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Marty Altshuler and Rick Henson were given an opportunity to acquire spinal products and transition from a medical device distributorship to a successful, full line implant manufacturing company. There was only one option: they made the deal and founded ChoiceSpine back in 2006. Since then, the co-presidents have built a comprehensive spinal hardware and biologics portfolio. ChoiceSpine sells in five countries and has nearly 70 employees.
“We look back at it every year and say, ‘How did we do that?’ It’s about keeping your focus on doing what you intend to do while also doing what you can afford to do,” said Mr. Altshuler, an ORTHOWORLD Member since 2007.
We sat down with Mr. Altshuler at this year’s North American Spine Society meeting to ask about the lessons he’s learned from more than three decades in the medical device industry, including the build-out of ChoiceSpine’s product lines and selling the company to a private equity firm.
What was the impetus for founding ChoiceSpine?
Mr. Altshuler: Rick and I started as spinal implant distributors in East Tennessee and came to the realization one day that we did not want to be middlemen anymore. The surgeons we were working with had ideas and wanted new technology for their patients. With that being said, we had the option to acquire one of the companies that we were distributing and that was the beginning of ChoiceSpine as a developer and manufacturer in the industry.
Once we began, our first point of customer contact came from speaking to big distributors. We felt that we could carry the message of what we wanted to do and develop products that surgeons wanted. We felt that we could better identify with them, since we used to be in their shoes. Our experience in the operating room and building relationships with surgeons, we found, really resonated with attracting distributors.
You have built thorough hardware and biologics product lines. What have been some of the opportunities and challenges in expanding your offering?
Mr. Altshuler: Let me first start with biologics. For 12 years, we operated without them. We wanted to provide hardware, and our distributors usually had a relationship with a separate biologics company. Over the years we realized that we were not providing full service to our distributor and surgeon partners by not offering a full biologics portfolio to complement our implants.
We got serious about finding the right products and the right person to run the biologics division. We were fortunate to bring into our leadership someone who had been in biologics for many years.
Our goal was not to come out with just a handful of products to take care of 30% or 40% of the surgeons’ needs. We wanted a portfolio that could address the majority of their needs, and position ChoiceSpine as a sole source provider of spinal solutions in the surgeons’ operating room. One distributor, one manufacturer, providing everything the surgeon would need for their patients.
The hardware side was a process. You can’t build everything overnight, and we knew that we had to grow our portfolio one step at a time. We started with acquired products that were already FDA-cleared. Spinal implants are expensive to make, and we didn’t have private equity or outside investment at the time. Our commitment was to build in a timely and fiscally responsible way.
While we slowly built our portfolio, it was a challenge because it’s hard to go into a meeting with a surgeon or step into an operating room with one-third or one-half of the product offering that the surgeon is going to need.
The challenge was staying confident, staying the course to build out our portfolio. Today, we have about a 90%-plus complete offering for spine. We are a smaller company, yet with our innovation and speed to market, we compete with the larger and greater resourced companies, product-for-product, every day. We did it at our speed based on the revenues that we could afford internally. It took a lot of hard work and commitment to organic growth.
What has been a major change in the spine industry since ChoiceSpine was founded?
Mr. Altshuler: One of the biggest changes has been hospital access. It’s complicated. Even surgeons who really like your product and have been using it for years, who are trying to get their hospital to go ahead and satisfy what that surgeon wants, is difficult. That’s the change from a hospital standpoint. We are committed to providing resources to keeping hospital and GPO access a top priority.
From a product standpoint, I think technology is continuing to develop. Materials have gone from PEEK to titanium to 3D printing and additive technologies. Navigation, robotics and less invasive surgery continue to be a growing sector of our marketplace.
Looking at your recent product launches, ChoiceSpine has really bought into additive. Right?
Mr. Altshuler: We are producing a lot of additive technologies. The creativity and innovative aspects to additive manufacturing are a large trend in our industry right now. But, we have all options. We have traditional PEEK, which has been around and will continue to be around for many years. We have titanium-coated PEEK. We have machined titanium. We have 3D-printed titanium. One of the challenges is that to have significance in our space, you have to have multiple options. You have to have as much of an offering as your pocketbook will allow you to have.
Your pocketbook comment is a good segue into the fact that Altus Capital acquired you in November 2018. Can you share how that relationship has helped ChoiceSpine?
Mr. Altshuler: It has helped us put good, accountable, financial guardrails around our business. Altus is building financial stability for us and helping us plan for the future. How are we going to scale and grow the company over the next five years? We have a five-year plan that involves growing organically for some new product introductions. We’ve introduced four new products this year alone, and they’re doing really well so far. When we introduce a new product system, it goes through an alpha launch. Once we know we’ve got all the bugs worked out, it goes to full market launch. Usually it takes 12 to 15 months before you see that new product make significant headway in the marketplace.
Having financial backing from Altus that allows us to grow and scale to be a larger company has been a great benefit.
M&A remains steady in orthopedics. What lessons did you learn through the selling process that you can share with other members of industry?
Mr. Altshuler: You have to question whether whom you are acquiring fits in with the current culture of your existing company. If we are bringing in a new company, and we’re looking at a couple of opportunities now, we look at how the culture of the two workforces are going to work together.
Culture even came into play with Altus. Several private equity firms were interested in us, and out of the dozen or so that we interviewed, they were the ones with which we as a leadership team felt a cultural connection.
Make sure that the product fits in your portfolio. We look for things that we don’t have that complement our existing business. You want to make sure that the product has a future, too. You know that if something doesn’t have a long runway of product continuity, then it doesn’t make sense to acquire it.
Where do you see ChoiceSpine in five years?
Mr. Altshuler: The five-year plan is a continued strategy to reach new distributors and surgeons. For instance, we have a strategy for the ASC market. It could be product; it could be supply delivery. The way ASCs receive, order and use the product is going to be important. ASCs are usually privately owned by surgeons, and they’re more mindful of cost and how much time is spent for processing. You have to assess all the factors, not just the product, but the speed of being able to perform a procedure, and how the product is delivered.
The ASC market is a priority for the next five years. We plan to continue to grow our biologics offering as well. We believe that biologics and regenerative medicine will continue to be a fast-growing sector in our market.
Our strategy also includes continuing to grow in Europe. With the MDR regulation taking effect in Europe we’re being cautious, but we’re still moving ahead to figure out which ex-U.S. markets make the most sense for us.
What do you think are the attributes of a successful leader?
Mr. Altshuler: Integrity. If you don’t have integrity, then what do you have? Trustworthiness. The values that you live your life by, you want your employees to exhibit.
A principle that we follow and talk about every week is “PART B.” “P” stands for Positive Attitude. “A” is Accountability. “R” is Responsiveness. “T” is Trustworthiness. And finally, “B” is to Be a Team Player. We are all in this together. Whether you’re in receiving, logistics, quality or sales and marketing, we all have to exhibit PART B.
What advice do you have for a young person entering the spine industry?
Mr. Altshuler: Be ready to learn every day. I’m still learning every day. You have to be willing to listen, learn, study, and read. I’ve been in the medical device sector my whole career—36 years. Orthopedics especially; there’s just so much opportunity. I tell my kids the same thing. Right when you think you know it all, you’re going to find out you know nothing.
Carolyn LaWell is ORTHOWORLD’s Chief Content Officer.
Marty Altshuler and Rick Henson were given an opportunity to acquire spinal products and transition from a medical device distributorship to a successful, full line implant manufacturing company. There was only one option: they made the deal and founded ChoiceSpine back in 2006. Since then, the co-presidents have built a comprehensive spinal...
Marty Altshuler and Rick Henson were given an opportunity to acquire spinal products and transition from a medical device distributorship to a successful, full line implant manufacturing company. There was only one option: they made the deal and founded ChoiceSpine back in 2006. Since then, the co-presidents have built a comprehensive spinal hardware and biologics portfolio. ChoiceSpine sells in five countries and has nearly 70 employees.
“We look back at it every year and say, ‘How did we do that?’ It’s about keeping your focus on doing what you intend to do while also doing what you can afford to do,” said Mr. Altshuler, an ORTHOWORLD Member since 2007.
We sat down with Mr. Altshuler at this year’s North American Spine Society meeting to ask about the lessons he’s learned from more than three decades in the medical device industry, including the build-out of ChoiceSpine’s product lines and selling the company to a private equity firm.
What was the impetus for founding ChoiceSpine?
Mr. Altshuler: Rick and I started as spinal implant distributors in East Tennessee and came to the realization one day that we did not want to be middlemen anymore. The surgeons we were working with had ideas and wanted new technology for their patients. With that being said, we had the option to acquire one of the companies that we were distributing and that was the beginning of ChoiceSpine as a developer and manufacturer in the industry.
Once we began, our first point of customer contact came from speaking to big distributors. We felt that we could carry the message of what we wanted to do and develop products that surgeons wanted. We felt that we could better identify with them, since we used to be in their shoes. Our experience in the operating room and building relationships with surgeons, we found, really resonated with attracting distributors.
You have built thorough hardware and biologics product lines. What have been some of the opportunities and challenges in expanding your offering?
Mr. Altshuler: Let me first start with biologics. For 12 years, we operated without them. We wanted to provide hardware, and our distributors usually had a relationship with a separate biologics company. Over the years we realized that we were not providing full service to our distributor and surgeon partners by not offering a full biologics portfolio to complement our implants.
We got serious about finding the right products and the right person to run the biologics division. We were fortunate to bring into our leadership someone who had been in biologics for many years.
Our goal was not to come out with just a handful of products to take care of 30% or 40% of the surgeons’ needs. We wanted a portfolio that could address the majority of their needs, and position ChoiceSpine as a sole source provider of spinal solutions in the surgeons’ operating room. One distributor, one manufacturer, providing everything the surgeon would need for their patients.
The hardware side was a process. You can’t build everything overnight, and we knew that we had to grow our portfolio one step at a time. We started with acquired products that were already FDA-cleared. Spinal implants are expensive to make, and we didn’t have private equity or outside investment at the time. Our commitment was to build in a timely and fiscally responsible way.
While we slowly built our portfolio, it was a challenge because it’s hard to go into a meeting with a surgeon or step into an operating room with one-third or one-half of the product offering that the surgeon is going to need.
The challenge was staying confident, staying the course to build out our portfolio. Today, we have about a 90%-plus complete offering for spine. We are a smaller company, yet with our innovation and speed to market, we compete with the larger and greater resourced companies, product-for-product, every day. We did it at our speed based on the revenues that we could afford internally. It took a lot of hard work and commitment to organic growth.
What has been a major change in the spine industry since ChoiceSpine was founded?
Mr. Altshuler: One of the biggest changes has been hospital access. It’s complicated. Even surgeons who really like your product and have been using it for years, who are trying to get their hospital to go ahead and satisfy what that surgeon wants, is difficult. That’s the change from a hospital standpoint. We are committed to providing resources to keeping hospital and GPO access a top priority.
From a product standpoint, I think technology is continuing to develop. Materials have gone from PEEK to titanium to 3D printing and additive technologies. Navigation, robotics and less invasive surgery continue to be a growing sector of our marketplace.
Looking at your recent product launches, ChoiceSpine has really bought into additive. Right?
Mr. Altshuler: We are producing a lot of additive technologies. The creativity and innovative aspects to additive manufacturing are a large trend in our industry right now. But, we have all options. We have traditional PEEK, which has been around and will continue to be around for many years. We have titanium-coated PEEK. We have machined titanium. We have 3D-printed titanium. One of the challenges is that to have significance in our space, you have to have multiple options. You have to have as much of an offering as your pocketbook will allow you to have.
Your pocketbook comment is a good segue into the fact that Altus Capital acquired you in November 2018. Can you share how that relationship has helped ChoiceSpine?
Mr. Altshuler: It has helped us put good, accountable, financial guardrails around our business. Altus is building financial stability for us and helping us plan for the future. How are we going to scale and grow the company over the next five years? We have a five-year plan that involves growing organically for some new product introductions. We’ve introduced four new products this year alone, and they’re doing really well so far. When we introduce a new product system, it goes through an alpha launch. Once we know we’ve got all the bugs worked out, it goes to full market launch. Usually it takes 12 to 15 months before you see that new product make significant headway in the marketplace.
Having financial backing from Altus that allows us to grow and scale to be a larger company has been a great benefit.
M&A remains steady in orthopedics. What lessons did you learn through the selling process that you can share with other members of industry?
Mr. Altshuler: You have to question whether whom you are acquiring fits in with the current culture of your existing company. If we are bringing in a new company, and we’re looking at a couple of opportunities now, we look at how the culture of the two workforces are going to work together.
Culture even came into play with Altus. Several private equity firms were interested in us, and out of the dozen or so that we interviewed, they were the ones with which we as a leadership team felt a cultural connection.
Make sure that the product fits in your portfolio. We look for things that we don’t have that complement our existing business. You want to make sure that the product has a future, too. You know that if something doesn’t have a long runway of product continuity, then it doesn’t make sense to acquire it.
Where do you see ChoiceSpine in five years?
Mr. Altshuler: The five-year plan is a continued strategy to reach new distributors and surgeons. For instance, we have a strategy for the ASC market. It could be product; it could be supply delivery. The way ASCs receive, order and use the product is going to be important. ASCs are usually privately owned by surgeons, and they’re more mindful of cost and how much time is spent for processing. You have to assess all the factors, not just the product, but the speed of being able to perform a procedure, and how the product is delivered.
The ASC market is a priority for the next five years. We plan to continue to grow our biologics offering as well. We believe that biologics and regenerative medicine will continue to be a fast-growing sector in our market.
Our strategy also includes continuing to grow in Europe. With the MDR regulation taking effect in Europe we’re being cautious, but we’re still moving ahead to figure out which ex-U.S. markets make the most sense for us.
What do you think are the attributes of a successful leader?
Mr. Altshuler: Integrity. If you don’t have integrity, then what do you have? Trustworthiness. The values that you live your life by, you want your employees to exhibit.
A principle that we follow and talk about every week is “PART B.” “P” stands for Positive Attitude. “A” is Accountability. “R” is Responsiveness. “T” is Trustworthiness. And finally, “B” is to Be a Team Player. We are all in this together. Whether you’re in receiving, logistics, quality or sales and marketing, we all have to exhibit PART B.
What advice do you have for a young person entering the spine industry?
Mr. Altshuler: Be ready to learn every day. I’m still learning every day. You have to be willing to listen, learn, study, and read. I’ve been in the medical device sector my whole career—36 years. Orthopedics especially; there’s just so much opportunity. I tell my kids the same thing. Right when you think you know it all, you’re going to find out you know nothing.
Carolyn LaWell is ORTHOWORLD’s Chief Content Officer.
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Carolyn LaWell is ORTHOWORLD's Chief Content Officer. She joined ORTHOWORLD in 2012 to oversee its editorial and industry education. She previously served in editor roles at B2B magazines and newspapers.
