Wednesday, August 24, 2011

DTRAX: Will It Make a Difference?

The word Providence is defined as a manifestation of divine care, hopefully Providence Medical Technologies will direct their universe and the affairs of spine patients in the future with wise benevolence. Some of you are wondering who is PMT, not to be mistaken for DMT, and what is it that they are hawking?

PMT is a privately held company developing percutaneous spinal therapies.  If you are interested in learning more please log onto  No TSB does not have any vested interest in this product, nor do we know any of these individuals personally. What Providence has is a facet system called the DTRAX, no relation to every salesman's nemesis, REPTRAX.  The DTRAX is a facet system for the cervical spine patients with radiculopathy.  The premise is to decompress and stabilize the affected cervical level via a minimally invasive approach.

The powers to be at Providence are Art Taylor and Jeff Smith  formerly of Kyphon fame who have aligned themselves with an Advisory Board comprised of Drs. Berven, Bradford, Eyster and Harvinder Sandhu.  Considering some of the previous technologies that have been marketing for facet therapies, maybe these guys are on to something, but you know what TSB says, can this technology stand up to the test of time?  Only time will tell. TSB wants to know, what our readers think?

Monday, August 22, 2011

Overhanging Transition? Or Just Plain 'Ol Piling On

If the spine industry were the NFL, right around this time, a zebra would run out on the field and throw a penalty flag.  It seems that Globus Medical, aka "when will they go public," must feel like they've been hit by several players after they've been tackled. Piling on has a new meaning. You know what the late Rosanna Rosanna Dana use to say, "it just goes to show you if it ain't one thing, it's another."  It's bad enough that the Cat has nine lives, but Les Paul, I mean David and his band are starting to play some dissonant notes.

On August 22, 2011, Rachiotek, LLC and the mighty Eli of Yale University have filed suit in the United States District Court in the District of Massachusetts against you guessed it, Globus Medical, for allegedly infringing upon the "675" patent by making, using, offering for sale, and or selling devices that provide spinal stabilization.  As a result of the patent infringement, Rachiotek is seeking preliminary and permanent injunctions and damages.

The case involves patent infringement, and arises under the Patent Laws of the United States, Title 35, United States Codes.  The patent in question, the "675" patent (U.S. Patent No. 7,931,675) entitled, "Dynamic Stabilization Overhanging Stabilization" was issued on April 26, 2011 to Panjabi et al.  The "675" patent is generally directed to spinal stabilization devices for use in stabilizing a spinal segment. In layman's terms a spinal segment between two vertebraes.  The "675" patent includes dependent and independent claims that define various principles of spinal fixation that are disclosed in the patent.

Example:  First and Second resilient members that cooperate to deliver a non-linear force displacement response to relative motion between the first and second attachment members or stops associated with the spinal stabilization device. One of the resilient members is an "overhanging" orientation. The Globus device in question is the Transition Dynamic Stabilization System. The Transition DSS includes first and second resilient members that deliver a non-linear force displacement response to relative motion between the first and second attachment members or stops associated with the Transition. One of the resilient members of the Transition is an "overhanging" orientation. All the usual allegations and infringements are included in the complaint.

Rachiotek LLC therefore asks for the following;

A judgement that "when will they go public" infringed upon the "675" patent
A preliminary and permanent enjoinment against Globus
A threefold increase in damages because Globus willfully infringed
Prejudgement and post judgement interest on compensatory damages
Attorney fees

And last but not least, a trial by jury. Considering that David once slew the mighty Goliath, the champion of the Philistines to show his true identity, how many more salvos can the King of Pain absorb?  Remember what David said when confronting Goliath, "This day the world will deliver you into my hands, and I will strike you down, and cut off your head."  How many more lawsuits will David have to fight?  Maybe it would have been easier to take this onto a battlefield rather than a courtroom.  You know what Louis Salinger once said,  "Some times a man meets his destiny on the road he took to avoid." David don't look back now, but it seems time is beginning to catch you, karma is a bitch!

Sunday, August 21, 2011

Sunday Op-Ed Piece

In the summertime when the weathers high you can stretch right up and touch the sky, when the weathers fine you got women you got women on your mind, have a drink, have a drive go out and see what you can find, when the weathers fine we go fishing or go swimming in the sea, We're always happy life's for living, yeah, that's our philosophy.

Yes spineologists, every now and then its good to come up and breathe, breathe in the air.  As Mungo Jerry inferred, a sabbatical is refreshing.  Go fishing, jump in the ocean, hugs you chillin' and spend some time with your loved ones. Just like our readers, commentators, and the U.S. Congress, the boys and girls of TSB needed a little rest and relaxation.  A five week vacation paid for by the people would have been nice, but, unlike the POTUS and the lame Congress its time to get back to work.  TSB must question our readers  and wants to know, has everyone had a great summer?  As we approach the autumnal equinox, everyone will be gearing up for the spine silly season.  So what does this mean?  It means that we will be going on the road, and TSB doesn't mean Iowa or Minnesota.  We will be going to CNS on October 1-6 in D.C , the Minimally Invasive meeting on October 21-23 in Las Vegas, and NASS on November 1-5 in the Windy City, topping it off with a kick flight on Southwest to CSRS on December 8-10 in Scottsdale. Who knows maybe with all the money that NASS rakes in, rather than spending it on some ridiculous guest speaker, this year they could hire the Counting Crows to entertain us.  A little pay back would be great for public relations.  If there is one thing TSB has learned about the investment community is that when they have a meeting, they know how to party.  With all the sponsorship subsidies that probably exceed hundreds of thousands if not millions of dollars, isn't it time that NASS paid us back?  Hey, let's hire another boring speaker to anesthetize the audience, or let's come in a day earlier and attend the Reverend Robin Young's annual Spine Revival.  TSB thought our members were having a Houston moment attending the recent Rick Perry prayer revival, who knows and whom really cares,  maybe old Rick himself will show up at the technology awards espousing the magic of stem cells.   With all the recent articles on stem cells the only ones that are missing are how to increase cylindrical filaments and real whiskers.

The last week has been a roller coaster ride and a wake up call for publicly traded spine companies based on the punishment that has been doled out.  Unfortunately, the disruption that some speak about is not occurring in new technologies, but in the downward spiral of stock prices. Ouch!  Am I dreaming or is this really happening to me? Some of the companies that have been tossed around have been those that believe that they are shakers and movers within the industry.  NuVasive  has been battered to the point where they have settled at a 52 week low, while AlphaTec has resembled a Duncan Yo-Yo,  while Orthofix has lost steam in light of hiring a new CEO.  Where are all those prognosticators and investors when you need them?  Have they lost their religion for spine?  TSB bets that the shorts are having a field day.  As more companies look to cut the fat, it will be interesting to see who survives in a sagging U.S. economy that will only place additional stress on the U.S. healthcare industry.  This week it was reported in various publications how cuts in healthcare may undermine the role in the labor market, as hospitals and companies look to cut overhead to reduce operating cost.  If you have a job, hang on because this ride is going to last longer than expected.

Though we were away, we noticed that there really wasn't much activity in the spine market, unless one considers Integra's launch of Zuma earth shattering.  Was that a Sea Spine product?  With a product name like that, one must wonder whether someone was hanging out in Malibu or whether they were having an ephemeral moment listening to Neil Young's  and Crazy Horse's 1975 album.  Hopefully, it was the latter.  So as we close another summer in the chapter of our lives, its time to gear up, get those suits cleaned, buff those shoes, and bring down the suitcase, let's see who will come out of the pack this fall in a tight horse race.  Will the market rebound?  Will some of the companies hit by a bear market and punishing economy rebound? Or, are we truly experiencing a correction?  It will be interesting to observe whether investor pessimisms cause angst and consternation at some of these companies.  It's been a great time to be short.  See you down the road.

Friday, August 12, 2011

Eve of Destruction or Reconstruction? You Be the Judge

Interestingly, a few of our bloggers commented that rather than focus on the negative in spine, how do we change the public's perception and police the industry ourselves, especially in light of the controversy swirling around POD's and INFUSE?  First a few observations. Why do bloggers attack one another with senseless insults when it comes to critiquing others strategic plans, ethics, products, and performance of specific spine companies?  Does it make any sense?  Where is Dr. Drew Pinsky when you need him? Defending oneself only adds credibility to one's culpability.  Rather than directing your high levels of testosterone at one another, isn't it time to use some of that testosterone to call out the executive management teams at some of these companies?  Don't you have any gonads boys and girls?  The leadership skill of some of these executives are no different than what we are witnessing in our own government. Blame everyone else for the current state of affairs rather than being held accountable for your past actions, lack of vision and innovation.  Does anyone drive looking over the horizon rather than what is in front of the hood of the car?

The constitution of this industry is a microcosm of a larger phenomena, and at present we have the opportunity to either be heard, or end up as collateral damage. We can have a generational debate, but the reality is that tenured professionals were once young, and the young eventually end up being tenured professionals.  It's a cycle, we can either stand united or fall divided.  You can either demand accountability or continue to drink the kool-aid.  The only difference between the spine industry and Jonestown is hopefully you will live to talk about it.  Forget about AdvaMed, a self-serving lame duck joke at best, forget NASS, they can't even keep their own house in order, what we need is a manifesto that outlines acceptable behavior to preserve our own existence. You can blame the Government, you can cast blame on the FDA, you can call out the insurance industry, you can call patients irresponsible, you can even call out surgeons that manipulate the environment to line their pockets with a few shekels, yet, until we change our own behavior and accept accountability for our contributions to this industry, nothing will change.  If you want to do something right, do it yourselves. Think about the absurdity of our industry.  Companies continue to hire the Usual Suspects with the belief that those individuals can bring some secret formula from a Medtronic, DePuy, Stryker, Synthes (RIP), Zimmer or Biomet.  The industry regurgitates the same individuals over and over, and what are the results?  How insane is it that companies rely on an idiotic poll or survey to determine whether an individual will succeed or fail?  If ever there was a time to establish a precedent for the future, the time is now. Whatever happened to getting to know someone for who they are, for what they have accomplished and whether they have an excellent work ethic?  We do love self-promoters, don't we? Are there any real leaders out there?  Can anyone make a responsible decision without worrying about being fired? You would think the shareholders run our companies. Are we experiencing the death of common sense?  Have we become so specialized that we have rendered ourselves insensible?

Division and uncontrolled greed is not good.  It serves no purpose.  Some of you will argue that greed is good, but greed is only good if it serves a greater purpose.   Some will say that the end justifies the means, keep rationalizing your actions.  As the heart and soul of free market enterprise, your attacks should be directed at the management teams rather than one another.  So why do some comments offend some bloggers?  Because your portfolio sucks?  Because your R&D department has no talent?  Because the new management team that was brought in from one of the giants in the industry continues to do the same thing over and over expecting different results, pirating their former employers distribution network in hopes of a major windfall?  Now there's creativity at its best, or, is it insanity at its best?  The fact is that we all have to earn a living, and the only way we will survive is if take our own action.  How many consultants can we hire so that they can change the design of another screwdriver?  So what does all this mean?  How do we do create a change?  Who leads?  Who follows?  Do we call out those organizations and surgeons that use nefarious and unhanded schemes for their own benefit, or do we idle in neutral and watch while Rome burns?  Why are we supporting organizations like NASS, CNS, AAOS, and AANS if they themselves continue to do the same thing over and over again?  Why don't trade industry professionals have their own forum at NASS, AAOS, CNS, or AANS, we are the foot soldiers that contribute to the temples that each company builds to pay homage to their slavish followers, or are we the slavish followers? TSB can only be your forum, as my great grandfather once said, "when a man's back is to the wall, you can either roll up your sleeves and fight, or you can roll over like a puppy dog."So TSB wants to know how do we effect change?

My blood's so mad it feels like coagulatin'
I'm sitting here just contemplatin'
I can't twist the truth, it knows no regulation
Handful of senators can't pass legislation
And marches alone can't bring integration
When human respect in disintegratin'
This whole crazy world is just too frustratin'

45 years later, and things still remain the same, insanity?  You make the call.

Sunday, August 7, 2011

Downgrading The Spine Market

To say that it has been a tumultuous and uncertain time in spine would be an understatement.  Since the beginning of the year, the industry has been making adjustments to a rapidly changing U.S. healthcare landscape.  In anticipation, downsizing began with Zimmer and Medtronic announcing layoffs, only to be followed by other key players such as Biomet and Alphatec. Granted, not all layoffs pertain to spine, but the industry has had its testosterone levels dropped a notch, and there is no need for a blood or saliva test. We are the enemy.  Outside of Nuvasive, many companies are experiencing a dose of reality playing in a market where surgical procedures are down, insurance denials are up, patients are afraid to have surgery because they are worried about losing their jobs, and declining ASP's are making many of the larger companies reassess their financial objectives and distribution models.  In addition we have POD's threatening the existence of thousands of  salespeople, blaming sales people for the high cost of delivering implants to the industry, bickering among surgeons on ethical practices, and two parallel U.S. Senate investigations.  Whether you like it or not, there have been more negatives than positives when it comes to reporting growth for many of the publicly traded companies, granted some changes in accounting rules have helped certain companies save face for another day of judgement.  Either you have something new, or you don't. And if you don't, sustaining market share may be more important than real growth to some of these organizations.  What is killing this industry and this country is that too many companies can only think short-term because of they have been hypnotized by their drug, Wall Street.  Some will argue that TSB is attacking the Street, yet even those of us that report what's been heard on the Street know that forecasts are an important metric to evaluate one's accomplishments and failure, unfortunately, we no longer think long-term. Everything is short-term.  Short-term thinking is providing the industry a rude awakening.   This week, the markets brought some companies back down to earth, taking some of that luster off their magic lamps.  You can blame the Europeans for this week's fall from grace, but the Market's performance has been on steroids to begin with.  In one fell swoop, valuations tumbled faster than you can say, "we continue to have laser like focus."

Outside of NuVasisve success, single digit growth has become the norm, unless you are one of the mid-level players in the industry.  Alex we must admit, you are one hell of a salesman.  Even though some analysts rave about some of the bigger companies, questions abound whether the industry is finally making the necessary adjustments as it moves into the second half of the year.  The most recent quarterly earning reports are not painting a pretty picture for spine.  Zimmer (3%), Biomet (10%), Orthofix (3%), Medtronic (1%), granted some of these numbers combine hardware and biologics, but spine is spine whether its hardware or software. So how does this shake out for the industry? Consolidation and annihilation continues to hover over the industry like an alien space craft.  Companies that have been surviving on a revolver line are close to being placed on a ventilator, while other companies are hoping to weather the storm.  Free markets are working their magic.  The strong may not necessarily be left standing on two feet, but the weak will definitely perish, especially if the economy continues to flounder and your company doesn't have innovation in the pipeline.  All this speculation about not investing into newer ideas and products because of the economy is short sighted.  This is a marathon not a race.

So rather than dwell on all the bad things that have happened since the New Depression occurred three years ago, TSB wants to know from our readers who are some of the up and coming companies?  Let's have a poll, you be the judge.  Does anyone have innovation that could potentially disrupt spine as we now know it?  Is there a game changer?  Who will come out of the pack in the second half of the year as someone willing to go long rather than short?  If there is one company that intrigues us, it is K2M. With all of this insanity, they seem to fly under the radar, not looking to bring public scrutiny to their attention.  Of course before your comments come to rest, our maniacal friend will ask when will Globus go public?  Get a grip on yourself, even if  that company had the ability to go public, it is so diluted that you'll probably make pennies on the dollar. So in closing, just like the U.S. Government, spine has been downgraded as an industry.  Until we fix our own house, it might get worse before it gets better.  You know what Jackson Browne once sang.

"these days I'll sit on cornerstones and count the time in quarter tones to ten, my friend don't confront me with my failures, I have not forgotten them."

Tuesday, August 2, 2011

Is Technology Distracting the Art of Surgery?

There's an opening scene in the documentary It Might Get Loud, where Jack White, the infamous maniacal and passionate guitarist is driving down a country road in Franklin Tennessee with l'il Jack in the back seat and states, "technology is a big destroyer of emotion and truth.  Obviously it makes it easier for you to get home sooner, but it doesn't make you more creative as a person.  That's the disease you have to fight in any creative field, ease of use. "

On July 31st, the Courier Journal reported that two Norton Healthcare surgeons form Louisville, Kentucky were criticized by The Spine Journal (TSJ) for allegedly under reporting or failing to mention side effects from INFUSE and Amplify.  TSJ said that John Dimar II and Steven Glassman were among surgeons that under reported or failed to mention side effects including cancer, male sterility, unwanted bone growth, and nerve damage in 13 papers published between 2000 and 2010 that were sponsored by Minneapolis based Medtronic.  The 13 papers in question concluded that INFUSE and Amplify were at least as safe as bone grafts.

TSJ is the official journal of the North American Spine Society (NASS).  In a statement NASS concludes that, " it harms patients to have biased and corrupted research published.  It harms patients to have unaccountable special interests permeate medical research, concluding that the adverse effects were 10 to 50 times greater than what was reported.  Three of the thirteen papers were authored by Dimar II and Glassman, whom declined to be interviewed for the article.

The paper in question was authored in 2009 by the two Louisville spine surgeons and four co-authors regarding a 463 patient trial of Medtronic's Amplify, saying the study failed to stress a link to cancer.  Granted Dimar II and Glassman were each paid royalties of $2.4 million dollars, but that was for top selling products that they had helped to develop. Several years ago Medtronic paid a fine of $40 million dollars to settle a claim that they had paid surgeons to use their products.  The obvious argument will be made by some of our bloggers that this is old news. Contrary to those beliefs, one must ask the question, has innovation in technology taken away the art of surgery? Innovation and emerging technologies are important.  But, where does one draw the line when it comes to a craft like surgery? Have training programs and surgeons gotten away from what made the art of surgery a great profession, the ability to transfer knowledge to one's hands and potentially enhance the patient's quality of life?  Has BMP become the victim?  Is BMP the really the root cause of the controversy that surrounds Medtronic and its relationships, or is it managing the behaviors inherent to our own human nature?  By not being forthright in their past findings, not only are these surgeons performing a disservice to the public, they are leaving a lingering cloud hanging over their reputations?  Maybe reputation really doesn't matter or does it?

All one has to do is open a copy of the original INFUSE training manual to understand the concerns that were expressed in the administration of the product.  Clearly, there were caveats.  Medtronic, as usual, will cooperate with the on going investigation by the Senate Finance Committee by turning over the appropriate documents in question, but in the end will they modify their behavior when a $40 million dollars fine is far less than the profits made on the commercialization of the product?  Industry insiders will argue that the FDA and big government are inept at designing an acceptable pathway to commercial use, and at times arguably so, but what happens when there is intent to obfuscate the truth?  TSB and its readers do not need to take sides in this ongoing debate, the exercising of orating in a public forum can be left up to those that are the gatekeepers of this profession, the surgeons.  It will be interesting to assess the climate at NASS this year, who knows maybe something good will come out of this, or, maybe like Jack White says, it comes down to convenience and ease of use.  TSB wants to know is INFUSE the victim or is it the culprit, you be the judge.