The $75 million settlement by Medtronic with the DOJ for allegedly (you have to love the law) advising hospitals and surgeons to perform VCFx procedures that could have been performed at outpatient facilities has created some consternation, and, a major shift in how the players in this space will move forward with their business plans. Recent studies substantiate the clinical efficacy and improvement in quality of life for patients when it comes to using Vertebroplasty as a modality of treatment. These papers contradict the recent government/insurance company funded hullabaloo over Vertebroplasty. Regardless of the challenges that this industry segment faces, investors continue to pour capital in vertebroplasty technologies witnessed by DFine closing $36.2 million in equity financing back in July. One company that has identified that it has to realign its strategic business plan because of Medtronic's shenanigans, is Orthovita. Like other companies within the industry, La Vita is having to modify its financial expectations and sales strategy as the industry continues to slow down. Analysts' reactions become predictable when strategic and financial challenges present themselves to any company. Yet, is this a bad thing for La Vita?
By moving vertebroplasty to an outpatient setting every company will have to accept the fact that reimbursements will be lower, and subject to more scrutiny because of Medtronic/Kyphon's alleged behavior. Many people criticize this blog site for various reasons, but this is an example of how the behavior of one, hurts the many that play in this space. The company with the best product (material and delivery system), for the best price, with the appropriate business distribution model will win the race for dollars and notoriety. Let's face facts, outside of a few front runners, the industry in general has shown minimal or flat growth. You don't have to believe TSB, just let the analysts' tell you. So maybe, this will be a wake call for each company looking for a piece of the vertebroplasty marketplace. Regardless, whether you like Cortoss, it has a place in the surgeon's armamentarium like Kyphon, DFine and other companies. The question will be who can reduce manufacturing cost, come up with the ideal distribution model and still competitively price their product. TSB wants to know what our readers think?