTrauma Courseâ&#x20AC;&#x201C;Advanced Principles of Fracture Management for ORP, Dubai (AE), October 2017

AOTEU Country General Assembly, Riga, (LV), June 2017

AOTrauma Asia Pacific (AOTAP): a continuously growing region AOTAP marked another productive year with 82 courses and seminars and 10,000 surgeons and ORPs educated. The regional combined courses in Chiang Mai (TH) successfully provided an excellent learning experience and networking opportunity to over 200 participants from 20 countries. AOTrauma seminars at eight national conferences received positive attendance and feedback. Faculty development remains a focus. Six FEPs, one CEP and three coaching sessions trained over 180 faculty. Twenty-four regional faculty fellows taught first time at a Basic Principles Course in the region. AOTrauma Europe and Southern Africa (AOTESA): improving quality and efficiency AOTESA organized 162 educational events for surgeons and 33 for ORP in 37 countries using the new finance flows model. The biennial Country General Assembly held in Riga (LV), welcomed officers from 39 countries. With 3,200 members, Europe remained the largest region. AOTESA trained 210 faculty with five national and four regional Faculty Education events (FEP); two Chairperson Education events (CEP); and two faculty retreats in Davos (CH) and Ljubljana (SI). The coaching program advanced with 40 Principles Courses and eleven newly trained coaches. Forty-seven fewllowships were granted in Europe and 27 in other regions, along with three research mini grants. Jonathan Monk (UK) took over from Peter Brink (NL) as Chair of the Education Committee and Pol Rommens (DE) took over from Michael Blauth (DE) as Research Chair.

Annual Report 2017 ┃ AO Clinical Divisions

AOTrauma Masters Course–Complications, correction of knee flexion deformity using circular fixator, Dubai (AE), October 2017

AOTrauma Fellowship reception, Davos (CH), December 2017

AOTrauma Latin America (AOTLA): increasing online education activities AOTLA held 51 courses and seminars with over 3,300 participants. Eight webinars with 1,500 participants gained regional and international attention. Twelve AO events (AO days or AO symposia) took place at national congresses. Video recordings of surgical approaches were emphasized and provided for use on regional websites. FEP, CEP and LEP courses contributed to the best faculty teaching and 17 courses were coached by regional faculty after receiving training in Davos (CH). One hundred regional faculty from all AO Clinical Divisions worked on education management at the 8th AOLAT Faculty Retreat. AOTLA offered 42 fellowships. Due to external circumstances in Venezuela, an AOTrauma course is planned in Colombia for Venezuelans in 2018. Juan Manuel Concha (CO) became AOTLA Board Chairperson in July, succeeding Mauricio Kfuri. AOTrauma Middle East and Northern Africa (AOTMENA): increased visibility AOTMENA organized 41 educational activities providing training to nearly 1,700 residents, fellows, and practicing surgeons. The Middle East Regional Courses in Dubai (UA), had 73 faculty in attendance and over 200 participants from 15 countries. During the event, two AOTrauma Masters-level courses were held. For the first time worldwide, the AOTMENA Community Development Committee organized a fellows’ night during the regional courses in Dubai. The event was a forum for all who have completed a fellowship. Basic Principles, Advanced Principles and ORP courses were successfully run in Tehran (IR) after years of absence due to sanctions from western countries. AOTMENA supported educational offerings with 50 trauma fellowships. Mohammed Wajid (PK) started as the new AOTMENA Board Chairperson.

AOTrauma Course–Pelvic and Acetabular Fracture Management, practical exercise, AO Davos Courses, December 2017

AOTrauma North America (AOTNA): A strong sense of community During the year, 24 live educational activities and 15 webinars reached 3,000 surgeons. The first three-day “Think Tank” Masters-level course involved 30 surgeons solving clinical problems. A curriculum work group was established to ensure educational events are designed according to evidence-based processes which can be evaluated. Nine Resident Research Awards were granted with two manuscripts published in the Journal of Orthopaedic Trauma; 17 fellow research grants were awarded; 27 long-term fellowship grants for a total of 55 fellows went to international sites, six fellows were sponsored to attend a Masters Course in Davos. The AOTNA members’ reception at the Orthopaedic Trauma Association (OTA) attracted over 300 participants. AOTNA represents 11% of the global AOTrauma membership with over 1,000 members.

Annual Report 2017 ┃ AO Initiatives

AONeuro Course–Neurotrauma, AO Davos Courses, December 2017

FUTURE OUTLOOK Expand the Global Neuro network Collaborate with international societies Offer competency-based education worldwide

AONeuro—transitioning to Global Neuro It was decided in 2017 to discontinue the AONeuro initiative and all efforts were put into establishing the independent Global Neuro Foundation to launch by December 2017. Valuable partnerships At the Davos Courses, AONeuro partnered with the Besta Simulation Institute to introduce new techniques. This collaboration allows surgeons to refine procedures through advances in simulation, benefiting patients by eliminating potential unnecessary risks. At the World Federation of Neuro Societies Congress in Istanbul (TR), AONeuro provided a luncheon symposium on Education and Training in Neurosurgery, A Call for Global Harmonization, attended by 200 participants. Education In 2017, the first AONeuro courses were held in Moscow (RU), Porto (PT), Instanbul (TR), and Hong Kong (HK). AONeuro held 16 educational events (courses, symposia, and seminars) globally, with 867 participants receiving high level training in Neurotrauma, Neuromonitoring (webinar), and one Skull Base Cadaver course. Transition Global Neuro retains the focus on educating health care professionals managing patients suffering from neurosurgical disorders. Continuing the commitment to improving patient outcomes, the organization will explore collaborations to advance treatment practices. Global Neuro intends to grow its network by working with international societies, industrial partners and offering competency-based education worldwide. 30

AORecon Skills Lab Development Workshop, Dübendorf (CH), September 2017

FUTURE OUTLOOK Increase reach of educational formats and content Develop, offer, and promote digital education delivery Foster AORecon faculty and offer expanded faculty support

AORecon—defining new standards In 2017, AORecon upgraded its educational content and expanded its global activities. Constructive feedback from participants and increased event requests from surgeons and societies have reaffirmed the need for AORecon’s educational offerings. Educational events AORecon offered eleven curriculum courses to 600 surgeons with specific training on different levels. In total, AORecon reached around 3,000 surgeons at 22 educational events, including eight major congresses and society meetings such as the COA, ASIA, AAOT, and DKOU. Content development AORecon updated its Principles Course and developed two new curriculum courses at advanced level: a course on complex hip and knee arthroplasty and, in collaboration with AOTrauma, a course on periprosthetic fracture management. Furthermore, AORecon advanced its content development in the fields of shoulder arthroplasty and joint preservation. Hands-on experience To introduce what the AO Foundation is otherwise so well-known for, AORecon created various practical exercises and developed the AORecon Skills Lab with multiple stations to let participants practice basic hip and knee replacement skills. Having taken another leap forward, AORecon is now at the threshold of becoming an inherent part of the AO Foundation, thus further fulfilling its vision and mission. 31

Annual Report 2017 â&#x201D;&#x192; AO Institutes

ARI is developing an antimicrobial strategy that eliminates extraneous surgery and prevents chronic infection

FUTURE OUTLOOK Nurture innovation while maintaining world-class research Develop and translate implant sensors and intelligent surgical tools Develop in vitro, ex vivo and in vivo models of disease for regenerative medicine

AO Research Institute Davos (ARI) Following the mission of the AO Foundation, the AO Research Institute Davos (ARI) is addressing important contemporary challenges emerging from everyday clinical practice. It develops state-of-the-art solutions with the potential for use in the operating theater and integration into current surgical processes, greatly improving the work of the orthopedic trauma surgeon within the next few years, and possibly revolutionizing it. Fracture-related infection ARI has been active in a range of activities focused on the clinical problem of fracture related infection (FRI). This has included the development of a new large animal model for treatment of chronic implant related infection, as well as a new initiative developing a definition of FRI that serves the need of the clinical community.

Antimicrobial strategy ARI is developing a novel antimicrobial strategy that eliminates extraneous surgery and prevents chronic infection. Our large animal model allows us to reexamine the treatment of FRIs in a manner closely resembling the human standard of care. Using this model, we have shown that local and systemic antibiotic therapy are both required to treat infection. Many infections are resistant to this kind of therapy. However, under ARI, an antibiotic loaded, degradable thermo-responsive hydrogel has been developed in response to the challenge. As a flowable, degradable material, the gel can be applied at the same time as a direct reimplantation, eliminating the need for a two-stage exchange. Using the large animal model, we could show that the gel not only prevents infection, but also allows a complete treatment of chronic infection with only one revision surgery required. In the next year, we hope to show that the gel is capable of treating MRSA in this challenging model.

3-D Discovery Printer in a biosafety cabinet from regenHU Ltd. in the ARI Davos (CH)

Confocal fluorescent image of viable human mesenchymal stem cells (green) in bioprinted hyaluronan bioink (red)

A new definition for fracture-related infection ARI has spearheaded an effort to improve the quality of clinical literature available on fracture complications, recognizing the absence of a commonly accepted definition of FRI. An expert group representing the AO Foundation, the European Bone and Joint Infection Society, and prominent orthopedic trauma centers, came to a consensus on this definition last year, paving the way for standardized clinical reports on the prevalence of FRI and improved reporting of clinical studies. Additive manufacturing Additive manufacturing (AM) is a manufacturing process through which 3-D solid objects are created by layers placed in succession until completely built. In the field of traumatology and orthopaedics AM permits high speed processing of implants and creation of tissue engineering constructs with shape, structure, and composition specifically designed for a patient in accordance with the surgeonâ&#x20AC;&#x2122;s surgical planning. However, there is still the need to develop truly implantable and safe biomaterials which can be processed together with cells by AM technologies. In a project supported by the AOCMF Research and Development Commission, ARI has developed a hyaluronan-based biomaterial tuning its biological, physical, and mechanical properties to be used in 3-D bioprinting AM. Primary cells can be embedded in the bioink formulation with high viability. The bioink is amenable to the 3-D bioprinting process and the construction of large 3-D constructs was achieved. Further studies are being conducted to develop innovative and robust bioinks for use in 3-D bioprinting AM for musculoskeletal repair and to assess the safety and efficacy of 3-D bioprinted constructs in preclinical studies.

Annual Report 2017 ┃ AO Institutes

Prof Robert Mauck receiving the Berton Rahn Research Prize, Davos (CH), June 2017

Tissue Engineering and Regenerative Medicine annual meeting successfully organized by AO Research Institute Davos Over 1,300 scientists including clinicians and industrial attendees from all over the world met in June 2017 in Davos, for the annual chapter meeting of the international society for “Tissue Engineering and Regenerative Medicine” (TERMIS-EU). The renowned congress was organized and implemented by ARI under the guidance of Prof R Geoff Richards and Prof Mauro Alini. Co-organizers were David Eglin, Sibylle Grad, Claudia Loebel, Martin Stoddart, and Sophie Verrier, as well as great support from ARI’s administration team. Using the theme “personalized therapies for regenerative medicine,” presentations were abundant with over 350 lectures and over 800 poster presentations. Four world-renowned speakers were also invited to report on their pioneering developments in plenary sessions. The latest research findings demonstrated the potential of stem cells, as well as natural and synthetic materials, for TERM. The number of presentations on patient-specific tissues from 3-D printers highlighted the increasing significance of this technology. TERMIS-EU prizes were awarded for outstanding achievements of emerging researchers and contributions to scientific literature. The “AO Foundation Berton Rahn Research Award” for the best AO funded external research project was awarded to Prof Rob Mauck, University of Philadelphia, for his work as part of ARI’s Acute Cartilage Injury Collaborative Research Program.

The AOTK approved MAXFrame hardware hexapod ring fixator displayed during the Meet The Experts session at the AO Davos Courses, December 2017

FUTURE OUTLOOK Implementation of a working process for third party collaboration on off-ramp projects Provision of innovative clinical solutions with evidence-based development A focus on dynamic and SMART fracture healing

AOTK Systemâ&#x20AC;&#x201C;celebrating the launch of ten new products in 2017 The AOTK proudly approved ten new products across trauma, spine and craniomaxillofacial (CMF) in 2017. The Femoral Neck System (FNS) was designed to address clinical challenges faced in the current fixation of femoral neck fractures and represents a less invasive competitor to the Dynamic Hip Screw. The External Fixation Expert Group added the MAXFrame hardware hexapod ring fixator to their robust portfolio allowing improved handling by both surgeons and patients. AOSpine TK approved the SYNFIX Evolution Secured Spacer System intended for stand-alone use in patients with degenerative disc disease (DDD). The current design incudes hyperlordotic cages and instrumentation techniques intended to negate the need for additional fixation. AOTK CMF introduced TruMatch Orthognathic; a revolutionary technological platform that integrates virtual surgical planning and the production of intraoperative patient-specific tools and personalized implants.

Annual Report 2017 â&#x201D;&#x192; AO Institutes

Dankward Hoentzsch sharing his clincial knowledge at the 12th European AOTK Expertsâ&#x20AC;&#x2DC; Symposium, Medical University, Mainz (DE), November 2017

Participants at the 5th US Symposium, Seattle (US), September 2017

Expert symposia The AOTK System successfully hosted three symposia in 2017. The first of the year took place in May in Chiang-Mai (TH) in conjunction with the AOTrauma Asia Pacific Courses. Chaired by Theerachai Apivatthakakul from Chiang Mai University Hospital, the event attracted 60 participants and included an upper extremity session in which faculty shared their insights into the challenges presented by complex elbow fractures and clavicle fixation. The 5th US Symposium took place in Seattle in September and was chaired by local pelvic surgeon and Director of Orthopeadic Trauma at the Tacoma Trauma Center, Keith Mayo. Inclusive of sessions on suprapatellar nailing and periprosthetic fractures, this more intimate event with 30 participants allowed for insightful and constructive case discussions about fixation challenges and potential future solutions. The 12th European Symposia which followed shortly after in November adopted a similar format with only 30 participants and plenty of case discussions. In addition to some of the same topics, the European based symposia hosted by Pol Rommens of the Medical University in Mainz also included sessions on the popular TFNA as well as fragility pelvic fractures. AOTK patient monitoring workshop The AOTK continues to strive for better patient care in the area of fracture monitoring and this Zurich based workshop was a follow-up to the successful Basel workshop held in 2016. The ability to monitor weight-bearing and load, and assess the effects of each upon fracture healing is a primary focus for the AOTK. Development in this area will serve to both progress patient rehabilitation and push the boundaries of product innovation. The collation of data and how this data should be used by hospitals to improve patient care and outcomes is certainly an open topic for discussion and decision in 2018.

A demonstration of pedicle screw insertion during the AOTK Meet The Experts session at the AO Davos Courses, December 2017

AOTK Chairman’s Strategy Summit In September the AOTK System hosted a Strategy Summit for all Expert Group Chairmen and key DePuy Synthes (DPS) representatives. The Zurich meeting was designed to encourage lively interaction between TK medical members and DPS about the most appropriate direction for future collaboration. Not only did the meeting generate discussion around future strategies for product development but it also raised questions around whether the AOTK is structured efficiently to ensure ongoing innovation. Off-ramp project opportunities Throughout 2017, the AOTK System worked hard to devise a new strategy to enable third party collaboration on projects categorized as unfunded, unaligned and subsequently ”off-ramp“ by DPS. The AOTK has never had such contractual flexibility regarding industry collaboration and as a consequence, the creation of a process to enable such external collaboration has been time consuming. It is expected that 2018 will bring significant steps forward with off-ramp opportunities through the identification of suitable projects and collaborators.

Annual Report 2017 ┃ AO Institutes

AOCID Advisory Committee Meeting, Stephen Kates and Risto Kontio, AO Trustees Meeting, Miami (US), July 2017

AO Clinical Investigation and Documentation (AOCID) A full pipeline The highlight of AO Clinical Investigation and Documentation (AOCID) in 2017 was building customer trust and increasing productivity; the result is a growth of internal service delivery by 19%. Dynamic project management Efficiency gains were key to AOCID’s improved customer service. Aside from a reorganization that delivered a clear division of responsibility, the newly implemented Earned Value Analysis (EVA) contributed to agile project management by gauging past performance of projects, future spending, and monitoring real-time progress of current initiatives. EVA allowed project managers to more accurately identify potential areas of concern and take timely actions. Improved collaborative processes Two noteworthy initiatives in 2017 were created to match AOCID’s quality management standards to specific internal client processes. The implementation of a “one-pager” with AOTK allowed AOCID to co-develop new studies with AOTK experts, while expediting the development of ideas into clinical studies. This one-pager approach was further developed by AOSpine, and will be implemented shortly. 38

FUTURE OUTLOOK Commercialize AOPEER Drive the cross-divisional AO eHealth initiative

AO Alliance–AOCID course on clinical investigation, Malawi (MW), March 2017

Leverage the Medical Device Regulation

A series of joint workshops with AOSpine were conducted to scrutinize each step of clinical study cooperation and to define roles and responsibilities. The next challenge is to define the handling of registries and their data. With the positive experience from previous workshops, the process for registry studies with AOSpine is expected to be implemented in 2018. Global rollout of AO Program for Education and Excellence in Research (AOPEER) The expansion of AOPEER continued. Twelve research courses were held in the USA, Thailand, Myanmar, Hong Kong, Malawi, United Kingdom, Egypt, Brazil, China, and Switzerland. Four new e-modules were created, four pillars of the Level II curriculum were developed, and a promotional video was launched targeting internal and third-party clients. Additional rollouts are planned for 2018. Progress on AOeHealth A cooperation with REDCapCloud, an electronic data capture system vendor, was established and negotiations for the cloud storage of research data are currently underway– AOCID can now offer a scalable, user-friendly, and up-to-date data capture system. The new EU General Data Protection Regulation will be implemented in 2018; AOCID has been preparing for this and will be ready to comply. Leveraging the new European Medical Device Regulation The new European Medical Device Regulation demands higher standards for medical device companies in providing clinical evidence. This may positively impact AOCID’s effort in expanding services to third-party customers, such as clinical studies, registries, and creating clinical evaluation reports. The AO participates in the SWISS MEDTECH actively through AOCID’s director Martin Schuler as a member of its Swiss Implementation Taskforce. 39

Annual Report 2017 â&#x201D;&#x192; AO Institutes

AO Video and Visual Media in production for a live surgical webcast streamed around the world

AO Education Institute (AOEI) New curricula on complex arthroplasty and periprosthetic fractures Two new AORecon courses were designed by surgeon committees using the curriculum development process from the AOEI; AORecon delivered its first complex arthroplasty course during the AO Davos Courses with Michael Huo (US) and Bas Masri (CA) as chairpersons. Focusing on revision and complex cases, this will be available worldwide as the next-level event after the AORecon Principles course. Collaboration between AOTrauma and AORecon, resulted in the Periprosthetic Fracture Management of the Hip and Knee course, offered for the first time at the Davos Courses. New teaching videos and online educational events AO Video and Visual Media (AOVM) worked with surgeons across the AO to ensure that the portfolio of teaching videos covers the latest principles and technical developments, and aligns with all simulation exercises in the curricula. Twenty-seven educational videos were produced and released: AOTrauma (17), AOSpine (five), AONeuro (three), and AORecon (one). AOVM also produced 29 live webinars from the AO studio in Zurich plus five multi-camera live surgical anatomical specimen webcasts from medical institutions throughout Switzerland.

The Third Edition of the ‘classic’ textbook AO Principles of Fracture Management was released in December 2017

FUTURE OUTLOOK Explore virtual reality (VR) simulations in education Move educational events into the hospital to the point of care Develop a cirriculum on the management of soft tissue

AO/OTA Fracture and Dislocation Classification Compendium—2018 The AOEI supported the International Comprehensive Classifications and Dislocations Committee (James Kellam, Julie Agel, Eric Meinberg, Matthew Karam, and Craig Roberts) with all resources and expertise required to produce the revised AO/OTA Fracture and Dislocation Classification Compendium–2018. AOEI also produced a new AO/OTA Fracture Classification App, dedicated website, a training video, and a brochure with the release of the revised compendium in December 2017. Record for faculty development activities In 2017, a total of 60 faculty development programs took place, enhancing teaching skills in lectures, small group discussions, and practical exercises. Courses assessing gaps in learners‘ needs, course design, and managing faculty through the Chairperson Education Program were also held. The Leader Education program addressed issues in intercultural teams, leadership style, and communication. Finally, new coaching programs enabled AO surgeons to give peer feedback and improve teaching practices. Release of AO Principles of Fracture Management Third Edition The new AO Principles of Fracture Management by Richard E Buckley, Christopher G Moran, and Theerachai Apivatthakakul explored new knowledge, cutting-edge techniques, and state-of-the-art technology developed around the fundamental principles of fracture surgery. New chapter topics include periprosthetic fractures, knee dislocations, radiation hazards, fragility fractures, and orthogeriatric care. Also, the introduction of QR codes for mobile devices, gives readers immediate access to AO’s ever-evolving online educational offerings.

Annual Report 2017 ┃ Finance

Finance Financial Overview A strong financial performance compensates for the increasing need for resources to cover additional and new activities to support the complex operational demands of the organization. Refined and globally aligned operational and financial processes for the AO Educational Events management (AO Global Education Process [GEP]) partly resulting in 5% higher Operating Expenses and 11% increase in the Operating Income compared to the previous year. The Operating Result has improved by CHF 3 million amounting to CHF -23 million compared to 2016. With CHF 166 million, the Financial Result is a solid performance reflecting the global financial market developments. As a result of this performance, the Net Result reached a level of CHF 143 million, leading to a strengthening of the Foundation’s Equity to CHF 1,372 million by the end of 2017. AO Financial Overview in million CHF

Operating Income

2016

2017

Variance A17/A16

abs.

abs. %

11 %

Operating Expenses

106

111

5 %

Operating Result

-26

-23

-12 %

Financial Result

166

104

168 %

Net Result

143

107

299 %

1,229

1,372

143

12 %

Equity per 31.12.

Operating Income includes the income from the Cooperation Agreements with DePuy Synthes of CHF 67.7 million and third-party income amounting to CHF 20.9 million. An increase of +64% versus the previous year is mainly a result of the newly introduced finance flows, a sub-process of the AO Global Education Process. Operating Expenses, excluding “Unforeseen,” “AO Strategy Fund,” “AO Alliance” contribution and ”AOIT Projects,” amounted to CHF 102 million (+4% versus previous year). The largest operating expenditures (69%) were related to “Education” (CHF 47.6 million) and “R&D” (CHF 23.2 million). “Education” spending increased by 15% versus the previous year, showing the impact of the newly-introduced process for the AO Educational Events management. This was partly compensated by additional income in “Education” and “R&D”, deferred spending in “R&D” (-11%) and further optimization and cost reduction measures in “Global & Regional Boards” (-6%).

Growth versus 2016 Actual

Breakdown 2017 Actual

in million CHF

5 %

4 % 2 %

Education

+15 %

R&D

6 %

-11 %

General & Administrative 14 %

CHF 102 m

23 %

Education R&D General & Administrative Community Development

46 %

+8 %

Community Development

+6 %

Global & Regional Boards

-6 %

AOTK System

-4 %

AONeuro/AORecon 0 Global & Regional Boards AOTK System AONeuro / AORecon

+5 % 10 2016 Actual 2017 Actual

Income Statement The 2017 Income Statement looks as follows in comparison to the previous year and budget: Income Statement 2016 Actual 2017 Actual in million CHF

abs %

Cooperation Agreements

67.4

Variance A17/A16

abs %

84 %

67.7

abs %

76 %

0.3

1 %

3rd Party Income

12.7

16 %

20.9

24 %

8.2

64 %

Total Operating Income

80.0

100 %

88.5

100 %

8.5

11 %

R&D

26.2

25 %

23.2

21 %

-3.0

-11 %

4.6

4 %

4.4

4 %

-0.2

-4 %

AOTK System Community Development

5.3

5 %

5.6

5 %

0.3

6 %

Education

41.4

39%

47.6

43 %

6.2

15 %

General & Administrative

13.3

13 %

14.4

13 %

1.0

8 %

Global & Regional Boards

5.0

5 %

4.7

4 %

-0.3

-6 %

10.2

10%

11.4

10 %

1.2

12 %

Total Operating Expenses

Others

106.1

100 %

111.3

100 %

5.3

5 %

Operating Results

-26.0

-22.8

3.2

27%

Financal Results

62.0

166.3

104.2

79%

Net Result

36.0

143.5

107.5

75%

The Cooperation Agreements were CHF 67.7 million as budgeted (+0%) and slightly above the previous year (+1%). Thanks to a higher Financial Result amounting to CHF 166 million, a Net Result of CHF 143 million could be realized and allocated to the Foundation’s reserves. Operating Expenses at CHF 111.3 million, is above previous year’s amount but reflects a budget underspend by 2% due to lower “R&D” expenses, and lower expenses in various operational areas.

Employees The number of permanent staff increased to 264.0 full-time equivalents (FTEs), an increase of 21.3 FTEs or 9% versus 2016. FTE weighted permanent 2016 Actual 2017 Actual Total located in Switzerland Asia Pacific Latin America North America Total FTE permanent worldwide

Variance A17/A16

abs.

in %

abs.

in %

abs.

210.5

87 %

230.9

87%

20.4

15.0

6 %

14.3

6 %

-0.7

9.1

4 %

11.0

4 %

1.9

8.1

3 %

7.8

3 %

-0.3

242.7

100 %

264.0

100 %

21.3

2017 FTE Overview by Area (weighted permanent)

7.0; 3 % 48.7; 18 %

Clinical Divisions Support Units Others

264.0 FTE

Institutes

89.1; 34 % 119.1; 45 %

Annual Report 2017 ┃ Finance

Finance Course activities by region The total number of courses increased to 830, reflecting a growth of 3% versus 2016. Overall, the number of participants increased by 5% as well as the number of participant days which increased by 3%. Region Number of Courses Number of Participants 2017 Share Vs. 2016 2017

Number of Participant Days

Share Vs. 2016

2017 Share Vs. 2016

Asia Pacific

192

23%

-1%

15,350

28%

30,792

27%

Europe (incl. South Africa)

285

34%

13,259

24%

-10%

32,053

28%

-2%

Latin America

165

20%

11,899

22%

21,661

19%

17%

Middle East and Africa

20%

3,400

13%

7,577

North America

-4%

5,388

10%

21%

11,905

10%

12%

International

4,888

-1%

9,700

-15%

830

100%

54,184

100%

113,688

100%

Total

Asset Management The Asset Management Result of CHF 172 million reflects the return of 14.4% on the underlying financial assets amounting to CHF 1,344 million by the end of 2017. All asset classes, except for liquidity, contributed to a positive return. The main drivers of this performance were the double-digit returns in all three segments “Switzerland,” “Developed,” and “Emerging Markets” of the asset class “Shares” with a share of 61% of the total assets. The outperformance relative to the benchmark of +13.3% is mainly due to the exposure to Small and Mid Cap Equities in Switzerland. The cumulative performance of the portfolio since January 2008 amounted to 65.6% by December 31, 2017.

in million CHF

Shares Bonds Swiss Real Estate Alternative Assets Liquidity

819 356 68 68 33

Total

5% 2%

61%

CHF 1,344 million 27%

1,344

946

in million CHF

Evolution 2010 – 2017

982

962

981

1,048

1,142

1,223

1,193

1,229

1,372

Total shares Bonds Swiss Real Alternative Liquidity

2009

2010

2011

2012

2013

2014

2015

2016

2017

Equity evolution 2010-2017 Due to the favorable financial markets in 2017, the Foundation’s Equity increased to a value of CHF 1,372 million by December 2017.

Transparency The Transparency Policy introduced in 2016, outlined that the AO Foundation will publish annually the total remuneration of the AOFB, international boards of the clinical divisions, and the AO Executive Management in addition to disclosing all scientific grants to third parties. Remunerations per board The total remunerations summarized for all governance activities of the International Funding Boards in 2017 were CHF 1,406,124.- (2016: CHF 1,505,735.-) which is 1.3% (2016: 1.4%) of the total Operating Expenses of the AO Foundation and its institutions. The table below shows the total remuneration of each individual International Board in absolute amounts CHF and as a % of the total amount of individual Operational Expenses, as well as the absolute amount of the highest stipend within each board in 2017: 2016 AO Foundation Board Total AOFB % of total Operating Expenses AO Foundation Highest Stipend AOFB AOTrauma International Board Total AOTIB % of total Operating Expenses AOTrauma Highest Stipend AOTIB AOSpine International Board Total AOSIB % of total Operating Expenses AOSpine Highest Stipend AOSIB AOCMF International Board Total AOCMFIB % of total Operating Expenses AOCMF Highest Stipend AOCMFIB AOVET International Board Total AOVETIB % of total Operating Expenses AOVET Highest Stipend AOVETIB Grand Total

2017

10 members

386,250

317,500

0.4%

0.3%

125,000

75,000

10 members

375,000

1.4%

1.3%

100,000

75,000

10 members

11 members

425,000

393,750

100,000

9 members

275,000

3.8%

3.6%

100,000

8 members

9 members

44,485

44,874

2.3%

1.5%

30,000

1,505,735

1,406,124

Remuneration of the AO Executive Management The total annual compensation of ten members of the AO Executive Management in 2017 was CHF 2,686,715.- (2016: CHF 2,541,035.- for nine members). The highest individual compensation was CHF 331,575.- resulting in a 1/5.1 relative ratio between the highest and the lowest paid individual compensation (permanent employees).

Assignment of scientific and other grants to third party organizations In 2017, AO Foundation funded research projects with scientific and other grants in a total of CHF 1,607,707.- (excluding Strategy Fund contributions) in forty-five different 3rd party organizations (2016: CHF 4,339,277.- including Strategy Fund).

Annual Report 2017 ┃ Governance

AO governance level A clear separation between governing and executive bodies guarantees optimum organizational governance.

Decision-taking function Advisory function

ANNUAL AO TRUSTEES MEETING

Assembly of Trustees

ANNUAL GENERAL MEETING AOTAG

AO Foundation Board (AOFB)

AO Foundation President

Main tasks include: approval of vision and mission; setting scientific and clinical goals; election of President, elected Trustees and AOFB; resolutions to change the Charters and Bylaws and the discharge of AOFB members

Highest supervisory and executive body whose main tasks include: strategy; fund allocation to AO units; financial and risk management; compliance and legal structure; election of chairpersons and other key positions; supervision

Institutes‘ Advisory Committees

Platforms

AO Technology AG (AOTAG) CEO and Vice-Chair AOFB Strategy and management of commercial activities, intellectual property, and financial assets of AO

Clinical Divisions‘ International Boards

Guidance of the respective Institute in their corresponding content issues

Support and advise AOFB in its governing tasks and interactions with stakeholders

Strategic and financial supervision and measuring CD outcomes

AO Research Institute Advisory Committee

Education Platform

AOTrauma International Board

AO Clinical Investigation Advisory Committee

R & D Platform R & D Expert AOFB

AOSpine International Board

AO Education Institute Advisory Committee

Community Development Platform

AOCMF International Board

President-Elect

CD Expert AOFB

AOTK System Executive Board Strategic and financial supervision and outcome measurement of AOTK

AO Development Incubator Board Approves innovative proposals to develop to proof-of-concept stage

AOVET International Board

AO executive level The executive functions of the AO Foundation are directed by the CEO and Vice-Chair of the AO Foundation Board and are divided into three layers (institutes, clinical divisions, and support units) that work closely with each other. Governing function

Executive function

AO Foundation Board (AOFB) AO Foundation President

AO Executive Management (AOEM)

Human Resources

CEO and Vice-Chair AOFB

Information Technology

AOTAG Managing Director

Institutes

Clinical Divisions

Support Units

Directors

Executive Directors

COO

AOTrauma Intl. Board

AOSpine Intl. Board

AOCMF Intl. Board

AOVET Intl. Board

AOTrauma

AOSpine

AOCMF

AOVET

ARI Advisory Committee

Finance

AO Research Institute Davos AOCID Advisory Committee AO Clinical Investigation AO Education Institute Advisory Committee

Communications & Events Matrix organization • Execution, supervision and outcome measurement of activities according to direction setting/policies by AOFB, AOEM and international boards of clinical divisions with the support of the AO Foundation • Submission of proposals for decision shaping and strategy development • Installation of transparent, compliant and efficient structure and processes and best use of synergies

Legal

Facility Management

AO Education Institute AOTK System Executive Board AOTK System

AO Development Incubator Board AO Development Incubator Program Manager

Annual Report 2017 ┃ Governing bodies of the AO Foundation

Governing bodies of the AO Foundation Assembly of Trustees The Assembly of Trustees is the “AO parliament,” consisting of 131 leading surgeons from around the world comprising: 49 Elected Trustees, 68 Ex-Officio Trustees, 14 Past Presidents, and Founding Members. The Assembly of Trustees is responsible for the approval of the scientific and clinical mission of the AO Foundation, important elections, and the modification of the AO Foundation Charter and Bylaws. They transmit AO information to national institutions, other AO surgeons, and bring feedback regarding the specific needs of their region. There are also 28 Honorary Members that are invited to attend the meetings. At the Trustees Meeting 2017 in Miami (US), the Trustees approved the proposal to reduce the number of Trustees to 100 voting members. The new structure will be comprised of: 52 Ex-Officio Members, 30 Regional Members, 14 Past Presidents and Founders plus a reserve of four members to manage changes in Ex Officio categories and five wildcards to manage transitional changes. All current Trustees will serve until the end of their term before gradually being phased out. Once the number of Elected Trustees (new Regional Members) drops below 30 (in 2020) the new Regional Members will be brought in. By 2021 the new Trustee structure will have been realized.

AO Foundation Board (AOFB) The AO Foundation Board is the governing body of the AO Foundation. It is responsible for its strategies, target setting and supervision of all executing bodies of the AO Foundation. Front row: Robert McGuire (President-Elect) Rolf Jeker (CEO and Vice-Chair AOFB) Nikolaus Renner (President and Chair AOFB) Suthorn Bavonratanavech (Past President)

Middle row: Christoph Lindenmeyer (finance expertise) Florian Gebhard (trauma expertise) Ulf Claesson (investment/industry expertise) Keita Ito (R&D expertise) Jean-Pierre Cabassu (veterinary expertise)

Back row: Jeffrey Wang (spine expertise) Neal Futran (craniomaxillofacial expertise)

AO Executive Management (AOEM) The AO Executive Management reports directly to the AO Foundation Board. It includes the CEO and line managers responsible for operational management within their respective areas.

Front row: Irene Eigenmann Timmings (COO and CFO) Rolf Jeker (CEO and Vice-Chair AOFB) Eberhard Denk (AOVET)

Middle row: Jayr Bass (AOSpine) Urs Rüetschi (AO Education Institute) Martin Schuler (AO Clinical Investigation and Documentation) Claas Albers (AOTK System)

Back row: Tobias Hüttl (AOTrauma) Erich Röthlisberger (AOCMF) R Geoff Richards (AO Research Institute)

Annual Report 2017â&#x201D;&#x192; Addresses

AO Head Office

AO Clinical Divisions

AO Institutes

AO Foundation

AOTrauma

AO Research Institute Davos

Clavadelerstrasse 8

7270 Davos

Switzerland

Phone +41 81 414 28 01

Phone +41 81 414 21 11

Phone +41 81 414 22 11

Fax

+41 81 414 22 80

+41 81 414 22 88

foundation@aofoundation.org

info@aotrauma.org

sonia.wahl@aofoundation.org

www.aofoundation.org

www.aotrauma.org

www.aofoundation.org/ari

AOSpine

AO Clinical Investigation and

Clavadelerstrasse 8

Documentation

7270 Davos

Stettbachstrasse 6

Switzerland

8600 DĂźbendorf

Phone +41 81 414 21 11

Switzerland

Fax

Phone +41 44 200 24 20

+41 81 414 22 80

info@aospine.org

Fax

www.aospine.org

aocid@aofoundation.org

+41 44 200 24 60

www.aofoundation.org/cid AOCMF

AOTK System

Clavadelerstrasse 8

7270 Davos

Switzerland

Phone +41 81 414 25 55

Phone +41 81 414 24 70

Fax

+41 81 414 25 80

+41 81 414 22 90

info@aocmf.org

aotk@aofoundation.org

www.aocmf.org

www.aofoundation.org/tk

AOVET

AO Education Institute

Clavadelerstrasse 8

7270 Davos

Switzerland

Phone +41 81 414 25 55

Phone +41 81 414 26 01

Fax

+41 81 414 25 80

+41 81 414 22 83

info@aovet.org

aoe@aofoundation.org

www.aovet.org

www.aofoundation.org

*Contact information for regional offices can be found on individual clinical division websites.

Concept, editing, and layout: AO Foundation, Communications and Events, Davos, Switzerland Photography: AO Foundation, Communications and Events, Davos, Switzerland Manuel Kurth (pages CI-1, 4-5, 6-7, 8-9, 10-11, 12-13, 14-15, 50-51, 52) Print: BUDAG, SĂźdostschweiz Presse und Print AG, Davos, Switzerland ÂŠ April 2018, AO Foundation This annual report is climate neutral, compensation through www.climatepartner.com Certificate No SC2014040102

AO Foundation Annual Report 2017

Articles inside

Highlights of 2017

Operational Excellence

Corporate Social Responsibility

Innovation

Facts and Figures