NuVasive Inc. has spent some big bucks to make a bigger splash in operating rooms. The San Diego, Calif.-based spinal device maker shelled out $40 million in cash and another $40 million in stock earlier this fall to acquire Impulse Monitoring Inc., a provider of intra-operative monitoring (IOM) services to hospitals and surgical centers.
Impulse Monitoring’s neurophysiologists work as members of the surgical team to check for signs of “neurological compromise and identification of functional neural structures,” a news release announcing the deal stated. The Columbia, Md.-based company provides the service for cardiology, ear-nose-throat, brain, general orthopedic and spine procedures, though spinal surgeries account for 80 percent of its case volume.
The acquisition is designed to augment NuVasive’s NeuroVision nerve monitoring system, which is used with its XLIF lateral lumbar interbody fusion system. Executives claim the move will boost XLIF penetration and market share by increasing the number of neurophysiologists who can set up and use the NeuroVision system, a product used to help spine surgeons monitor the activity of key nerves in the body and avoid nerve damage during procedures that use NuVasive surgical devices and implants.
Once the acquisition is complete, NuVasive will have a formidable army of more than 450 professionals versed in the NeuroVision technology (150 neurophysiologists employed by Impulse Monitoring and more than 300 spine specialists of its own, according to NuVasive data). A reluctance among doctors and nurses to set up the NeuroVision equipment has prevented its more widespread use in hospitals, NuVasive bigwigs claim.
“Surgeons don’t like to do it. Right now, we have 300 sales representatives placing NeuroVision and that’s going to continue,” NuVasive Chairman and CEO Alex Lukianov said during a late September conference call with stock analysts. “We intend to be the hospital’s go-to provider for neuro-spine monitoring.”
That goal may not be too difficult to achieve: NuVasive executives estimate the IOM market to be worth about $800million and use of the monitoring service to rise 15 percent annually for the next
several years. Such potential provides the company with a solid new revenue stream and could help it expand its presence in the IOM sector into a “nationwide footprint.”
“We are particularly excited about the increased XLIF penetration opportunities that will be facilitated by this transaction. This acquisition will augment our leadership position within neuromonitoring by enabling NuVasive to offer additional services, including operating room clinical support of neuromonitoring and professional neuromonitoring oversight,” Lukianov noted. “The service will expand our relationships with our surgeon and hospital customers and foster incremental revenue opportunities. We are familiar with this market through an acquisition of a much smaller regional IOM service provider last year. The operational experience that we gained running that business, along with its results thus far, further validated ourdesire to expand our presence in thisrapidly growing market.”
The desire to expand NuVasive’s presence in the market certainly is clear from Lukianov’s carefully prepared remarks. But analysts wonder whether the Impulse deal is more indicative of skepticism among management of the company’s ability to expand the use of the NeuroVision monitoring system without outside help.
“It looks as though maybe you’re running out of room to drive deeper with NeuroVision,” Benjamin Andrew, an analyst with Chicago, Ill.-based investment firm William Blair & Co. LLC, told The San Diego Union Tribune.
Regardless of the motivation, the acquisition is expected to have a minimal impact on NuVasive’s finances in the near future. The deal could add about $8 million to the company’s fourth-quarter revenue, though Impulse Monitoring’s profit margin isexpected to fall below that of NuVasive. The company reported $133 million in third-quarter revenue, a 10.5 percent increase compared with the same period last year.
Titan Spine Launches Interbody Fusion Device
Titan Spine’s newest product has hit the market. The Mequon, Wis.-based company received 510(k) clearance from the U.S. Food and Drug Administration to sell its Endoskeletal TAS system for anterior
lumbar interbody fusion with integrated fixation screws.
The system incorporates macro-, micro- and nano-surface technology textures that already are available in the company’s Endo TA ALIF device. It also includes three integrated grit-blasted screws that allow 10 degrees of medial/lateral or anterior/posterior angulation. The Endoskeleton TAS sits on the strongest portion of the endplate, which provides excellent resistance to subsidence, according to a brochure of the product. The device also maintains hoop stress of the inferior and superior endplates, allowing the transfer of stress through the apophysis.
Other features of Titan Spine’s latest Endoskeleton device include a dual acid-etched titanium surface for better bone bonding, a large open area for bone graft (large open windows provide for ideal
radiographic visualization, according to the company) and a smooth leading posterior edge that allows the device—available in 16 sizes—to easily be inserted into theaffected area.
These kinds of characteristics have generated praise from the surgeons who have used the Endoskeleton. “I was impressed how the roughened surface of the implant prevented the device from moving during screw insertion,” Fred Geisler, M.D., neurosurgeon with The Chicago Back Institute in Chicago, Ill., said in a news release. “The combination of immediate stabilization and the osteoinductive properties of the implant’s micro and nano textures represent a significant advance in spine surgery.”
Robert Henderson, M.D., an orthopedic surgeon in Dallas, Texas, called theEndoskeleton surgical technique simple and straightforward, and said the supplemental fixation feature gives doctors an ideal option in cases where supplemental posterior stabilization should be avoided.
Titan Spine President Kevin Gemas, meanwhile, believes the new Endoskeleton product will enable the privately held firm to increase its market share in the interbody implant device arena. “The addition of the Endoskeleton TAS to our product line allows us to address approximately 90 percent of the interbody market that is approaching $1 billion in domestic annual sales,” he noted. “We are well-positioned to continue to increase our market share and meet the growing need of spine surgeons looking for interbody implants that create a superior osteogenic environment for their patients.”
Founded in 2006, Titan Spine designs and manufactures proprietary interbody fusion devices for the spine. Its other products include the Endoskeleton TA, Endoskeleton TC, Endoskeleton TO and Endoskeleton TT.
New Technology Provides New Look at Knee Implants
Implant manufacturers often wish they could peek inside the body to determine the efficacy of new product designs.
Their wishes might soon come true—sort of—thanks to new innovation developed by Advanced Mechanical Technology Inc. (AMTI), a Watertown, Mass., manufacturer of multi-axis biomedical testing machines and multi-axis force measurement instruments. The company has patented a technology called virtual soft tissue (VST) control, a detailed and programmable computer software system used in its knee wear simulators. VST, according to the firm, eliminates the need for mechanical springs by using an advanced software model to incorporate the constraining influence of the soft tissue surrounding the knee.
“We’ve created something that allows an implant to react the way it would as an integrated part of the knee,” CEO Bruce White said. “The natural human knee is perfectly adapted for mobility, dexterity and upright stance. Engineering replacement parts for the strongest joint in the human body is challenging—it may be just as challenging to design testing that accurately shows the parts are safe and durable enough to be implanted.”
Total knee replacement, the most common total joint procedure, is designed to replace the articular cartridge, which may have eroded over time or become damaged by extreme activity or trauma. Implant designers and manufacturers constantly are working to make artificial knees as good as the original, with a normal range of motion and a life expectancy of several decades. Success, however, has proven to be futile thus far.
Simulator machines are designed to test the function and durability of implants by recreating the loads and movements of almost any activity so the response of an artificial joint can be evaluated. Over the last two decades, the role of joint motion simulation has evolved from a scientific tool into an integral part of the design, manufacturing and quality assurance processes of implant device production. Soft tissue constraint originally was represented with simplistic linear models and mechanical springs. However, researchers found that wear results obtained using this method did not match their observations in patients.
“The constraining force of the softtissue is complex and asymmetrical,making it a challenge to represent,” White explained. “But VST is a sophisticated model and gives us the clearest picture we have of how a new prosthetic device will respond after it is integrated with the remaining biological structure of the knee.”
SpineGuard Finds Funding to Extend PediGuard Franchise
It takes money to expand a product line. And SpineGuard S.A. now has an additional $6.2 million to extend its platform of PediGuard devices, which enable surgeons to accurately place pedicle screws during spinal procedures.
The company’s newest investors include Paris, France-based Crédit Agricole Private Equity, Innoven Partenaires and A Plus Finance as well as Delta Partners (a global investment firm with offices in Dubai, Singapore, Spain and South Africa). The four have provided funding for SpineGuard’s latest product iteration, the Cannulated PediGuard, a device the company describes as a “smart needle” to address minimally invasive spine surgery.
“This additional funding to support further extension of the PediGuard franchise bears strong testimony not only to the clinical need for PediGuard but also management’s track record and strategy to grow the company,” said Alexia Perouse, partner at Crédit Agricole Private Equity and a SpineGuard board director.
The Cannulated PediGuard is the second variation of the company’s original product to be launched this year. In April, SpineGuard introduced the PediGuard Curv, a device with a curve-tipped probe rather than a straight tip. The privately held French firm designed the Curv to address surgeons’ preference for such tips when placing pedicle screws into the spinal column.
SpineGuard’s original handheld device, the PediGuard classic, received U.S. Food and Drug Administration approval in 2005. PediGuard prevents pedicle screw misplacements by analyzing the electrical conductivity of surrounding tissues in real time through audio and visual signals. The device detects changes in tissue type and alerts surgeons to the change during preparation of the screw site.
The market for pedicle screw-basedstabilization devices has been growing inrecent years due to the prevalence of spine instabilities and deformities as well as the increasing number of surgeons being trained in pedicle screw-based technologies.
The criticality of pedicle screw placement has been highlighted by published reports showing that high rates ofmisplacements can lead to such seriouscomplications as quadriplegia.
The criticality of pedicle screw placement is one of the main factors that SpineGuard executives believe will drive sales of the company’s newest product.
“We are grateful for the support from our four investors,” SpineGuard CEO Pierre Jérôme said. “New product development is a cornerstone of our strategy to entrench the PediGuard family of products as a ‘must-have’ solution to the clinical need for safer pedicle screw placement—the number one challenge in spine surgery.”
SpineGuard was founded in 2009 by Jérôme and Stephane Bette, former executives with Medtronic’s spinal division. The company, which has its U.S. headquarters in San Francisco, Calif., received $15 million in venture capital funding through July 2009 from four private equity and investment firms.
AAOS Gearing up for2012 Annual Meeting Designing a fun yet fully functional children’s playground can be a daunting task. But only for adults. Most kids find such a charge to be simple. Virtual experts at fun, children possess both the creativity and imagination to transform an ordinary playground into an oasis of amusement, with areas and equipment that serve only one purpose: to have a good time.
AAOS members who opt out of the playground build at next year’s annual meeting nonetheless will find plenty to keep them busy on the opening day of the event. In addition to the 32 symposia and 215 instructional courses, AAOS members can review the 577 posters and more than 88 scientific exhibits that will be on display. Other options include visits to the Resource and Job Placement Centers or the Multimedia Education Center.
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