Thursday, June 24, 2010

Green Is In

Prior to providing our readers with some new information, the last week has been quite interesting reading comments related to the Synthes post. It seems that every time that TSB posts about this company, the animus and venom that is spewed about Synthes is fascinating. Turbulence causes angst, anxiety, and a sense of losing control, indicative by the many comments from our readers. Yes, fellow readers, it seems that the Cafe Pharmaites found a new venue to spew their venom. How dysfunctional can one company be? Maybe its time for some of their employees to listen, hear what they are listening to, contemplate and be reflective upon what they sound like to those of us that do not have the honor of working in that culture. But on to the news.

Hyperbranch Medical Technology announced the launch of their Adherus Spinal Sealant, known as the Green Peppa of spinal sealants. Colors seem to be a selling feature when it comes to these technologies witnessed by the Blue Goo that Confluent markets and sells. Hopefully Confluent can wake up and know that a new addition in the marketplace will make their job a little tougher when it comes to marketing and selling their product.

The Adherus has been proven to stop cerebral spinal fluid leaks and maintains a seal under high pressure. It is also being marketed as a adhesion barrier. Now the challenge will be for those at HMT not to get too crazy when it comes time to forecast their revenue expectations considering that most dural tears of the spine occur in revisions, and most our readers can attest that the number of revisions are nowhere near the number that many marketing/data reports convey. So in closing, Green in In and Blue is Goo.

On a lighter note one of our readers recently complained that the blog hasn't been updated enough. You have two options, start your own blog (competition is good for the market) or stop whining, unless you're willing to pay TSB to do this on a full time basis. At least we offer everyone a forum, regardless whether you agree with what is posted or not.

Thursday, June 17, 2010

Let's Make a Deal - What's Behind Door Number 3

No fellow readers, it's not Monty Hall asking Jay Stewart to open door number 3. Surprise, it was reported today that Amedica made an acquisition of a spinal implant company for $40 million. Could it be Atlas? No! Could it be Custom Spine? TSB heard that after Amedica kicked the tires on this company, the powers to be thought that Bennett and Abdelgany were smoking too much ganja in their hookah pipe. So who could this company be?

TSB thinks that based on the information it could be X-Spine or US Spine. We don't claim to know everything, but one thing we know we get a lot of breaking news before some of the other platforms in the industry. So in the spirit of having some fun, whom do our readers believe that Amedica paid $40 samollions for? TSB wants to know what you think?

Thursday Morning Op-Ed

Recently, a" self proclaimed thought leader" spoke at an industry related trade show announcing that though 2009 was one of the worst in over fifteen years, there was a glimmer of hope on the horizon. Unfortunately, this hope did not pertain to the spine industry. This week, another web-based platform announced that there was a mega spinal implant fire sale going on. Meaning, pricing has, is, and, will be an integral component in selling product. By now, all of you know that the highly esteemed Captains of Industry on Wall Street, you know, the market-makers and their analysts', have downgraded the guidance forecasting single digit growth for spine. Oh where oh where have those 20-30% days gone?

Ever since TSB launched its website in February of 2009 our contributors and staff have highlighted some of the challenges that this industry was going to face coming off a near collapse of the U.S. economy. By the way, has anyone ever been held accountable for that, or was that an act of God? Some of our readers questioned our analysis of many of the early and mid growth stage companies that were now going to have to compete in a zero-sum market, while those with questionable emerging technologies, needed to realign their financial forecasts and expectations. We even poked fun at some of the clowns to the left of me, jokers to the right, that continue to run some companies within the industry. For many years, spine was the holy grail of the implant industry. How could anyone deny a patient in pain treatment? Not the insurance industry. Hospitals accepted any price for a product because we were partying like it was 1999.

Our industry glutted the market with more knock- offs and versions of pedicle screws, cervical plates, inter-body devices, cervical and lumbar discs, interspinous process devices, biologics that we behaved no different than the Nigerian street merchants one sees in Paris, New York, San Francisco, London, or Rome. At least those people are honorable admitting that they are selling knock-offs. Yet, we continue to strangle the industry by attempting to reinvent the wheel. Have some of these designs really made a difference based on retrospective clinical data? In some instances yes, but in most, not really. For an industry that is run by sales, marketing, and financial experts, it seems many have forgotten what it really takes to build a business. Building a business is quite different than brokering customers, buying consultants, and treating people like a commodity. But let's face it, what can one expect when the industry has commoditized itself? To some degree we are on the verge of euthanizing ourselves if we don't change our behavior. No fellow readers, some companies will not disappear, but what awaits many of the smaller companies is a rude awakening. It's called consolidation. Some of these companies will actually have to develop something truly emerging, or, they will perish, or be left with the alternative of merging with another company. This will not be an acquisition, this will be a survival merger. Yet, TSB does not see this happening because of the size of some egos.

Many of these smaller companies have had a tremendous amount of turnover. Unfortunately, the turnover should have occurred on the CEO level. Our industry is the poster child for greed and insanity. The legal system loves us, witnessed by the many lawsuits that are currently taking place. Today Synthes is suing Spinal Kinetics, NuVasive is suing Orthofix, all for the preservation of market share. Yet, what does it say about your product when one must litigate? So in closing, Machiavelli was correct when he said, " I'm not interested in preserving the status quo, I want to overthrow it." TSB wants to know what our readers think?

Monday, June 14, 2010

K2M and Smith & Nephew: Tee 'em High and Let 'em Fly!

After kicking the tires on this stellar company, it seems that Smith & Nephew would rather spend its money on sponsoring golf tournaments (St. Jude Classic) than buying a spinal implant company. For a company that has some mediocre total joints and a formidable IM Nailing platform for trauma (TriGen Nail), this would have been a golden opportunity to buy a company that would have given them instant credibility as a playa in spine. Unfortunately, the powers to be felt that it was too steep of a price to pay. So where does that leave K2M?

In all likelihood, K2M can now be shopped around to a large pharma conglomerate, or a consortium of investors. TSB wants to know what our readers think?

Saturday, June 12, 2010

Is Bacterin Sinking, and Sinking Fast?

TSB received a call this weekend from an industry source who told us that there is trouble in paradise at Bacterin. Belgrade, Montana is paradise, isn't it? There were some integral resignations from the executive management team along with multiple sales people resigning. Could this be the beginning of the end? TSB wants to know what our readers have heard on the street?

Remember what Jim Morrison of the Doors once sang:

This is the end, beautiful friend
This is the end, My only friend, the end
It hurts to set you free, But you'll never follow me
The end of laughter and soft lies
The end of nights we tried to die
This is the end.

Thursday, June 10, 2010

Are Heads Starting To Roll at Synthes?

Word on the street is that Hansjoerg Wyss and the Board are beginning their cleanse. No fellow readers, they are not on a 21 day diet. If rumors are correct, it seem that the first to go is Hansjoerg Emch, no, this isn't an ethnic cleanse. Synthes was once a stellar company. They were the "gold standard" in trauma, and actually made some early inroads into spine. Like any legacy company, they became complacent, they became fat, they spent too much time chasing the skirts and smoking cigars, while the other companies focused on Synthes strengths, and took advantage of their weaknesses. They have become a mirrored image of the company they use to make fun of, Xerox, I mean Zimmer.

There is no question that they greatest marketing tool that this company once possessed, AO/ASIF resident and attending training, no longer holds the same weight it once did. Companies like NuVasive have taken it to another level, and, in return they have reaped the benefits. So if any of these rumors are true, there's a hard rain gonna fall on some of the misfits and miscreants that have managed and led this company into mediocrity. You know what TSB always says, "no one likes the truth, it's a bitter pill to swallow." Could this be the company that moves over so NuVasive can climb up the ladder? TSB wants to know what our readers have heard.

PS: If Wyss is listening, fire Birchler's ass or banish him to the Gulag.

Wednesday, June 9, 2010

Summer Time and the Livin' is Easy

Seems like May was a bad month for sales. Based on what was reported by numerous distributors to TSB, something seems amiss in the spine world. With the recent admission by Pearl Diver that they are modifying their guidance for the industry due to pricing pressures (duh), could the potential exist that the current state of the economy is catching up with the industry? I guess the only way some knuckleheads will believe that the industry is in for some tough times is when they hear it from some analyst who needs retrospective data to provide us with information that we already know. Some small companies that we have spoken with informed us that their revenue for the month of May suffered, or, was cut in half, and that was with investor business.

On an more entertaining note, the industry awaits the announcement whether Cardo has the chutzpah to pull the trigger on US Spine. It would be a marriage made in heaven, having the blind leading the blind. Hey Dr. Frost, if you have a few million that you would like to invest, TSB has a few ideas, and one of them would not be buying US Spine.

Seems like a few readers got their panties in a knot when we posted a blog about Michael don't call me Mike, DeMane being hired as the head honcho at LANX. Unlike most people, TSB likes the informality of a relationship. What a mea culpa on my part. TSB promises that he will pray to Allah for forgiveness. You can call me Ray, you can call me Jay, but don't call me Mike. Hey, what if we all stop at the LANX booth at the next major trade show and asking if Mike DeMane is available. I bet that would make 'em crazy.

It's been a bit on the quiet side over the last few weeks, and TSB is looking for some new information that we can blog about. Minimus raised $900K recently to drive their Ozone therapy platform, but some people think that it is too early in the game to throw capital at this venture, yet, one has to wonder whether they are on to something. Only time will tell.

Six weeks ago, TSB knew that Tornier was going IPO, unfortunately, since they are not a spine company, no need to get excited. Good luck Tornier, the dog and pony show has begun. Hate to write and go, but TSB has to get back to the Blackhawk/Flyers series. Hopefully, those Chicagoans can close the door on the Philadelphia Gangstas. Let's bring the cup back to the Windy City. See y'all on Michigan Avenue for Deep Dish Pizza, Bratz, and Beer.

Summer time and the livin' is easy, Fish are jumpin' and the cotton is high, Oh your Daddy's rich and your Mama's good lookin' so hush little baby and don't you cry.......

Monday, June 7, 2010

Mike DeMane Assumes Leadership Role at LANX

Mike DeMane was named the Chairman and CEO of LANX. Mike brings a distinguished track record to LANX. Formerly the COO, at Medtronic, the Evil Empire Danek (MEED), Mike was solely responsible in building one of the largest global spinal franchises during his tenure at MEED.

Lanx impressive portfolio is made up of numerous "me too" products along with their flagship product, the ASPEN. Fortunately, they are backed by numerous investors which should help Mike develop a strategic plan in executing and taking the company to the next level. Some of Mike's challenges will be to develop the business distribution model with younger direct sales reps. This model may weigh in on the investors patience, considering that it will take more time to ramp up sales in other product segments. If ASPEN accounts for more than 60% of revenue, it will take time, consulting contracts, and realistic expectations as to the time it will take to elevate this company to the next level.

The biggest challenge will be overcoming a reputation within the industry that this is a half-assed operation. Product innovation will not come from Mike, it will come from a creative and experienced research and development team. In closing we wish Mike well and suggest that he not surround himself with all his former MEED friends. It will take out of the box thinking in the current economic and healthcare environment for this company to really thrive. Good Night and Good Luck Mike!

Saturday, June 5, 2010

Sunday Op Ed Piece - Is a Change Gonna Come?

On May 28th, the DOJ announced a proposed settlement with the Idaho Orthopaedic Society, a Sports Medicine Group, and five orthopaedic surgeons. The settlement prohibits the aforementioned groups from conspiring with competing physicians in the Boise, Idaho area, denying medical care to injured workers and in boycotting Blue Cross by terminating their contracts to obtain higher wages.

This so-called conspiracy is a mirror image of what transpires within the insurance industry on a daily basis. Gaining favorable fees is the equivalent of slashing reimbursements, and threatening to withdraw from healthcare plans is no different than denying covering to subscribers, its the yin and the yang of modern day medicine. Why shouldn't physicians be allowed to practice risk management they do it on a day-to-day basis practicing medicine? Running a medical practice is no different than running a company, it's a business. Fortunately, we haven't started to pay physicians with chickens, yet, but the time is coming. Isn't it ironic that insurance companies can share information by purchasing data based information via Ingenix to help other competitors establish reimbursements based on volume and demographics, but doctors cannot share information with one another? By sharing this information, insurance companies can accurately price risk based on actuarial experience.

As federal and state governments continue to pander to big business by filing civil antitrust lawsuits against physician groups that coalesce to influence their reimbursements, once again the question must be asked, isn't it time to repeal the McCarron-Ferguson Act of 1945?

The McCarron-Ferguson Act is a federal law that exempts the business of insurance from most federal regulations, including federal anti-trust laws. To qualify for this exemption, each state had to engage in oversight. By allowing states to regulate the insurance industry without federal oversight only exacerbates the amount of graft and collusion that exists between state banking and insurance commissions, no different than the federal government. In addition, McCarron-Ferguson creates a safety zone for insurance companies to share information without worrying about private antitrust exposure. Selling insurance across state lines could potentially raise questions about greater federal involvement when one becomes engaged in interstate commerce. Its time to face reality that the current healthcare system and programs like workers comp and Medicare are in need of a serious facelift.

The formulas that have been used to reimburse physicians have outlived their time, meaning its outdated, and contains many flaws. What was good then doesn't necessarily mean that it is good now. But what can Americans expect when we are adverse to change, and when our own government specializes in band-aid solutions regardless whether it was Bush or Obama. A solution that is predicated on preserving ones poll numbers and special interests does not work in modern day healthcare. The system has used up its "get out of jail" cards by performing patch work carpentry and then letting the next guy have to worry about it. The system as we all once knew it is broke and in desperate need of reconstruction. TSB wants to know what our readers think.....

"I was born by the river in a little tent, Oh and just like the river I've been running ever since, it's been a long, long time coming but I know a change gonna come, oh yes it will"

Requiem for a Real Leader

Greetings fellow bloggers! TSB has returned from a hiatus where we were able to recharge our batteries and stop to smell the roses. It's important that everyone do that in order to keep in perspective what is important, and what constitutes the immaterial. As some of you know, I have always been a student of great leaders, and those not so great, indicative of the blogs that I have posted in the past. Therefore, TSB felt that it was important to visit this topic on the eve of my favorite leaders death, John Wooden, the legendary coach of the UCLA Bruins.

For those of you that never had the opportunity to meet Coach Wooden, he epitomized great leadership. In today's hyperbolic, self-promoting, egomaniacal society, he would have been passed on, overlooked, and frowned upon because of his unassuming personality and nature. Yet, history never lies, witnessed by his 10 NCAA Basketball Championships in 12 years from 1964 through 1975, that included an 88 game winning streak that will never be broken by the modern game, never. Coach never raised his voice, or attempted to intimidate any of his players. Team came first. He was a master strategist and tactician. His team respected his values and commitment because of the respect that he exhibited towards the young men that came to play for him. Dynasty's are not bought, leveraged, or built on phony marketing platforms. Dynasty's are built by laying a solid foundation, being respectful of those that are on your team, and understanding that it takes hard work, and a vision, to get to where you want to go. The team became Coach Wooden's guiding coalition. Each and everyone of his players had unique skills that complimented each others strengths and weaknesses. Coach Wooden empowered his players to execute. Preparation equals success.

Wooden was a teacher, explaining why something needed to be executed in a specific manner, a quality that lacks in our industry when it comes to leadership. It would probably behoove some of the impostors that claim to be leaders in the spine market to take the time and read Wooden's Pyramid of Success. You don't need to be a student of the game to appreciate his simplicity and genius. Maybe his genius was that that he enjoyed winning but he did not place winning above everything else. Wooden's team was successful because it was always about making the right choices, something that drastically lacks in this industry. So even though this isn't a post about spine, maybe subliminally it is. If you have an opportunity take the time to reflect upon Wooden's credo: "Be true to yourself. Make each day a masterpiece. Help others. Drink deeply from good books. Make friendship a fine art. Build a shelter against a rainy day."

TSB wants to know what our readers think?