Tuesday, May 19, 2009

Requiem for Archus - Who's Next?

It was announced today that Archus has laid off 45 employees and is taking on water. After raising $63 billion dollars in eight years, where o' where does all that money go? I know that testing and IDE's are expensive but this is ridiculous. Last month the Investors put in another $2, 275,000 USD with another $17,225,000USD to be sold via Bridge Financing. The SpineBlogger speculates that by raising this capital, Archus can maintain liquidity while anticipating an infusion of the remaining Bridge. But are investors willing to bet on an implant that has been in the works since 2001 during this economy? Based on the filing, Archus is willing to give equity in the form of stock with warrants. The question remains, is the Bridge Open or Closed?

The SpineBlogger wants to know what the readers think. Is the TFAS a viable modality of treatment? The SpineBlogger has seen this implant close up, and made an interesting observation to a colleague. Initially, the SAS stated that the way to treat patients with DDD was with an artificial disc. Then the medical community identified that with secondary facet degeneration the industry needed to address facet pain. The SpineBlogger believes that if we take out enough of the structural composition of the spine where pain is emanating and replace the disc and the posterior roof with hardware, the surgeon should be able to eliminate pain, eventually!

The question remains: Is this the beginning of the end of Archus? Impliant? Facet Solutions? We want to know what you think!


  1. The Editor would like to edit the information in this article. It is $63 million rather than $63 billion

  2. I feel that there is no one right answer for every patient. There is probably a place for facet replacement, artificial disc, and nucleus replacement, but these companies claim to the surgeons and investors that the market is much bigger than it really is. The anterior artificial disc products (Charite and ProDisc) were claiming that these products can be used for a large percentage of lumbar surgical, but Dr. Cammisa’s study suggested that it was about 5%.

    Also, the results for these products long term are not as good as they claim. I believe that it is a biomechanical issue here as the spinal segment is three joints and when you only replace one or two, then the others are over-stressed. I tend to agree with your comments about replacing both the anterior and posterior elements of the spinal segment as the correct way to go, which would bode well for Disc Motion Technologies. They have very good clinical results through one year follow up (we will see in a couple of years), but they are finding it difficult to raise money. I believe that a large portion of the spinal community believes in this philosophy as well, but is cautious to bet on the success after the limited success of the anterior disc and the nucleus and facet replacements.


  3. It is interesting to note that in 2005 JP Morgan had published a forecast for the TDA market on the coattails of the first Spine Arthroplasty Society Meeting which I believe was held in Phoenix. At that time JP Morgan was predicting a much large market than really existed or exists comparing the efficacy of TDA versus Lumbar Fusions. This report estimated a single-level TDA at $5-6K per procedure. Today we see an entirely different market and cost per level. But who am I to raise a flag back then? I did not raise the kind of capital that Tony Viscogliosi did. And you know how the Street works. It goes back to my argument, just because you have the wherewithal to raise capital and run a company does not mean you really know what you are doing! The Raj Denohoy's of the world make most industry professionals laugh. Just because you attend meetings and talk to surgeons doesn't mean that you have a clue as to what goes on behind the OR doors.