ODTu2008Staff Report05.21.13
The new knee offerings from DePuy Synthes, Zimmer Holdings Inc. and Smith & Nephew plc may have made the most noise at this year’s American Academy of Orthopaedic Surgeons (AAOS) annual meeting in Chicago, Ill., (see the “Take a Knee” feature on page 54), but new product rollouts and research findings certainly weren’t limited to just those companies. It was a robust year for clinical data and new technology across the orthopedic sector’s numerous categories as organizations used the annual gathering to showcase their latest offerings. The following are a few examples of the diverse products and findings highlighted during AAOS.
Solid Year for Research
Over the course of the last eight decades, the AAOS annual meeting has become revered for its showcase of new products and technology. In years past, the event has been used as a launching pad for thousands of innovations. Often lost amid all the new-product hoopla, however, is the clinical research that eventually could lead to future breakthroughs.
For example, one of the studies the academy unveiled in Chicago was how a gender-specific prostheses may not improve overall outcomes for female total knee replacement (TKR) patients.
The study evaluated 1,957 TKRs between 2006 and 2010 in women; 1,515 of those patients received gender-specific knees and 771 were given “unisex” joints. Clinicians reviewed radiographs of the knee for component fit and outcomes in both groups.
While female-specific implants had less overhang, the overall range of motion, knee flexion (bending), lateral release rates (kneecap movement) and pain scores were comparable in both the custom knee and unisex joint, according to the study. “While we certainly use [the female] components frequently [in surgery], we don’t detect any objective improvement in clinical outcomes, including pain scores and range of motion,” noted lead study author and orthopedic surgeon Alexander P. Sah, M.D. “At the same time, there was no detectable disadvantage of using the implant, such as increased blood loss or component migration. Benefits of using the gender-specific component may not be detectable by current measures, or may not exist at all. However, the additional size option definitely provides the surgeon with more flexibility during surgery and that is useful.”
Though the gender-specific knee research was one of the more noteworthy studies presented at this year’s AAOS meeting, more than a dozen clinical research analyses were discussed during the five-day event, including:
Center Valley, Pa.-based Aesculap Implant Systems LLC showcased several new technologies at AAOS: the Vega System knee, Enduro AS (alternative surface) and Columbus AS knee revision systems, Metha short hip stem and the IQ instrumentation platform.
Aesculap manufactures knee and hip orthopedic devices and instrumentation. The Vega System posterior stabilized knee replacement technology uses a post-cam design to mimic natural knee kinematics. The system reportedly optimizes pivotal motion while reducing surface stress.
The “alternative surface” featured in the Enduro and Columbus knee revision systems is made up of a more advanced version of PVD (physical vapor deposition) monolayer on titanium—or titanium niobium nitride coating. The new version has seven layers instead of only one, and is intended to improve resistance to wear and protect against the ever-worrying risk for the release of metal ions into the bloodstream. According to studies conducted by Aesculap, the level of allergenic ions such as cobalt, chrome, molybdenum and nickel are “below every biologic reaction limit,” as demonstrated in in-vitro tests.
The Metha short hip stem is a short, cementless hip prosthesis designed to preserve muscle and bone structures. Like the knee revision systems, this device depends on a coating technology for its primary feature. The Metha uses a proximal rough Plasmapore titanium micro-porous coating that allows for cementless implantation. The coating has an additional 20 micrometer thick calcium phosphate layer—the type of calcium found in cows’ milk—that is applied electrochemically. The material has an osteoconductive effect, accelerating contact between the bone and the prosthesis stem.
Aesculap’s IQ, or Intelligent Quality, instrumentation is part of a suite of services designed to provide hospitals with more efficient tool options in the operating theater. The platform includes dual-purpose instruments and surgical trays that are down-sizeable and reportedly streamlined for optimized workflow in the operating room, according to the company.
The Orthopilot navigation system also made an appearance during AAOS. The system was developed by Aesculap to perform optimal implant alignment without having to perform preoperational examinations or take radiation-intensive and expensive scans such as computed tomography or MRIs.
Also on display was the Plasmafit Pro acetabular cup system, which currently is pending 510(k) clearance from the U.S. Food and Drug Administration. The device has a porous titanium coating, which is desirable in orthopedic implants because it allows bone tissue to grow inside the structure, therefore maintaining a long and stable connection between the device and human bone. Because titanium encourages quick osseointegration (bone in-growth)—the fusion of the implant and the bone without the intermediary of soft tissue—it should allow for shorter recovery time and less pain.
The company also featured a polyethylene coating sample, Vitelene, a vitamin E-stabilized insert that is designed to minimize wear and oxidization. The insert currently is marketed in European countries.
Take Your Vitamins
The staff of San Diego, Calif.-based DJO Global Inc. left the sunny West Coast for cold, wintry Chicago, Ill. But they were too busy with introducing new technology to notice the change in temperature. What was on the agenda for DJO officials? It was the release of a number of new surgical devices.
Giving a whole new meaning to taking one’s vitamins, DJO is expanding its E-plus (which the company has branded “e+”) technology—a blended vitamin E polyethylene—throughout its product portfolio. The latest addition includes the first-ever—according to the company—blended vitamin E glenoid component for total shoulder arthroplasty. This option is now available with DJO’s Turon modular shoulder system. This Glenoid component adds to DJO’s E-plus 3D knee and Movation knee inserts as well as patellar components. E-plus was developed to lengthen the life of total joint replacements for active patients.
DJO’s E-plus implants are made with cross-linked polyethylene material, with vitamin E blended into the resin. This, according to the company, helps because vitamin E is an antioxidant that naturally occurs in the human body. The company also claims it helps to reduce long-term wear. In addition, DJO Surgical introduced the Movation total knee system with E-plus technology.
Also on tap, DJO showcased its new Trabecular Titanium acetabular system (the acetabulum is where the head of the femur meets with the pelvis), which is designed to provide an “aggressive fixation cup solution” for difficult primary or revision hip replacement scenarios. Trabecular Titanium cups are manufactured using an electron beam melting technology, which the company claims allows the porosity to be controlled and is integral to the cup (not a coating). Trabecular Titanium has an extremely high friction coefficient at contact with cancellous bone, which maximizes primary stability of the acetabular component and enhances bone integration.
Beyond Traditional Implants
Memphis, Tenn.-based BioD LLC, a biomedical company that makes biologic orthopedic products derived from placental tissue, introduced its BioDGenesis Micronized Tissue Matrix. Also on display was BioD’s entire placental tissue-based product portfolio including BioDfactor, BioDfence, and AmnioExcel.
BioDfactor is a liquid wound covering product for use in vivo to fill soft tissue defects. BioDfence is an in vivo wound covering designed to provide a physical barrier to protect tendons and nerves at the surgical site. AmnioExcel is a extracellular wound covering derived from amnion (placental tissue).
The BioDGenesis Micronized Tissue Matrix is a cryopreserved injectable allograft derived from human placental tissues for use as a wound covering in the treatment of localized areas of joint inflammation or soft tissue injury. The allograft primarily is used in sports medicine applications, but BioDGenesis reportedly can be used to cover and protect any wound or localized area of inflammation and to provide a natural scaffold that facilitates the migration and proliferation of the patient’s own cells to the site of injury.
BioD has more than 25 patents and provisional patents filed in connection with its proprietary processing techniques and the clinical use of its products, according to Greg Brophy, the firm’s president and CEO. BioD’s goal is to develop a “complete line of novel tissue-based products that will enhance the quality of patient care in a broad range of clinical applications,” Brophy said.
BioD’s research and development efforts are focused on the regenerative potential of amnion and other placental tissues, which have a unique biologic structure with their rich source of undifferentiated stem cells and the unique immune privilege that characterizes their function in the body. The company recovers tissue from live, healthy donors during childbirth.
Partnering for Innovation
Biomet Inc. and OrthoSensor kicked off AAOS with news of a partnership. On the first day of the event, Biomet, the Warsaw, Ind.-based manufacturer of orthopedic and biotechnology products, and OrthoSensor, a Sunrise, Fla.-based maker of intelligent orthopedics announced a co-promotion partnership involving Biomet’s Vanguard knee implant system and OrthoSensor’s Verasense technology.
Verasense is a trial bearing designed for use with the Vanguard knee implant, which is embedded with sensors and microelectronics to provide surgeons with real-time knee kinetic data. The sensors wirelessly transmit information to a graphic display, allowing surgeons to quantify soft-tissue loads throughout the range of motion. This, according to Biomet and OrthoSensor officials, enables the surgeon to make informed adjustments to the soft tissues and implant placement in order to allow for overall knee balancing. Research cited by the companies showed that soft-tissue balance may aid in the reduction of pain, polyethylene wear, and aseptic loosening while improving patients’ ability to sense movement within joints and joint position.
“Combining Biomet’s Vanguard knee system with Verasense takes knee replacement surgery to a new level of precision by providing surgeons with actionable, intra-operative data to quantify and verify that they balance a knee implant properly during total knee replacement surgery,” said Jay Pierce, CEO of OrthoSensor.
Showcasing Verasense was OrthoSensor’s highlight at AAOS. Verasense is a single-use instrument system that replaces the standard plastic tibial trial spacer block used during knee replacement surgery. “We are thrilled to be introducing Verasense, the first intra-operative system to combine balancing and alignment capabilities,” added Pierce. “Intelligent orthopedics is a new field that harnesses the latest innovations in sensors, microelectronics and wireless communications with the goal of improving healthcare outcomes and reducing the cost of treating musculoskeletal disease.”
Staying in Shape
MedShape Inc., an Atlanta, Ga.-based company that focuses on shape-memory orthopedic devices, introduced a 10 mm version of its DynaNail ankle arthrodesis nail. This smaller DynaNail expands the use of the intramedullary (IM) nail to patients with narrow bone anatomies that require smaller fusion devices. MedShape showed samples of its 10 mm and older 12 mm DynaNail devices at AAOS. Shape-memory alloys “remember” their original, cold-forged shape, returning to the pre-deformed shape when heated. Nitinol for orthopedic applications is manufactured to respond to body temperature.
According to the company, DynaNail is meant as an alternative to external fixators for performing tibiotalocalcaneal (ankle) arthrodesis procedures. The nail is made of nickel titanium (nitinol), which has shape-memory properties, and is designed to sustain compression across the joint on the level of an external fixator. Compression across the joint is important for ensuring the joint bones remain in close apposition and in promoting healing. Because DynaNail is supposed to eliminate the need for external fixators, the company claims that it reduces surgery time and minimizes the need for follow-up procedures. The method of insertion for DynaNail is the same as it is for traditional IM nails, so it does not require additional physician training.
“Surgeons have a number of product options when considering intramedullary rod fixation for treating complex ankle and rear-foot fusions,” said Randall Brower, M.D., D.P.M., of Desert Canyon Foot and Ankle in Phoenix, Ariz. “The DynaNail is the only ‘fourth generation’ rod to utilize new pseudoelastic nickel titanium technology. This has been a game changer with 100 percent fusion in all cases I’ve used it in to date.”
The insertion process requires orthopedic surgeons to increase the size of the implant tunnel across the tibiotalocalcaneal joint until they get “chatter” from the drill. Once the surgeon completes the tunnel drilling, either DynaNail size (10 mm or 12 mm) may be chosen depending on tunnel size. The new 10 mm size not only serves smaller bone anatomies, it is also a less invasive option while still retaining the compressive power provided by the nitinol.
Editor’s Note: In case you missed it, a full rundown of the new technology and research featured during AAOS can be found at www.odtmag.com.
Solid Year for Research
Over the course of the last eight decades, the AAOS annual meeting has become revered for its showcase of new products and technology. In years past, the event has been used as a launching pad for thousands of innovations. Often lost amid all the new-product hoopla, however, is the clinical research that eventually could lead to future breakthroughs.
For example, one of the studies the academy unveiled in Chicago was how a gender-specific prostheses may not improve overall outcomes for female total knee replacement (TKR) patients.
The study evaluated 1,957 TKRs between 2006 and 2010 in women; 1,515 of those patients received gender-specific knees and 771 were given “unisex” joints. Clinicians reviewed radiographs of the knee for component fit and outcomes in both groups.
While female-specific implants had less overhang, the overall range of motion, knee flexion (bending), lateral release rates (kneecap movement) and pain scores were comparable in both the custom knee and unisex joint, according to the study. “While we certainly use [the female] components frequently [in surgery], we don’t detect any objective improvement in clinical outcomes, including pain scores and range of motion,” noted lead study author and orthopedic surgeon Alexander P. Sah, M.D. “At the same time, there was no detectable disadvantage of using the implant, such as increased blood loss or component migration. Benefits of using the gender-specific component may not be detectable by current measures, or may not exist at all. However, the additional size option definitely provides the surgeon with more flexibility during surgery and that is useful.”
Though the gender-specific knee research was one of the more noteworthy studies presented at this year’s AAOS meeting, more than a dozen clinical research analyses were discussed during the five-day event, including:
- Two studies that show obesity alone may not diminish outcomes or increase the risk of complications in TKR recipients, though these patients could face longer hospital stays and related costs. The studies found the length of hospital stay and direct medical costs to be lowest among patients with a body mass index (BMI) of 25-30 kg/m2. Those with higher BMIs remained hospitalized for a day longer than their slimmer counterparts (7.77 days vs. 6.29 days) and paid more for their medical care (each five-unit increase beyond 30 kg/m2 cost an additional $250-$300 in primary knee arthroplasty hospitalization and $600-$650 in revision procedure hospitalization). Increasing BMI does not affect complication risk or surgical time, though researchers noticed a higher rate of infections among obese patients.
- A study that associates total hip replacement with reduced mortality, heart failure, depression and diabetes rates in Medicare patients with osteoarthritis.
- A study indicating sunny climates do not improve vitamin D levels in hip fracture patients. Researchers retrospectively reviewed the vitamin D levels of 1,539 patients (448 with acute hip fractures and 1,091 who received either total hip or total knee replacements) from December 2010 to December 2011 at a major southern California medical center. Overall, investigators found the majority of hip fracture patients over 18 had insufficient vitamin D levels and those aged 71 and older had significantly lower levels than the total hip and total knee replacement control group.
- Research that shows quitting smoking reduces pain in spinal patients. Study authors reviewed the smoking cessation rates and related pain in 6,779 patients undergoing treatment for spinal disorders with severe axial or radicular (leg) pain. Smokers both older and younger than 55 experienced more pain than non-smokers; mean improvement in reported pain during treatment significantly was different in smokers and non-smokers in both age groups. Those who quit smoking over the course of their care experienced less pain than patients who continued to smoke. Regardless of their age, smokers who continued their habit during treatment experienced no significant improvement in their pain.
- A study indicating past and current smokers face a greater risk for surgical complications. Researchers reviewed the records of all total hip replacement recipients between 2007 and 2009 to identify patients who used tobacco products at the time of surgery, or who smoked regularly prior to surgery. In general, smokers had a higher overall revision rate and a higher incidence of other complications.
- Research deducing that magnetic resonance imaging (MRI) can detect a failing or potentially failing metal-on-metal (MoM) implant before it can cause considerable damage. After assessing the MRIs of 70 patients who underwent revision surgery for a failed MoM implant, investigators discovered that MRIs effectively can identify tissue damage in MoM total hip replacement patients.
- A study that shows platelet-rich plasma (PRP) can reduce pain and elbow tenderness in patients with a chronic case of the condition. Researchers randomized 230 chronic tennis elbow sufferers and gave them either an injection of PRP made from their own concentrated blood platelets or a placebo. At 12 weeks, 55.1 percent of PRP patients reported improved pain scores compared with 47.4 percent of those given a placebo; 37.4 percent had less elbow tenderness versus 48.4 percent in the placebo group. At six months, 71.5 percent of PRP patients reported improved pain scores compared with 56.1 percent given placebos, and 29 percent experienced less elbow tenderness compared with 54 percent in the control group. At six months, 83.9 percent of PRP patients reported significantly less pain and elbow tenderness compared with 65.9 percent of the placebo group.
Center Valley, Pa.-based Aesculap Implant Systems LLC showcased several new technologies at AAOS: the Vega System knee, Enduro AS (alternative surface) and Columbus AS knee revision systems, Metha short hip stem and the IQ instrumentation platform.
Aesculap manufactures knee and hip orthopedic devices and instrumentation. The Vega System posterior stabilized knee replacement technology uses a post-cam design to mimic natural knee kinematics. The system reportedly optimizes pivotal motion while reducing surface stress.
The “alternative surface” featured in the Enduro and Columbus knee revision systems is made up of a more advanced version of PVD (physical vapor deposition) monolayer on titanium—or titanium niobium nitride coating. The new version has seven layers instead of only one, and is intended to improve resistance to wear and protect against the ever-worrying risk for the release of metal ions into the bloodstream. According to studies conducted by Aesculap, the level of allergenic ions such as cobalt, chrome, molybdenum and nickel are “below every biologic reaction limit,” as demonstrated in in-vitro tests.
The Metha short hip stem is a short, cementless hip prosthesis designed to preserve muscle and bone structures. Like the knee revision systems, this device depends on a coating technology for its primary feature. The Metha uses a proximal rough Plasmapore titanium micro-porous coating that allows for cementless implantation. The coating has an additional 20 micrometer thick calcium phosphate layer—the type of calcium found in cows’ milk—that is applied electrochemically. The material has an osteoconductive effect, accelerating contact between the bone and the prosthesis stem.
Aesculap’s IQ, or Intelligent Quality, instrumentation is part of a suite of services designed to provide hospitals with more efficient tool options in the operating theater. The platform includes dual-purpose instruments and surgical trays that are down-sizeable and reportedly streamlined for optimized workflow in the operating room, according to the company.
The Orthopilot navigation system also made an appearance during AAOS. The system was developed by Aesculap to perform optimal implant alignment without having to perform preoperational examinations or take radiation-intensive and expensive scans such as computed tomography or MRIs.
Also on display was the Plasmafit Pro acetabular cup system, which currently is pending 510(k) clearance from the U.S. Food and Drug Administration. The device has a porous titanium coating, which is desirable in orthopedic implants because it allows bone tissue to grow inside the structure, therefore maintaining a long and stable connection between the device and human bone. Because titanium encourages quick osseointegration (bone in-growth)—the fusion of the implant and the bone without the intermediary of soft tissue—it should allow for shorter recovery time and less pain.
The company also featured a polyethylene coating sample, Vitelene, a vitamin E-stabilized insert that is designed to minimize wear and oxidization. The insert currently is marketed in European countries.
Take Your Vitamins
The staff of San Diego, Calif.-based DJO Global Inc. left the sunny West Coast for cold, wintry Chicago, Ill. But they were too busy with introducing new technology to notice the change in temperature. What was on the agenda for DJO officials? It was the release of a number of new surgical devices.
Giving a whole new meaning to taking one’s vitamins, DJO is expanding its E-plus (which the company has branded “e+”) technology—a blended vitamin E polyethylene—throughout its product portfolio. The latest addition includes the first-ever—according to the company—blended vitamin E glenoid component for total shoulder arthroplasty. This option is now available with DJO’s Turon modular shoulder system. This Glenoid component adds to DJO’s E-plus 3D knee and Movation knee inserts as well as patellar components. E-plus was developed to lengthen the life of total joint replacements for active patients.
DJO’s E-plus implants are made with cross-linked polyethylene material, with vitamin E blended into the resin. This, according to the company, helps because vitamin E is an antioxidant that naturally occurs in the human body. The company also claims it helps to reduce long-term wear. In addition, DJO Surgical introduced the Movation total knee system with E-plus technology.
Also on tap, DJO showcased its new Trabecular Titanium acetabular system (the acetabulum is where the head of the femur meets with the pelvis), which is designed to provide an “aggressive fixation cup solution” for difficult primary or revision hip replacement scenarios. Trabecular Titanium cups are manufactured using an electron beam melting technology, which the company claims allows the porosity to be controlled and is integral to the cup (not a coating). Trabecular Titanium has an extremely high friction coefficient at contact with cancellous bone, which maximizes primary stability of the acetabular component and enhances bone integration.
Beyond Traditional Implants
Memphis, Tenn.-based BioD LLC, a biomedical company that makes biologic orthopedic products derived from placental tissue, introduced its BioDGenesis Micronized Tissue Matrix. Also on display was BioD’s entire placental tissue-based product portfolio including BioDfactor, BioDfence, and AmnioExcel.
BioDfactor is a liquid wound covering product for use in vivo to fill soft tissue defects. BioDfence is an in vivo wound covering designed to provide a physical barrier to protect tendons and nerves at the surgical site. AmnioExcel is a extracellular wound covering derived from amnion (placental tissue).
The BioDGenesis Micronized Tissue Matrix is a cryopreserved injectable allograft derived from human placental tissues for use as a wound covering in the treatment of localized areas of joint inflammation or soft tissue injury. The allograft primarily is used in sports medicine applications, but BioDGenesis reportedly can be used to cover and protect any wound or localized area of inflammation and to provide a natural scaffold that facilitates the migration and proliferation of the patient’s own cells to the site of injury.
BioD has more than 25 patents and provisional patents filed in connection with its proprietary processing techniques and the clinical use of its products, according to Greg Brophy, the firm’s president and CEO. BioD’s goal is to develop a “complete line of novel tissue-based products that will enhance the quality of patient care in a broad range of clinical applications,” Brophy said.
BioD’s research and development efforts are focused on the regenerative potential of amnion and other placental tissues, which have a unique biologic structure with their rich source of undifferentiated stem cells and the unique immune privilege that characterizes their function in the body. The company recovers tissue from live, healthy donors during childbirth.
Partnering for Innovation
Biomet Inc. and OrthoSensor kicked off AAOS with news of a partnership. On the first day of the event, Biomet, the Warsaw, Ind.-based manufacturer of orthopedic and biotechnology products, and OrthoSensor, a Sunrise, Fla.-based maker of intelligent orthopedics announced a co-promotion partnership involving Biomet’s Vanguard knee implant system and OrthoSensor’s Verasense technology.
Verasense is a trial bearing designed for use with the Vanguard knee implant, which is embedded with sensors and microelectronics to provide surgeons with real-time knee kinetic data. The sensors wirelessly transmit information to a graphic display, allowing surgeons to quantify soft-tissue loads throughout the range of motion. This, according to Biomet and OrthoSensor officials, enables the surgeon to make informed adjustments to the soft tissues and implant placement in order to allow for overall knee balancing. Research cited by the companies showed that soft-tissue balance may aid in the reduction of pain, polyethylene wear, and aseptic loosening while improving patients’ ability to sense movement within joints and joint position.
“Combining Biomet’s Vanguard knee system with Verasense takes knee replacement surgery to a new level of precision by providing surgeons with actionable, intra-operative data to quantify and verify that they balance a knee implant properly during total knee replacement surgery,” said Jay Pierce, CEO of OrthoSensor.
Showcasing Verasense was OrthoSensor’s highlight at AAOS. Verasense is a single-use instrument system that replaces the standard plastic tibial trial spacer block used during knee replacement surgery. “We are thrilled to be introducing Verasense, the first intra-operative system to combine balancing and alignment capabilities,” added Pierce. “Intelligent orthopedics is a new field that harnesses the latest innovations in sensors, microelectronics and wireless communications with the goal of improving healthcare outcomes and reducing the cost of treating musculoskeletal disease.”
Staying in Shape
MedShape Inc., an Atlanta, Ga.-based company that focuses on shape-memory orthopedic devices, introduced a 10 mm version of its DynaNail ankle arthrodesis nail. This smaller DynaNail expands the use of the intramedullary (IM) nail to patients with narrow bone anatomies that require smaller fusion devices. MedShape showed samples of its 10 mm and older 12 mm DynaNail devices at AAOS. Shape-memory alloys “remember” their original, cold-forged shape, returning to the pre-deformed shape when heated. Nitinol for orthopedic applications is manufactured to respond to body temperature.
According to the company, DynaNail is meant as an alternative to external fixators for performing tibiotalocalcaneal (ankle) arthrodesis procedures. The nail is made of nickel titanium (nitinol), which has shape-memory properties, and is designed to sustain compression across the joint on the level of an external fixator. Compression across the joint is important for ensuring the joint bones remain in close apposition and in promoting healing. Because DynaNail is supposed to eliminate the need for external fixators, the company claims that it reduces surgery time and minimizes the need for follow-up procedures. The method of insertion for DynaNail is the same as it is for traditional IM nails, so it does not require additional physician training.
“Surgeons have a number of product options when considering intramedullary rod fixation for treating complex ankle and rear-foot fusions,” said Randall Brower, M.D., D.P.M., of Desert Canyon Foot and Ankle in Phoenix, Ariz. “The DynaNail is the only ‘fourth generation’ rod to utilize new pseudoelastic nickel titanium technology. This has been a game changer with 100 percent fusion in all cases I’ve used it in to date.”
The insertion process requires orthopedic surgeons to increase the size of the implant tunnel across the tibiotalocalcaneal joint until they get “chatter” from the drill. Once the surgeon completes the tunnel drilling, either DynaNail size (10 mm or 12 mm) may be chosen depending on tunnel size. The new 10 mm size not only serves smaller bone anatomies, it is also a less invasive option while still retaining the compressive power provided by the nitinol.
Editor’s Note: In case you missed it, a full rundown of the new technology and research featured during AAOS can be found at www.odtmag.com.
New Funding Models Key to Keep Innovation Churning During this year’s American Academy of Orthopaedic Surgeons annual meeting in Chicago, Ill., Orthopedic Design & Technology caught up with Christopher Velis, president and CEO of MedCap Advisors, a Cambridge, Mass.-based firm that provides merger advisory, consulting and valuation services to medical technology companies. Velis has spent more than 20 years as an investment banker, consultant and venture investor in medical technology. He shared insight about the current state of investment in medical technology, what’s needed to spur continued funding for new product development and how, if government isn’t careful, the United States could lose its spot as a market leader in medical device innovation. The following are excerpts from our AAOS conversation: Orthopedic Design & Technology: How has investment in new orthopedic technology changed? Chris Velis: Some companies have found themselves really contained because of the state of the capital markets, particularly the state of the venture capital community, which is not flush with cash. As a result, many of the companies that would have been “layups” for venture capital five years ago are finding themselves very constrained. That’s a problem because it certainly hinders innovation. It also hurts valuation. That’s clearly not a positive trend. That said, when there is a lack of capital, other sources step in to fill the void. Traditional venture financings are getting back-filled by angel investors who are emerging en masse and providing lots of capital for developing technology. Wealthy families are stepping in to make investments, and sovereign funds from around the globe also are stepping in. More importantly, larger orthopedic companies are looking at deals a little bit differently than they were a few years ago. They are increasingly willing to make investments or strike partnerships that align the interests of newer technologies with their need for a developing pipeline. This is a really important factor, and it is motivated by their mutual interest. A little company needs funding, needs partners. Big companies have distribution channels, but most of them aren’t particularly good at developing new technology. They’re much better at sales, distribution and marketing. Many companies are operating in the old funding paradigm. If you’re able to step out of the old venture paradigm and look for new sources of capital and new structures, you’ll see exciting possibilities. I don’t see the traditional venture capital markets for orthopedics coming back any time soon. ODT: What kind of companies will be most successful in this new reality? Velis: Companies that can validate the market by generating some sales on their own prior to trying to develop an exit are always looked upon favorably. Because their concept is proven, they have their regulatory approvals, and nobody has stepped out to try and copy them. So that becomes a bit of a no-brainer. The second category is technology that’s disruptive, that has the potential to destroy existing markets. Those are more risky because they’re not validated by the market, but they are much more exciting. ODT: How should companies retool their thinking? Is there a message lawmakers are missing? Velis: You take an uncertain regulatory process and add the capital gains and medical device taxes, and you’ve got a major problem brewing with desire to invest in medical technology. That’s something that the federal government and that our senators and representatives in Washington [D.C.] should pay very close attention to because it puts us in a situation of losing our edge in medical technology to other parts of the world. That said, investors are going to have so start thinking very globally. There’s going to be price pressure on anything used in healthcare. Demographics are going to outweigh that. You look at an aging United States, a growing China, and most of all a huge population surge in India, and there’s absolutely no question that the number of patients on the planet is going to double and triple. There will be a huge need for medical devices, but a need for inexpensive and efficacious technology. We need to stop thinking about 90 percent margin implants and start thinking about three things: Does it save the hospital money? Does it prevent suffering? Does it save lives? If entrepreneurs are thinking about those three things with a global perspective and thinking innovatively about sources of capital and partnerships, they’ll succeed. Short of that, it’s a really hard path. [The medical device tax] should be repealed; it shouldn’t have been implemented in the first place. The United States has the best scientific minds in the world. Our firm is located smack in the middle of Harvard University. We have some of the best minds in the world right here in the Boston area. And that goes for many other parts of the United States—the best scientific minds and best resources. But we’re not demanding that the [U.S. Food and Drug Administration] be really clear about what it takes to get approval around innovative classes of products. Increasing capital gains tax on medical device investment when our goal is to drop the cost of healthcare makes no sense to me. This kind of investment should be privileged, not taxed at a higher rate if you’re going to risk your capital in this technology. And If you’re going to lower the cost of healthcare, why are you going to tax the devices used to treat patients? That really makes no sense. It will raise costs. It’s going to defer investment from what is one of our national treasures—our knowledge around medical science and healthcare.
— Christopher Delporte,
Editorial Director
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