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June 09, 2016 | Tecomet Appoints New President and CEO

Tecomet, reportedly the largest contract manufacturer catering to the orthopaedic industry, has appointed Mark Kemp to the position of President and Chief Executive Officer.

Kemp brings a wealth of medical device experience to this new role. Previously, he spent 16 years with Flextronics in progressively responsible roles, most recently serving as President Flextronics Medical. Kemp has over 20 years of experience with M&A and integration activity and has grown a medical division from $200MM to $1.8BB; this included securing strategic partnerships with 19 of the top 25 medical OEMs.

“Mark has provided a new outlook and a refreshing prospective by providing guidance and overall leadership for our company since joining Tecomet in October 2015. The Board is very pleased to have Mark with Tecomet and now stepping up to the CEO role,” stated Bill Dow, Chairman of the Board.

In 2015, Tecomet reported organic growth at an excess of ten percent over the previous six years. In addition, the company said that it would continue its acquisition activity moving forward, with a plan to specifically target companies offering services that Tecomet currently outsources.

May 19, 2016 | Midwest Orthopaedics at Rush Offers Flat Fee Payment Option, Shares Price Structure Online

Midwest Orthopaedics at Rush (MOR), in Chicago, Illinois, is now offering patients package pricing—a flat fee payment option—for treating some of the most common orthopaedic conditions. MOR has listed the price structure on their website.

At present, there are five surgical procedures that are included in the MOR Package Pricing: 

  • Anterior Cruciate Ligament (ACL) Repair, $10,800
  • Hip Arthroscopy, $13,250
  • Knee Arthroscopy, $5,000
  • Rotator Cuff Repair (Arthroscopic), $11,300 
  • Shoulder Arthroscopy, $10,000 

 

Services provided in this program are not billed to any third parties or insurance plans. Some expenses not included in the MOR Package Pricing include preoperative diagnostic tests, travel expenses, durable medical equipment and physical therapy. 

“We wanted to create something that was geared towards consumers,” says Dennis Viellieu, CEO, Midwest Orthopaedics at Rush. “This has not really been done. Some states have required that some of this information be put out there, but it doesn’t necessarily help consumers because they don’t understand CPT codes, for example. You can’t expect them to understand that.” 

The program is geared toward the uninsured and individuals with high deductibles. Viellieu says that as the Affordable Care Act has marched forward, out-of-pocket expenses for plans offered on the exchanges have increased dramatically. For some, it now makes more sense to pay the penalty rather than enroll in an exchange-based plan. Largely, that means MOR’s packaged, transparent pricing is targeting young people and those who may not access the healthcare system frequently.

Package pricing gives those patients an option to go out-of-pocket, without accessing a third-party, and receive one price for the whole surgical episode. The package pricing is also attracting interest from those outside the country. Viellieu specifically mentioned strong interest from Canadians, because they understood the quality of MOR’s physicians and could understand the pricing structure easily.

MOR determined the pricing structure by visiting facilities where these procedures are performed, and asking them to provide what they would consider to be a reasonable reimbursement for each procedure. Then they put the numbers together, created an average and set a price for the whole service. Villieu says that it was a straightforward process that largely involved talking to other providers and partners. 

“We’re going to expect some variation around the average. Some of that you’ll know going in, some of it you won’t,” he says. “We’ll live with the variation that we don’t know and if we do know, and it meets exclusion criteria, then we’ll have a conversation with the patient.” 

While setting those prices, MOR’s team didn’t focus on implant pricing or cost, Villieu says. They figured out the average cost of an implant or medical device for a specific surgery and then set the average. However, now that the program is public, there have been unintended consequences on the implant side. 

“Having the surgeon be more aware of implant cost as a variable element within a price package, over the long term, will have a beneficial impact. It makes sure that we’re being as efficient as possible,” he says. 

He adds that there are cases in which a surgeon might feel more comfortable taking two implants into the OR, but only one implant may be needed. In those cases, it may be more efficient to take only one implant into the OR to avoid the waste. 

“There will be more thought about efficiency as a result of this package. That’s not something that we counted on when we went into this, but it’s a natural extension of seeing how these cases perform versus how we thought they would perform,” Villieu says. 

After being public for only a week, MOR already plans to add more package options to its offerings. The bundles will target other common orthopaedic procedures performed by the physicians at MOR. 

In 2009, the Surgery Center of Oklahoma (SCO) transitioned to a similar model. The hospital provided a complete list of procedures with an accompanying price tag and posted it on their website.

In an interview with ORTHOWORLD, SCO co-Founder and Medical Director Kevin Smith, M.D. said that self-funded companies with 1,500 employees experience health plan savings of about $1 million per year compared to their Preferred Provider Organization allowable amounts. He added that SCO prices are typically 1/6th or 1/10th that of “big box” hospitals for the same procedures. 

By 2015, SCO’s volume had increased 30 percent and its profits had doubled, according to Smith.

April 13, 2016 | OrthoWorx Launches AcceLinx to Fuel Entrepreneurial Environment

Entrepreneurs in Warsaw, Indiana will soon have an additional resource to assist in the development and launch of new medical devices. OrthoWorx, a community-based organization that works with the local Warsaw orthopaedic industry, revealed the new initiative, AcceLinx.

AcceLinx was developed with the understanding that innovation in orthopaedics has become more complex and the timeline from concept to market has extended to six or more years due to regulatory and reimbursement scrutiny. Selected entrepreneurs will have access to strategic resources, guidance and technical and production support from in-house AcceLinx experts, as well as partnering companies. 

The initiative also serves the needs of Warsaw’s established orthopaedic companies. OrthoWorx noted large companies like DePuy Synthes and Zimmer Biomet acquire technologies and companies that are further along in the development cycle and have proved the regulatory pathway, clinical performance and commercial potential. AcceLinx will serve as an engine to get technologies and companies to the desirable acquisition phase and has potential to fuel a product and personnel pipeline for orthopaedic companies of all sizes.  

The Indiana Economic Development Corporation (IEDC) pledged up to $1.2 million over six years in funding to establish and operate AcceLinx. The City of Warsaw committed $500,000 in funding to the initiative. An additional $4.8 million is needed to fund the initiative's operational budget for the six years.  

Though a separate entity of OrthoWorx, AcceLinx will initially be housed within the OrthoWorx office until a team and physical location are established. Future announcements will be made on how entrepreneurs will be selected.

Sheryl Conley, OrthoWorx President and CEO, called out the late Dane A. Miller, Ph.D., founder of Biomet, as one community leader who inspired the initiative.   

OEMs and suppliers in Memphis established a local medical device council in 2014 to develop workforce training and education opportunities that would ensure a local talent pool.

April 04, 2016 | Lima Ownership, SNN's REDAPT and FDA Reclassification Activity Top March 2016 News

What ORTHOFLASH news was the most popular during March?

The Ownership of Lima Corporate

EQT, a global private equity group, with Hansjörg Wyss as co-investor, completed acquisition of the majority of shares of Lima Corporate in March 2016. A newly-formed Advisory Board includes Doug Kohrs, former CEO and President of Tornier.


Smith & Nephew Unveils REDAPT Revision 3D-Printed Titanium Hip

The device, debuted at AAOS 2016, is now available on a limited basis in the U.S.


FDA Proposes Classification of Posterior Cervical Screws

Since 2001, FDA has regulated posterior cervical screw systems as unclassified pre-amendments devices requiring premarket notification (510(k)). The Agency FDA will accept comments on Class II assignment through June 8, 2016.


In’Tech Medical Acquires Ortho Solutions in Asia

The contract manufacturer increased its global footprint in this transaction that followed its 2015 acquisition of Turner Medical.

March 29, 2016 | Reimbursement Complexity Centers on Need for Longer-Term Studies

ORTHOWORLD® Members of all stripes—providers, OEMs and suppliers—say that they’ve been impacted by complexities in the reimbursement system. Reimbursement certainly is not a new challenge. The push for longer-term data, though, is no longer a nice-to-have selling tool, but a must-have for coverage.

“The biggest challenges to obtaining reimbursement from a payor come from not establishing a business case or a cost-effectiveness argument. It’s all about establishing medical necessity for that item or service,” says Richard Baer, M.D., a reimbursement consultant. “The literature has to establish improved health outcomes.”

Baer previously served as Medical Director for the Medicare RAC Validation Contractor and as Lead Medical Director for National Government Services, one of the largest Medicare administrative contractors in the U.S. He says that the key to obtaining reimbursement is the quality of the scientific literature. For orthopaedic devices, that may mean robust, double-blinded control studies at academic centers. He says that studies should push for large patient populations, with studies of at least 100 patients looking more credible.

“The thing that payors are looking for, and is new in the landscape as a barrier to coverage, is longer-term evidence. In the past, particularly for a device, a six-month study was sufficient. Now, payors want to see two-, three- or five-year follow-ups to make sure that the item they’re paying for is durable and the benefit is sustainable,” he says. “One thing that payors are now requiring as a product is coming to market is that companies go back and do another study.”

Kelli Hallas, Executive Vice President of Emerson Consultants, notes that many of the studies being conducted are postmarket, undertaken to satisfy the requirements from payors for coverage, frequently at great expense to the device company.

One step that companies should take to ensure coverage is to open channels of communication with their prospective payors. “When a clinical protocol is being developed to support the regulatory strategy, companies need to have communications with the payor community to ensure that the data they’re collecting will fulfill the payor’s requirements for coverage,” she says.

Baer agrees. “When you’re developing your strategy for a new product, the requirements of the payors need to be taken into account. Your strategy has to extend from project startup through payor coverage, not from project startup through FDA clearance,” he says.

 

The full article appeared in the April issue of ORTHOKNOW.
In recent years ORTHOWORLD interviewed executives on the barriers to data collection and the benefits of strong data.


 

March 10, 2016 | Revenue, Episealer and Metal-on-Metal Top February News

What ORTHOFLASH news was the most popular during February?

Financial reviews:

Year-end and full-year revenues for CONMED, DePuy Synthes, Smith & Nephew, Stryker and Zimmer Biomet, while primarily published in January, topped the clicks in February. Of these, more users accessed DePuy Synthes than any other revenue recap—but of financials, readers spent the most time absorbing Zimmer Biomet’s results.

 

Study results: Episealer may stop or significantly slow the process leading to OA

Study results suggest that a permanent bond may form between cartilage and the hydroxyapatite coating of Episurf’s Episealer® device, suggesting that implantation of Episealer may stop or significantly slow the process that leads to osteoarthritis. This is reported to be the first time that such results have been shown, clinically.

 

FDA Issues Final Order on PMAs for Metal-on-Metal Hips

FDA issued a final order requiring OEMs to submit a premarket approval application for certain metal-on-metal total hip replacement devices, believing that there is insufficient evidence to conclude that general and special controls would provide reasonable assurance of the devices’ safety and effectiveness.

 

Zimmer Biomet Receives FDA 510(k) Clearance for Unite3D Bridge Fixation System

This 3D-printed technology is designed for use in foot and ankle arthrodesis. Unite3D is made from OsseoTi® porous metal technology, which mimics the structure of cancellous bone.

 

Tyber Medical Launches TyWedge Evans and Cotton Osteotomy Wedge Systems

This represents full market launch for these systems that feature TyPEEK® proprietary titanium plasma-sprayed PEEK coating, which is specifically indicated for fusion. Tyber Medical's portfolio now spans >26,000 product configurations contained across 15 product lines.

February 19, 2016 | Stryker Strengthens Investments in 3D Printing, Robotics

Stryker announced the construction of a state-of-the-art 3D printing manufacturing facility in order to produce new products across multiple divisions and set the company apart from its competitors.

The announcement came during the company’s fourth quarter earnings call, when leadership cited knee and spine as the first markets in which it plans to focus its 3D printing efforts. Stryker’s U.S. knee segment experienced 9.1 percent organic growth in the fourth quarter of 2015, bolstered by the adoption of recent cementless tibia plates, patella and revision cones made of 3D printed titanium. The company plans to launch a 3D printed titanium interbody device for spine in 2016.

“For the foreseeable future, at least the next three, four years or so, our focus is on innovative new products and not replacing our existing products with 3D printed products,” said William R. Jellison, Stryker’s retiring Vice President and Chief Financial Officer, during the call. “The pipeline of innovative new geometries that can’t be made without 3D printing is the area of focus. It’s not about trying to replace our products and drive down cost. Over time, ten years from now, that could be the case, but in the near- to mid-term, it’s really a focus on innovative new products.”

As evidenced by its 3D printing investment and acquisition of MAKO Surgical in 2013, Stryker seeks a differentiated approach, especially in joint reconstruction, from its main competitors DePuy Synthes, Smith & Nephew and Zimmer Biomet.

Robotics and additive manufacturing (3D printing) are two hotly-discussed topics in the orthopaedic industry. Manufacturers believe that both are innovative technologies that may improve patient outcomes via better implant positioning (robotics) and greater bony in-growth (3D printing). The challenge that many face is how to make the technology cost-effective or rationalize the price both internally and for buyers.

Robotics and 3D printing are not expected to be big growth drivers for Stryker in the near term, said Kevin Lobo, Chairman and CEO. Its core joint reconstruction growth will continue to come from the Triathlon knee and Accolade hip systems. However, recent investments will provide incremental growth and set up Stryker’s sales reps for conversations that competitors aren’t having.

“Over time, I expect robotics and 3D printing to take on a more important portion of our overall sales, and they will be sustainable and sticky if we have something that the competition doesn’t have,” Lobo said.

Stryker also announced the acquisitions of Sage Product, a provider of goods for intensive care units and hospital settings, and Synergetics USA's neuro portfolio. The Sage Product's $2.77 billion all-cash transaction, reportedly the company’s biggest-ever acquisition, positions Stryker to respond faster to “Never Events” such as infections. The acquisition is part of Stryker’s MedSurg division, but is expected to play a role in orthopaedics as bundled payments and episode of care receive a heightened focus. The Synergetics neuro portfolio is expected to complement Stryker Instruments' neuro, spine and ENT business. Synergetics achieved revenue of $31 million in 2015. 

A look at Stryker's 2015 year in review can be found here.

February 19, 2016 | FDA Issues Guidance for Ultra High Molecular Weight Polyethylene Devices

In the first of several possible material updates in 2016, FDA released draft guidance outlining new information companies must include when submitting devices with Ultra High Molecular Weight Polyethylene (UHMWPE) for approval.

FDA’s recently-released draft guidance, titled “Characterization of Ultrahigh Molecular Weight Polyethylene (UHMWPE) Used in Orthopedic Devices,” breaks UHMWPE materials into four groups: Conventional UHMWPE, Highly Crosslinked UHMWPE, Vitamin E Highly Crosslinked UHMWPE and Non-Conventional UHMWPE. Each offers individualized recommendations for what to include in submissions. 

FDA provided a list of general information that should be included with any submission, regardless of UHMWPE type. That list includes: 

  • Starting resin (e.g., GUR 1020, GUR 1050, HiMont 1900) 
  • Concentration and identification of antioxidant or other additives (in weight percent and parts per million) 
  • Resin consolidation method (e.g., ram extrusion, compression molding, etc.) 
  • Radiation dose and type (e.g., gamma, electron beam, etc.)  
  • Time and temperature of all post-consolidation thermal anneals (e.g., to reduce free radicals, relieve internal stresses, homogenize dopant concentration, etc.)  
  • Compression ratio of all mechanical anneals 
  • Terminal sterilization method


The draft document also provided the specific suggestions for information to include with each UHMWPE grouping. 

For Conventional UHMWPE, FDA recommends including: 

  • Tensile properties (e.g., yield strength, ultimate tensile strength, elongation at break) 
  • Impact resistance (either Charpy or Izod)  
  • Density 


For Highly Crosslinked UHMWPE/XLPE:

  • Comparison of the total absorbed radiation dose to the dose of a legally marketed device 263 with the same intended use
  • Percent crystallinity
  • Melting temperature
  • Biaxial mechanical properties (ultimate load, ultimate displacement, work to failure)
  • Post-accelerated aging oxidation index throughout the sample
  • Trans-vinylene index throughout the sample
  • Crosslink density
  • Fatigue resistance crack propagation testing (ΔKinception, Paris exponent, Paris 271 coefficient) 
  • Free radical concentration


For Vitamin E, Highly Crosslinked UHMWPE/VEPE, submissions should include the information provided for Conventional UHMWPE and Highly Crosslinked UHMWPE, in addition to these specific requirements:

  • Stability of antioxidant in the material
  • Effect of antioxidant on the wear mechanism
  • Effect of antioxidant on material consolidation


For Non-Conventional UHMWPE, FDA did not provide specific recommendations. 

Orthopaedic device companies can expect a greater focus on materials from FDA in the coming year. Two of FDA’s 2016 scientific priorities relate to materials: 1) modernize biocompatibility/biologic risk evaluation of device materials, and 2) advance methods to predict clinical performance of medical devices and their materials. Both priorities relate to improving methodologies and tools for material testing to ensure the quality and safety of the material, and ultimately the device. 

Also, FDA has issued a final order requiring OEMs to submit a premarket approval application for certain metal-on-metal total hip replacement devices. The PMA must report all nonclinical and clinical information from investigations on the safety and effectiveness of the device. 
 

February 03, 2016 | Surgeons Offer Device Companies Wish List of New Technologies

Despite the myriad top-down pressures that surgeons face, many believe there is room for new advancements to improve current industry conditions. In our annual ORTHOPRENEUR Editorial Board query, surgeons discuss the technologies they seek and potential areas for exploration to move orthopaedic care forward in the coming year.

Surgeon participants included:

Alejandro Badia, M.D., Orthopaedic hand and upper limb surgeon, Founder of OrthoNOW, an orthopaedic urgent care center franchise
C. Scott Humphrey, M.D., Orthopaedic shoulder and upper extremity specialist, Founder and Chief Innovation Officer of Shoulder Options, Founder and Director of Humphrey Shoulder Clinic
Blair Rhode, M.D., Orthopaedic sports medicine surgeon, Founder of Rhode Orthopedic Group (RōG) and Orland Park Orthopedics Center for Sports Medicine
Blaine Warkentine, M.D., Healthcare Innovations Architect, Founder of Vimty and SurgeryTrack

ORTHOPRENEUR: What technologies would you like to see emerge in 2016 and beyond? 

Badia: The concept of telemedicine is a good one that’s long overdue. For a lot of the patients we see, particularly in follow-up, there is no reason for them to actually come in and see us. A patient could sit in front of the computer screen and show us her arm or motion and ask relevant questions. A lot could be done with telemedicine to scale down costs and actually decrease some of our aggravation in the office, because we’d be able to see some of the patients whom we just need to quickly see. We’re working to incorporate this concept in our OrthoNOW approach.

Humphrey: I’d like to be able to perform more complex surgeries on an outpatient basis rather than having to admit patients to a hospital. Keeping people out of the hospitals would save them a lot of money, and it would allow me to maintain an independent practice. A nerve block that lasts three to four days and doesn’t require a catheter would be welcome.

Rhode: A continued roll-out of stable technology offerings. I would like to see more offerings for disposable physician preference devices. Shaver blades and thermal devices are two examples that need stable market-based competition. The movement toward stable technology in the device arena continues. At RōG, we have continued to acquire more, and more surgery centers begin to use our stable shoulder anchors. 

Warkentine: I’d like to see more about at-home rehabilitation, outcome management and tracking and sensor data.

ORTHOPRENEUR: How do the shifts in patient demographics impact your view on and use of new technologies and techniques?

Badia: The aging population is going to impact healthcare costs in orthopaedics, obviously more with joints.

I want to emphasize proven stem cell technologies. The problem with stem cells is that they are this buzzword and are being abused. People who don’t know much about stem cells are injecting peoples’ joints and charging a heck of a lot of money. I think we’re going to see refinement and clarification of the indications in the next one to two years. We’re not going to be able to do total joint replacements on everybody who ages. It’s just not sustainable, nor desirable. 

Humphrey: Hospitals have become tight when it comes to allowing new technologies in the OR due to cost concerns.

Gone are the days when hospitals would pay a premium because something is “new and improved.” Similarly, physician-owned surgery centers are really watching their costs. Going forward, new technologies will need to be priced in the same range as existing technologies or they won’t gain traction.

There needs to be a continued focus on improving outcomes and making procedures more efficient, but going forward, cost containment will be more important than ever.

ORTHOPRENEUR: What one thing would you like to share with device companies?

Badia: The days of companies charging exorbitant fees are past us. Companies that are sensitive to that, they’ll stay in the game.

Humphrey: There needs to be a continued focus on improving outcomes and making procedures more efficient, but going forward, cost containment will be more important than ever.

Warkentine: Companies should be aggressive to move to eCommerce systems for hospitals.

The full article can be read here.

January 04, 2016 | Congress Suspends Medical Device Tax
The medical device tax, fought by industry since its inception, was suspended as part of the $1.8 trillion spending and tax bill passed by Congress and signed by President Obama in the waning days of 2015.
 
The 2.3 percent tax on medical device sales received a suspension for 2016 and 2017, and is expected to cost the U.S. $3.4 billion during those two years, according to the Joint Committee on Taxation.
 
Associations like AdvaMed and MDMA quickly applauded the news, noting that the tax had cost the medical device industry jobs and pinched research and development resources.
 
  • An MDMA survey of 109 medical device executives conducted during November and December 2014 found that 72 percent of companies had slowed or halted job creation as a result of the tax. Survey respondents said that if the tax were repealed, 85 percent would hire new employees in the U.S.
  • Further, 80 percent of respondents indicated that they would increase R&D investments following a repeal.

On the other hand, a 2015 Emergo Group survey found that most U.S. companies did not make major changes in 2014 in response to the levy, suggesting that the tax has become part of daily business.  
 
Based upon responses from 685 medical device executives in the U.S., the Emergo Group survey found that:
  • 57% of companies made no significant changes
  • 29% raised prices
  • 18% invested less in R&D
  • 14% reduced staff
  • 8% lowered production costs without reducing staff

The medical device tax was expected to provide the government with varying revenues of $20 billion to $30 billion between 2013 and 2019—numbers that did not pan out. In the first half of 2013 a collection of $913.4 million was reported, prompting the Treasury Inspector General for Tax Administration to issue a report on needed IRS improvements to ensure accurate reporting and payment of the tax. The report found discrepancies of $117.8 million in overstated and understated taxes for that period. 
 
In the next two years, companies with a higher percentage of U.S. sales stand to benefit the most from the suspension. Of the 17 largest orthopaedic companies, those with a higher proportion of U.S. sales include Globus Medical, Integra LifeSciences, Medtronic, NuVasive, Orthofix, Stryker and Wright Medical.
 
A two-year suspension of the tax is a positive step that offers potential for future delays or an overall repeal. Still, delay and not repeal leaves companies with uncertainty. Concerns over the device tax have seemed to decrease since its implementation in 2013, but everyone remembers the frenzied climate when the tax was enacted in 2010 and levied in January 2013. Without a full repeal, companies may remain limited in their strategic actions.  
 
December 11, 2015 | NuVasive Takes Steps toward Insourcing Goal with Acquisition of New Site
NuVasive advanced its effort to move 100 percent of its manufacturing in-house with the acquisition of a site in West Carrollton, Ohio. 
 
NuVasive executives announced the insourcing goal in August, stating that vertical integration of its manufacturing offers the greatest opportunity to hit NuVasive’s goal of a 20 percent operating margin ratio as it drives to $1 billion in revenue. The company expects 400 bps of gross margin improvement with ~100 bps improvements in 2016 and ~150 bps in both 2018 and 2019, according to Wells Fargo analysts.*
 
NuVasive plans to invest ~$45 million over the next 24 months to build out and equip the 160,000-square-foot facility, which is located ~30 miles from the site acquired through a $4.5 million purchase of ANC in 2013.
 
Commercial scale production is expected to begin by the end of 2016. When at full scale, the facility is expected to employ 300 full-time staff and house approximately 100 CNC machine tools, CMM inspection equipment and a clean room.  
 
NuVasive competitors Alphatec Spine and Globus Medical also recently announced strategic manufacturing initiatives. 
 
 
*100 bps = 1%
We realize that basis point (bps) is rarely found in our reporting. Analysts use it as a more stable number to demonstrate percentage growth/decline, and here we found the context to be appropriate.

 

November 30, 2015 | Trauma Market Trends Focus on New Solutions, Shifts in Care Delivery
Trends in the trauma market, the third largest segment in the orthopaedic industry, center on new technologies and treatment methods such as minimally invasive techniques and the use of orthobiologics. Advancements in product offerings aside, shifts in the healthcare delivery system, characterized by changes in decision-making power at healthcare facilities and the growing popularity of outpatient care, also impact this segment. 
 
To take a closer look at these trends, ORTHOWORLD asked several device manufacturers: What trends do you see in the trauma market?
 
Manny Avila, President & CEO, IlluminOss: What I hear from surgeons and what we’re trying to fulfill is the need to be more minimally invasive with procedures for patients, and find a way to minimize the additional time that patients are spending in the hospital after surgery. They [surgeons] talk about wanting new materials and innovation to support that. They’re always looking at decreasing the cost of technology and improving patient outcomes. 
 
Eric J. Dickson, Global Director of Business Development, Extremities, Tyber Medical: We continue to see advancement in anatomical implants (3D manufacturing) that can really -- in high-energy trauma – put the patient back to their exact anatomical figure for alignment. I see several companies coming out with more radiolucent and expanding implants, and distal targeting systems for nails – everybody’s trying to perfect that, to advance in the ease of use and care for the patient and the surgeon. I don’t believe I’ve seen robotics as of yet, but I think that will be coming in the future, like nailing systems. 
 
EJ Duffy, Founder & CEO, Impact Medical: One of the biggest trends right now is that insurance companies are moving to bundled reimbursements. This changing marketplace is helping to assist doctors/hospitals and surgery centers to hold their vendors and suppliers more economically accountable, ultimately benefiting the patients and their co-pays. This supersedes all the other reimbursement trends that we are seeing at this time. 
 
Another large trend that we are witnessing is the number of surgeries performed at ASCs. Doctors are moving away from hospitals because of the reduction in annual patient reimbursement. Doctors have to perform more surgeries at an ASC to keep existing profit margins. Ten years ago, you would never have heard of having a total joint replacement or spinal procedure at a surgery center.
 
Amir Matityahu, M.D., Founder & CEO, Epix Orthopaedic: The trends we’re seeing in hardware are implants that are giving doctors more options to do their jobs better. Some people are playing with material changes, like carbon fiber versus titanium, and different kinds of configurations of screws. 
 
One of the biggest issues is that, some of the big companies are not innovating. They’re just making incremental changes and the risk is upon the smaller companies and start-ups to create innovative changes. If it pans out, the bigger companies are either investing in or buying them. 
 
The major unmet needs are actually helping the doctor do his job, in straightening the fracture before insertion of implants. What companies do is they give you an implant and some reduction tools, but they’re not addressing the hardest part of the surgery, which is, How do I straighten out the bone so I can put the implant on an anatomically straightened bone? Companies are not focused on that because that doesn’t sell. They’re selling an implant, which helps the bottom line. If they make the reduction tool to straighten out the bone, that’s part of the instrument set, and it costs money.
 
Read the full article at ORTHOPRENEURpub.com.
November 05, 2015 | Market Shifts Facilitate Same-Day Joint Replacement

As demands for joint replacement surgery rise due to an aging population, consumers seek out less invasive and less costly treatments, and hospitals and payors adopt risk-based models like bundled payments, same-day joint replacement surgery stands to experience further growth.

Though traditional joint replacement surgery is known for its effectiveness, the following data suggests that same-day or outpatient joint replacement surgery is on the rise.

A Duke University study showed that from 2007 to 2011, outpatient total knee replacements increased by nearly 20 percent, total hip replacement by almost 40 percent and partial knee replacement almost 70 percent, according to Keith Berend, M.D., an orthopaedic joint replacement surgeon at Joint Implant Surgeons, Inc. in Columbus, Ohio.

The strongest data is currently available for unicompartmental knee replacement which, “given its minimal blood loss and maintenance of intact ligaments, lends itself perfectly to outpatient surgery,” says John Barrington, M.D., an orthopaedic joint replacement surgeon at Plano Orthopedic Sports Medicine and Spine Center in Plano, Texas.

While same-day joint replacement procedures are indeed studied at length and alluded to frequently in the patient information found on the web sites of numerous clinics, data isn’t readily available that indicates the proportion of all total hip and total knee replacements that are presently performed on an outpatient basis, nationwide.

John Wang, M.D., an orthopaedic joint replacement surgeon at Atlantis Orthopaedics in Florida, expects the number of outpatient joint surgeries to rise as the healthcare system addresses a higher demand for joint replacements and discovers how to make these surgeries more effective from outcomes and cost analysis.

“There’s only a certain amount of money we can spend on joint replacement as a nation, so surgeons and scientists have been trying different ways to improve this surgery,” Wang says. “The potential financial implications will come in the form of decreasing overall cost into the system. If you could shorten length of stay down to eight hours, that would obviously cost the insurance companies and/or Medicare less money than if a patient stayed for a week. From that perspective, there are huge implications for decreasing costs in the face of this increased demand for joint replacement over the next decade or two.”

Patients best suited for outpatient joint replacement are typically healthier, but don’t have to be in perfect health, Berend says.

“They have to have manageable medical conditions that can be optimized to reduce their risk,” he says. “It doesn’t mean they have to be young, because we do a huge number of outpatient partial knee replacements even in elderly folks.”

“In my experience only ten to 20 percent of the patients I see are actually good candidates for these," Wang says. "Not because of orthopaedic reasons, but because of medical reasons. Particularly if you have breathing issues or obstructive sleep apnea, for example, it may be harder to get the patient out from anesthesia. Or, if they have cardiac issues or other more serious medical issues indicating that this patient may need closer monitoring, then we’ll just admit them to the hospital. If it goes perfectly, it’s really a huge boon for the patients.”
 

Read this article in its entirety on ORTHOPRENEUR.

October 20, 2015 | LDR's Christophe Lavigne talks Mobi-C, MIVo and more

During NASS 2015, LDR announced that FDA approved an update to labeling for the Mobi-C® cervical disc to include 5-year clinical results. The updated data remains consistent with the previous findings at 24 months—specifically, that at 60-month follow-up, Mobi-C is statistically non-inferior in overall study success for 1-level use, and statistically superior in overall study success compared to ACDF for 2-level use.

This update is critical because, in the words of Christophe Lavigne, LDR President and CEO, “In addition to bolstering the continued support from surgeons, the statistical superiority in overall success of Mobi-C to ACDF at two levels will serve as additional evidence to further the confidence of insurance payers in cervical disc replacement. This is a win for all patients indicated for the treatment.”

Earlier in October, LDR reported preliminary 3Q15 revenue of $39.3 million, +14% from 3Q14. Exclusive Cervical Technologies revenue of $27.5MM grew +25% year over year. Cervical product revenue continues to garner principal support from sales of Mobi-C. 

Mobi-C is a cobalt chromium alloy and polyethylene mobile-bearing prosthesis designed as a bone-sparing, cervical intervertebral disc replacement, and is the only FDA-approved disc for 1-level and 2-level use.

In response to BONEZONE’s query on LDR’s future focus, Mr. Lavigne expanded upon the lumbar region:

“On the lumbar side, we do not believe the future of degenerative spine fusion surgery will rely on pedicle screw fixation. We view pedicle screws as the last fixation option most appropriate for advanced pathology, significant deformity or revision.

“Our vision for the evolution of 360° lumbar spine fusion surgery is to combine a stable interbody construct with a posterior MIS approach that avoids pedicle screws and rods. This can maximize the opportunity for clinical success while preserving the pedicles for more aggressive intervention that might be necessary in the future. One way to think about this approach is what we are now calling Minimal Implant Volume Surgery, or MIVo™ Surgery.

“Ultimately, this approach to lumbar instrumentation may result in a 45 percent to 60 percent reduction in the volume of implant material used to stabilize one level of the lumbar spine, while still providing adequate stability to both the anterior and posterior spinal columns and avoiding use of the vertebral pedicles.”

Mr. Lavigne offers an outlook on the future in BONEZONE’s Zoning In column.

September 24, 2015 | Ortho Kinematics Expands Leadership Team

Ortho Kinematics‚ Inc. (OKI), a privately-held healthcare diagnostics company focused on spine imaging informatics,  announced the appointment of Tom Anderson as Vice President of Sales and Chris White as Vice President of Finance. With these hires, OKI has in place the management team required to support its current national-scale commercialization efforts. 

Earlier in the year, the company completed a limited-scale launch of its flagship product, the VMA. The VMA is a diagnostic test for the assessment of spinal motion, which includes instability in the cervical and lumbar spine.  Spinal instability is an important consideration for physicians when evaluating candidates for potential spine surgery or spine pain management injections.  The VMA has been shown in studies to increase the sensitivity in detecting spinal motion, including instability, with no decrease in specificity relative to the current standard test.

Mr. Anderson joins OKI with 25 years of experience in medical device sales and sales leadership. Mr. Anderson has held sales leadership positions at a variety of spine surgery-focused companies, ranging from start-ups such as Kyphon, to large multi-nationals, such as Medtronic Spinal & Biologics, where Tom was Regional Vice President of Sales.  Along with Mr. Anderson, OKI has also appointed three highly-experienced Area Vice Presidents of Sales: Mike Isaacson, Jim Courville and Jeff VanRaaphorst.

Mr. White, CPA, joins OKI with over 15 years of experience in accounting and finance for public companies such as BioCryst Pharmaceuticals, large institutional investment funds such as Harbert Management Corp., as well as several start-up companies.

“Tom Anderson has a track record of success, and the right mix of skills, experience and grit to build and lead our sales organization,” notes Paul Gunnoe, CEO,  adding, “With the addition of Tom, his sales team, and an experienced VP of finance, we are well on our way to becoming the global leader in spine diagnostics.”

September 23, 2015 | TranS1 Names John Miller New Vice President of Sales

TranS1, a spinal device company, has restructured under new ownership by Quandary Medical, evidenced by the recent announcement of John Miller as the new Vice President of Sales.

Miller brings more than 18 years of sales and marketing experience with medical and orthopaedic device companies to TranS1. Prior to this position, he served as Vice President of Sales at SpineFrontier in Boston and Sales Director at Baxano Surgical in Raleigh-Durham, N.C.

Miller will lead sales efforts for TranS1’s primary product, the AxiaLIF interbody fusion technology, as well as future product offerings.

According to a company press release, AxiaLIF has been used in over 14,000 procedures in the U.S. and has been featured in close to 100 peer-reviewed publications establishing the product’s safety, efficacy and biomechanics.

The company has also brought on new R&D, sales and education professionals to drive sales and train its surgeon customers.
 

More spine news:
NASS Preview: Products and Companies to Watch
NASS Preview: A Guide to the Recently-merged in Spine

September 11, 2015 | Leadership Changes at Globus Medical, Medicrea, MicroPort Orthopedics

Globus Medical announced three internal personnel changes:

  • Dave Demski, formerly President and Chief Operating Officer, to become Group President, Emerging Technologies
  • Anthony Williams, formerly Senior Vice President of Business Development and General Counsel, is appointed President
  • Brett Murphy, former Executive Vice President of US Sales, is now Group President, Commercial Operations

 

Mr. Demski will apply his interest in business-building to Globus’ long-term strategic initiatives in robotics, trauma and related opportunities while continuing to liaise with surgeon and hospital customers.

Mr. Williams’ experience at Globus includes several strategic acquisitions, having risen through various roles in business development and general counsel since the company’s inception in 2003.

Prior to his new position, Mr. Murphy’s roles at Globus included Vice President, US Sales West and Area Director, South. Previously, he served in sales and management at Synthes and Smith & Nephew Richards.

Medicrea recently announced that Greg Rhinehart, formerly Vice President of U.S. Sales Central for Globus, has now joined on to lead sales at Medicrea USA.

At MicroPort Orthopedics (MPO), Aurelio Sahagun is appointed President while Ted Davis has stepped down from the position of Chief Executive Officer.

Sahagun’s previous titles at MPO include Chief Operations Officer and Vice President International, as well as various operations, sales and finance leadership positions for the EMEA region at Wright Medical. Before Wright Medical, Mr. Sahagun served as senior-level financial support for Medtronic’s spine business in Europe. 

September 10, 2015 | OIG Monitors Links Between Physician-Owned Hospitals and Physician-Owned Spine Distributors
A report released by the U.S. Office of Inspector General (OIG) found limited transparency with regard to ownership information of physician-owned distributors (PODs) and physician-owned hospitals.
 
The OIG used publicly available information (websites) and data from the Centers for Medicare & Medicaid Services (CMS) to attempt to determine whether a physician had an ownership interest in both a hospital and a POD that sold spinal devices to that hospital. The research focused on the ownership of 12 PODs from which 12 physician-owned hospitals reported purchasing spinal devices. 
 
The OIG was able to identify one physician who owned a POD that supplied devices to a hospital in which the physician had ownership interest. The report noted the possibility of additional physicians with identical relationships that could not be detected using the outlined information. 
 
The report stated that the limited information raises transparency concerns because:
  1. Ownership information may have implications for patient safety and quality of care
  2. PODs face criticism that physician owners could make clinical decisions that lead to unnecessary surgery in order to boost financial gain
The OIG made no future recommendations, but said that it will continue to monitor POD activity through CMS’ Sunshine Act database.
 
The report follows an October 2013 report on the prevalence and use of spinal devices supplied by PODs.
 
August 31, 2015 | ConforMIS Initiates Voluntary Recall of Certain PSI for iUni, iDuo and iTotal Knee Systems

ConforMIS (CFMS) initiated a voluntary recall of certain patient-specific instrumentation for iUni, iDuo, iTotal CR and iTotal PS knee systems following three complaints of moisture on the instrumentation. Approximately 950 patient-specific instrumentation sets are affected, of which ~650 sets were used in knee procedures and ~300 sets shipped but not yet used. CFMS does not believe that customized knee implants included with the sets were affected, and has not received reports of related adverse events, to date.

The recalled instrumentation appears to have held excess water before undergoing ethylene oxide sterilization and, as a result, may contain small amounts of ethylene glycol residue. ConforMIS has temporarily suspended use of the ethylene oxide sterilization process, and CFMS will use a validated, alternative sterilization process (hydrogen peroxide-based, per Canaccord Genuity analysts).

Stats:

  • ~ 950 patient-specific instrumentation sets affected
  •  ~650 sets used in knee implant procedures, ~300 sets shipped but not yet used
  • Affected sets manufactured and distributed from the company’s new manufacturing facility between July 18, 2015 and August 28, 2015

 

Manufacturing is likely to be substantially reduced in September (possibly into October) in light of investigation and resolution activities. Wells Fargo analysts cite CFMS’ expectation to secure a solution within this timeframe, with a potential resolution by year-end.

Combined, the effect of recalled products that were shipped but not used, lower production capacity and potential commercial disruption will impact sales; CFMS is revising 2015 revenue to a range of $64 million to $66 million (up 39% to 43% in constant currency)—a reduction of $8 million from previous guidance.

In early 3Q15, ConforMIS closed its IPO of 10,350,000 shares of common stock at $15/share (before underwriting discounts), and in mid-3Q, the company announced that interim analysis of 295 total knee replacement patients at seven U.S. centers indicated that patients with iTotal CR (cruciate-retaining) devices were more likely to have an excellent or good objective Knee Society Score and walked statistically significantly faster than patients with standard, off-the-shelf total knees.

Sources: ConforMIS, analyst notes

August 19, 2015 | FDA Extends UDI Deadlines Following Database Security Issues
FDA has extended the upcoming deadline for compliance with labeling and data submission to the Global Unique Device Identification Database (GUDID) due to the Agency pulling the database offline after an undisclosed security vulnerability was detected. 
 
Manufacturers of implantable, life sustaining and life supporting devices, as well as Class III devices that received extensions expiring between August 7 and the original September 24 deadline, now have until October 24 to submit data. 
 
In May, FDA launched the database that will house submitted data from medical device companies. The database allows the public to track medical devices from manufacturing through the supply chain to patient use.
 
UDI compliance best practices and the remaining deadlines can be found in the article, “UDI Implementation: Your Next Steps.”