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  "documentTitle": "Penumbra, Inc. (PEN)",
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  "authorName": "Spruce Point Capital Management",
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  "presentationDate": "2019-07-31 00:00:00",
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  "pageNumber": 10,
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  "nDataPoints": 80,
  "notes": "The table models a 'race to the bottom' pricing strategy for Medtronic's aspiration products to gain market share.",
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      "kind": "callout",
      "text": "With the market-leading stent retriever and well-received aspiration catheters, Medtronic could likely take aspiration share extremely rapidly (as it has been) by temporarily giving away its aspiration catheters for free, or selling it at a steep discount. It would not sacrifice near-term gross profit growth by doing so, and could position itself for longer-term segment growth by establishing itself as the dominant player in neurovascular mechanical thrombectomy. With limited ability to bundle on its own, Penumbra could face significant price compression in its core aspiration vertical without an opportunity to compensate by growing share in its relatively underpenetrated stent retriever vertical.",
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      "kind": "callout",
      "text": "With limited ability to bundle on its own, Penumbra could face significant price compression in its core aspiration vertical without an opportunity to compensate by growing share in its relatively underpenetrated stent retriever vertical.",
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      "text": "Gross Profit: 77%",
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      "text": "We estimate that, even if it were to give its stent retrievers away for free as part of its mechanical thrombectomy bundles, Medtronic would be able to grow its mechanical thrombectomy profit dollars through 2019, even when assuming no stent retriever share gains.",
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      "kind": "source-note",
      "text": "1. Assumes slightly above company-wide gross margin, per conversations with industry experts. Accessory quantities equal to sum of aspiration and stent retriever units.",
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      "text": "Scenario analysis table comparing Medtronic and Penumbra metrics across 2018 and 2019E with varying aspiration pricing.",
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      "kind": "title",
      "text": "Discounted Bundling By Deep-Pocketed Mega-Cap Competitors Threatens Industry Pricing",
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      "evidence": "The document presents Penumbra's weaknesses, such as slowing growth and market share loss.",
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