Thursday, September 29, 2011

Take the Money Out of D.C. and Bring it Back to Main Street

Spine Nation,

The word on the Street is that you as a Nation are feeling the pain of an anemic economy. Based on the your input, it is becoming evidently clear that the future is not quite as sunny as some soothsayers like to predict.  Whether you are the Big Kahuna, eating that Big Kahuna Burger, or a little fish, you are being battered by your companies (lack of innovation), the surgeons (not all, but you have key detractors), the hospitals (what ever happened to free markets), its administrators and staff (let's face it they view us as the enemy), the BS companies like Vendor Rape, Status Blow, and Rep Craps, that make you jump through hoops and fire in order to earn a living.  As for eating the Big Kahuna Burger, TSB's only caveat is, be wary of what happens to those that opt to eat the BKB, you are susceptible to getting a visit from Vincent Vega and Jules Winnfield.  Oh yes, spine nation, we feel your angst, and things are not about to get easier.

As yesterday's news unfolded in the NY Times, that bastion of socialist and radical news reported that health insurance companies are charging "sharply" higher premiums this year, outstripping any growth in your wages and creating more uncertainty, as the government and corporations struggle to drive down the unrelenting increase in the cost to delivering quality, yet affordable care.  As the economy struggles, needing a desperate InFuseon of Geritol ( a dietary supplement from yesteryear before HGH become a cocktail of choice), as the real unemployment rate hovers around 15-16%, an increase in insurance premiums is as welcomed as a case of herpes, or a visit by the DOJ to Mississippi (was that Gene Hackman and Willem DaFoe).  Interestingly, both political parties are mum when it comes to attacking or criticizing their benefactors, because contrary to what some of readers believe, both Houses of Congress are bought and paid for by Big Insurance.  The BS that Aetna, United Healthcare and Oxford espouse is despicable, claiming that their rate increases are simply keeping pace with increases from physicians, hospitals, and pharmacies. What increases? What they fail to tell you is that what is billed and what is reimbursed paint a highly different scenario.  Of course, everyone will blame Obamacare, aka Romney Care, (you know the same guy that calls Obama an elitist, while he himself graduated from Harvard Law School), because as TSB has said in the past, Obama is the boogeyman in the room, but those of you that understand how the game is played know that the insurance industry has never decreased your premium regardless of whomever was in office?  As my good friend Alex Lukianov would say, nyet, nada, nein.

What is striking about this news, is that many of you have communicated that due to the poor economy, surgeries are down.  Now whether this is affecting some locally, or nationally for the long term is still playing itself out.  But one thing we do know is that people are putting off surgery and visiting their doctor in order to avoid co-payments and high deductibles, or until they meet their deductibles.  The fact remains that the longer one puts off an office visit, or a surgery, the higher the cost in taking care of that patient. Despite a decrease in numbers, insurance companies are defending their record profits, increase in premiums, payouts to shareholders and bonuses paid to these Greedy Bastards (yes Dylan Ratigan you are not alone in your observations).  As Benjamin M. Lawsky is quoted as saying, "these increases are often hitting people who just can't afford it.  But, on the other hand, we have to ensure in keeping these insurance companies healthy."  How much healthy can they get?  Spoken like the Superintendent whom oversees NY State's Insurance Department, and probably was once associated in some form or fashion with a Big Insurance company.

Let's face it, this is a game, whereby the only people that are benefitting from the rules are the people making the rules, or find new and creative ways to circumvent the rules. So this is your opportunity to stand up and be heard, its time to take all the money out of politics, whether you believe it or not, special interest are killing each and everyone of you, its killing your ability to earn an honest living, its BRUTALLY divided a country that calls itself the "United" States. We are no longer tolerant of one another, nor our we a compassionate society, especially when it comes to our own citizens.  We have been deluged with more scams, and business models that do nothing more than tear down the moral fiber of a society and industry that once was respected.  Just because Wall Street does it, doesn't mean its legal, nor is it right. The irony is that for all the people that espouse free-market principles, the only free markets that exist are the ones that specific people benefit from individually.  Take the example of the commentary on our previous post that dresses down sales people, calling you spoiled, overpaid, and sucking ass, TSB would bet that was a surgeon.  Here's a typical scenario, whereby someone is critiquing what market forces allow you to earn. But what is Dr. Famous' position when his earning power is threatened?  How does he know whether or not his earning has been over inflated, and what outcry do we hear every time the topic of decreasing Medicare reimbursements are tabled, or Big Insurance does not increase their reimbursements? Rather than coalescing and attempting to stand up and fight, but then again, it is always easier picking on, and beating up the weakest link in any chain of events.  So when you get an opportunity our good friends Dylan Ratigan and Jimmy Williams are proposing legislation to get all the money out of politics, here's your chance.  TSB wants to know what you think?

Thursday, September 22, 2011

1865

Fellow bloggers, the last forty-eight hours have been interesting to say the least.  The title of our post "1865" signifies the one day damage that Nuvasive has incurred by dropping 12% in share price upon the market's and investors reactions to losing the verdict to Big Blue for infringing upon patents that are "owned" by Medtronic.  1865 is not about the year Abraham Lincoln was assassinated, nor about the year that we as a nation abolished and prohibited slavery. Depending upon the next phase of litigation, it might be a price, that one day, investors yearn for.  For those executives or other platforms that deny this blogs credibility, this is the year of living dangerously. Thank you. The reaction from those in the industry, including Alex Lukianov and his minions of analysts' was predictable.  Would any of our bloggers expect otherwise?  Your vigorous comments say it all.  Even Dr. Gary Michelson, a blast from both the plaintiff's and defendant's past, was thrust into this melee, and was quoted as saying, "people have to be respectful of intellectual property."  And if there is one individual that knows about burning the midnight oil with his cadre of IP lawyers, it is Dr. Michelson.  Whether one agrees with his past, one must be respectful of his legacy.

What does this say about Nuvasive, a company that has built its reputation and mystique on the XLiF and neuro-monitoring?  What does it say about Alex?  Has he lost his panache?  Highly unlikely.  What does it say about investors?  Are they gullible, believing the "hype" that analysts' profess about their favorite spine stock du jour?  Where is that guy that predicted on September 2, 2011 that the stock will go up 40% over the next weeks and months?  And what does it say about the analysts'?  "Painful, but manageable, bloodied, but still standing." Is that all there is?  How does a company predict on becoming a billion dollar baby, when they are spending tens of millions on legal fees battling an assault on their very existence?  If anything this litigation is far from over, and unfortunately for Nuvasive, it is going to take a little longer than predicted on becoming that Billion Dollar Baby.  This verdict was more than a bump in the road, it is a set back. Alex will tell you otherwise because his job is to be the spinemeister and he can play with house money.  The verdict will be appealed with vigor, while Nuvasive anxiously awaits Medtronic's next move.  TSB knows that some will respond that this is the cost of doing business in a highly competitive environment.  But, does this bode well for NuVa?

A company of Nuvasive's size can be sold.  But now, any buyer will have reservation until this litigation plays out. The fact is that until this litigation is resolved, why would anyone risk buying a portfolio that potentially will have royalties tied to Medtronic?  Realistically, at this phase of litigation, it looks like Medtronic is in the drivers seat, at least for the time being.  How long will the shareholders and investors continue to provide a vote of confidence for the leadership team at this company?  These are legitimate questions. In retrospect, many have raised questions regarding Nuvasive's quest, back in June 2011, to raise $325 million through the issuance of Senior Convertible Notes.  Yes fellow bloggers there is much to speculate about, but the reality is that the sun will rise and set today, and NUVA will not shut its doors, let's be realistic.  But what this verdict does is create a dynamic to how this company will proceed, and whether the leadership team here has the longevity to sustain multiple blows as Phase 2 and 3 develop in MDT's quest to utilize the patent laws to its advantage.  Regardless of your love or disdain for the Big Blue, let's be honest, if you were in their place what would you do?  In closing, Nuvasive is lucky that there wasn't an injunction placed on the sale of the products in question.  This brings back memories of the old days when a company named U.S. Surgical laid down the gauntlet and challenged J&J/Ethicon's market presence, only to be repelled like a fly on someone's ass.  Sometimes, history has a way of repeating itself.  So what's Alex's exit strategy if all else fails?  You know, TSB once had the pleasure of meeting Lauren Hutton, and her motto was, "don't ever let them see you sweat." Good Luck and Good Night.

Tuesday, September 20, 2011

Copy! Copy! Copy!

It's Game 7 of the Championship Series and NuVasive has the home court advantage, the anticipation is that this should be a blow out, considering that their opponent Medtronic hasn't won a game in many years.  Medtronic has taken their blows.  Some industry insiders began to wonder would they ever rebound, could they make the right pass, was their offense turning into an impenetrable defense.  After the Michelson debacle, it seemed that Big Blue has been staggering.  Even with a home crowd and the potential of some home calls, it was announced today that the NuVasive has taken it on the chin.  No fellow bloggers it wasn't a Floyd Mayweather sucker punch.  NuVa saw it coming.

It was announced earlier in the day, that a San Diego Jury with "laser like focus" awarded Medtronic $ 101.2 million in damages related to patent infringements by Nuvasive.   Of course other publications in the industry will come to NuVa's defense claiming a wash since the jury also found that Big Blue owes NuVasive $660 thousand for infringing upon one of NuVa's patents.  NuVa will now have to regroup and consider its legal option as to how to proceed with the verdict.  To quote NuVa's attorney, "Nuvasive copied nothing!" A San Diego jury thought otherwise.

But some questions must be asked.  How do investors continue to pour money into a company that has already lost a $60 plus million dollar trademark suit?  And now, $101.2 million?  It will be interesting to hear the "spin" on how "laser like" the Purple People Eaters will become as they continue their quest and journey to be a $1 Billion Dollar Company. There's no joy in Rancho Santa Fe tonight, nor do we think that anyone is drinking any Petrus.  It will be interesting to see how OTW reacts and spins this verdict, considering that our boy, the oracle of the industry, loves the Big Bear.  TSB wants to know how much will the markets react tomorrow to this decision?

Caveat Emptor

Greetings fellow bloggers. Based on your response to our last post regarding the Scripps decision to ban PODS from their hospital system, many questions have been raised regarding the OIG's response to U.S. Senators Grassley, Hatch, and Kohl's Senate Investigation. At best, the response still has those involved looking over their shoulder, as the OIG's intent is to methodically answer many questions that need clarification. What we have learned is that the OIG has major concerns regarding the proliferation of PODS and whether the mere existence of these entities has or will have an adverse effect on Medicare and other Federal programs. Obviously, those that have leveraged their earnings and futures on the legitimacy of PODS, are keeping a watchful eye on the OIG along with the ongoing investigation by the Wall Street Journal into Mississippi and Alabama. Some readers accuse TSB bashing PODS. Contrary to some beliefs, our position has been that until there is legislation that clearly defines this business model, PODS will run rampant without any boundaries. Whether they are ethical is another issue. Due to the lack of legal guidance, the OIG challenge will be to identify if the behavior, structure, and practices that PODS present violate any Federal Anti-Kickback Statutes? TSB's observation is that if they look deep enough, they will probably unearth more schemes than one can imagine. As PODS continue to to increase, the OIG's position is that guidance, legislation, and enforcement will be required. As the government continues it's investigation, their intent is to identify the financial arrangements that have been initiated between physicians and third parties acting as an intermediary between the POD and the hospital, the transparency between these parties and the hospitals, and the services that PODS offer in addition to the type of cost saving that these entities provide. A major focus will be on how many of these PODS are operating on Medicare patients, and is the impetus for these business model merely for profit, by driving up revisions and increasing surgical procedures. One could not expect anything less than a backlash from those that have leveraged their current and future earnings on PODS, but if recent history has taught us anything, it is that as long as it is legal, everything goes, regardless whether it threatens the mere existence and livelihood of thousands of industry professionals. An observer of PODS has even raised the potential of these PODS backfiring on the same individuals that are brokering these deals. In the long run, if some of these POD surgeons have such disdain for sales reps, accusing them of driving up the cost of delivering quality healthcare, who is to say that with one fell swoop they could eliminate their brokers, whom they view as less than partners, but more like necessary evils? What TSB has heard is that PODS are running rampant in the deep south and California, threatening the mere existence of a free markets. So the question must be asked, how is it that some of our readers cry out for free markets, only to game the system? Isn't there a conflict of interest when profits are driven by self-referral? And whom are some of the companies have gone from pretenders to contenders? What will be interesting to watch will be how hospitals, its administrators, and its compliance officers respond? TSB wants to know what you think?

Thursday, September 15, 2011

Ride The Lightening

As Metallica rings in the background, one must ask the question, for whom does the bell toll?  Screw one of our readers who constantly bitches and complains about the use of lyrics and metaphors on our blog.  As James Hetfield of Metallica belts out;

For a hill men would kill, why?  They do not know, stiffened wounds test their pride
Men of five still alive through the raging glow gone insane from the pain that they surely know
For whom the bell tolls, marches on....................

Well fellow bloggers, could this be the beginning of the end for POD's?  As Hemingway wrote in his masterpiece "For Whom the Bell Tolls, the Scripps and Sharp's Hospital Systems have ordered the demolition of a bridge that links POD guerillas to the our own very existence?  Contrary to some madman's insinuations, TSB's sense of duty clashes with those whom call out their free market principles only to contradict themselves when it comes to their own survival.

Today, it was announced at the Sharp's Hospital Systems that no longer, yes fellow bloggers, no longer will Sharp's allow anyone involved in a POD to do business with their hospitals.  Just like Scripps the gauntlet has been laid down. In addition to laying out this mandate, the word on the Street is that Phygen is Persona Non Grata.

As for the Scripps and Sharps Hospital mandate, you know what Jim Morrision once said, "This is the End my Friend, Beautiful Friend."

Sunday, September 11, 2011

Double Indemnity

"We're both rotten!"
                                 "Yeah, only you're a little more rotten!"

Fellow bloggers, Barbara Stanwyck's and Fred MacMurray's dialogue in the American film noir co-written by Billy Wilder and Raymond Chandler can be an appropriate description of the spine world that we live in.  Life can imitate art. Potentially our moment will play itself out  beginning in November of 2011. If life does imitate art, then Senator Chuck Grassley (R-IA) and Herbert Kohl (D-WI) will play the dual role of Barton Keys (Edward G. Robinson), whose job it was to find phony claims in the movie Double Indemnity.

November 2011 and the subsequent date of March 31, 2013 will usher in a new era of compliance.  The Secretary of Health and Human Services shall establish policies and procedures to ensure compliance with the requirements authored into provisions within the Sunshine Act, aka the Patient Protection and Affordable Care Act of 2009, passed by the Senate on December 24, 2009, and the House on March 21, 2010.  On November 1, 2011 the Secretary will begin conducting audits to determine that hospitals are also under compliance.  No longer will some of our highly esteemed hospital administrators be able to look the other way when it comes to questioning some of the current concepts in spine. Hospital compliance officers will actually have to start being accountable.

If there ever was a time to accelerate the arrival of March 31, 2013, the time is now. TSB can hear the outcry, especially, from our celebrated commentator whose constant derision of our blog includes labeling us a socialist and liberal forum.  Our only response is that some people wouldn't know the boogeyman if he jumped out and bit one in the derriere.  If your personal freedom's are so threatened, please do not read our blog, your utter non-sense will not be missed, but then we do believe in free speech, therefore, rant on.  Whether one agrees with our opinions, the reality is that once again our society needs to find balance in the individual roles we play in our lives, in our financial expectations, and the fact that maybe the illusion that we have created can no longer be translated into reality. Dr. Leary, where are you when you are needed?  Change will be good, and everyone will learn how to adapt or perish.  The recent outcry for less government is theater at its best. TSB can hear all those phony teabaggers, only to be contradicted by the recent events of Hurricane Irene whom invited herself into many of your lives and showered you with the wrath of Mother Nature.  And you know what Michelle Bachmann says, "it's not nice to full Mother Nature."  Ironically, the cry from Democratic and Republican bureaucrats on the state level in the East has been for more federal intervention, blaming the federal government for the mismanagement of their finances, and lack of action when it came to addressing the damns, rivers and streams that were never fortified in the event of a major disaster. Whatever happened to personal accountability and less government?  But this isn't what this post is about.

On March 31st, 2013 and the 90th day of each calendar year beginning thereafter, any applicable manufacturer that provides a payment or other transfer of value to a covered recipient shall submit the following to the Secretary,

Name of that individual
Business Address
Amount of Payment
Date of Payment
Description of Payment
Cash or Cash Equivalent
In Kind Items or Services
Stock or Stock Options
Any Other Form of Payment or Transfer (POD)
Description
Consulting Fees
Compensation for Services other than Consulting (POD)
Honoraria
Gifts
Entertainment
Food/Travel
Education
Research
Charitable Contributions
Royalty or Licensing Fee
Current or Prospective Ownership or Investment Interest (POD)
Direct Compensation for Serving as Faculty or Speaker for Medical Education
Grants
Any Other Nature of Payment or Other Transfer of Value,

These are just a few of the guidelines that will be enforced.  Hopefully the DOJ will look at every company excluding no one, especially some of the smaller companies that attempt to fly under the radar.   There are plenty of lawyers, surgeons and distributors burning the midnight oil in anticipation of how to circumvent the law. Whether the law will reign in the terror that we have inflicted upon ourselves will be determined by time.  Will this legislation dampen the endless schemes that are hatched by individuals in our industry whom condemn the law, yet rely on the law to find new and creative ways to circumvent the very laws that they decry? Will we see a return to innovation?  Will we see the demise of POD's, and phony consulting agreements?  Regardless of your role in the industry, the stench that many of you smell is the infestation of corporate dollars in buying business rather then developing newer and innovative modalities of treatment.  By leveling the playing field, we can separate the contenders from the pretenders, and stop the insanity that many of us are consumed with on a day to day basis.  Who knows?  So in closing TSB wants to know, is the Moon in the seventh house and will Jupiter align itself within Mars, is this the dawning of the Age of Aquarius?

Let the sunshine, let the sunshine in, the Sunshine in...........................................................

Tuesday, September 6, 2011

Ali v. Wepner, Bring Back the Old Days

This isn't the Fight of the Century, neither would one consider it the Rumble in the Jungle, one wouldn't even classify it as the Thrilla in Manilla.  This lawsuit is a heavyweight going after a middle weight in a sanctioned bout reserved for a San Diego federal jury.  The heavyweight is Medtronic and the middle weight is NuVasive .  Could this be a Muhammed Ali/Chuck Wepner bout?   The Bear is originally from NJ even though TSB highly doubts that he had Bayonne roots.  

Warsaw Orthopedics, Inc., a unit of Medtronic has accused LaJolla based NuVasive of infringing three patents for implants that are capable of being inserted translaterally, a plate and screw system that can be used to stabilize vertebrae, I believe the attorneys meant "fuse" in the cervical spine,  and a tissue retractor.  Medtronic's attorney orated in his opening statement to the jury, that Medtronic's damages are substantial and that a financial expert will present one option for calculating lost profits at $200 million (ouch), and another that is estimated much higher.  NuVasive on the other hand, contends that Medtronic infringed on its patent for a nerve monitoring system for lateral surgery. NuVa's attorney is quite eloquent in his defense of NuVa when he told the jury, "Nuvasive didn't copy nothin'."

It will be interesting to see how this bout develops, could a local jury affect the final outcome with some home cooking?  Boxing fans know that scoring points is quite subjective with jabs and body shots, unless one delivers a knockout punch, or a lethal kidney punch.  But what happens to NuVa if they lose this fight?  And, how many more fights can they lose before the can't get off the mat?  TSB wants to know whether our readers are rooting for the boys in the Blue Trunks, or the Purple Tights?  TSB is taking even odds that the judges will score a homegrown decision, gotta love our industry, Rome burns while the attorneys make all the money.  No wonder we can't get anything done.  You know what they say, "sooner or later love is gonna getcha, TSB wants to know what our readers think?

Monday, September 5, 2011

Are We Ready to Self-Implode? Yet?

As Mark Twain once said, "the reports of my death have been greatly exaggerated." As an author and humorist who grew up in Hannibal, Missouri, TSB can relate to Twain. As the summer comes to an end, and we enter the autumnal season there's only one question to ask our fellow readers, "are you ready for football?" Contrary to some observations, TSB does have a second, third, fourth, and fifth in line to succeed in the event of an attempt to subvert our organization, and contrary to a few industry platforms that would like to see our demise, the party goes on.

The past week's comments by our readers have exhibited the insanity that has come to rule the Spine World, your lives, and let alone the U.S. healthcare delivery system.  In addition to our readers comments, NBC Nightly News reported that the U.S. ranks 41st globally in infant mortality, and that we spend more per capita for healthcare in the US, than any other country in the world.  We would like to think that the majority of our readers are rational, we hope, and that this in itself is disconcerting, considering that five years ago we were ranked 29th, based on those facts TSB believes that we are moving in the right direction. NOT. Maybe it is time for a real Spine Summit, and not the BS Spine Technology Summit that has become a self-serving commercial venue for individual special interests, especially the person that runs it.  The definition of a Summit is a meeting or conference of heads of state, conducting diplomatic negotiations or an easing of tensions.  If there ever was tension in our industry, all one has to do is scroll down and read the comments on our blog site.  The only easing of tension at the Spine Summit is the hand massage each one of these individuals give one another.  You have a choice, patronize or boycott, and boycott seems to be more apropos.

How is it that we initiate a blog on a specific company, technology, a rare happening, or an individual observation, and it becomes a cry for help?  Don't believe it, just read the comments posted in the DTRAX blog. A.D.D., hopefully not, but then again, maybe so. The hilarious comments about the guy with $2,000 cowboy boots, Versace glasses, and canary sports jacket, we didn't know cowboys wore Versace, made us wonder what would the Duke would think if he was alive? Now there's a new definition for the rhinestone cowboy.  If anyone delivered a fitting reality check for the industry, TSB can only thank Mr. August 31, 2:37 p.m.. Yet, contrary to a minority of executives and surgeons opinions, this is our industry and many of you have made it what it is with your passion, commitment, and dedication to a job well done.  But getting back to our point, if our illustrious leaders happen to log on to our website, and we know you do, has it dawned upon you that you lack the leadership, the respect, verve and vision that it takes to make a difference. You have become greedy and useless as well, our readers can fill that in. You have become lackeys to your shareholders and the suck on the teat of The Street. Your arrogance belies most of our imaginations.  You lack the guts to do the right thing. As one of our eyes and ears on the street reported this week, where are the IDE's, where is the investment capital, what are the CEO's doing to drive progress and innovations? Blame the R&D departments, blame marketing, blame sales.  If y'all spent as much time focusing on innovation as you do on suing one another the world may be a better place.  

Well the fact is that if there ever was a time to have our so-called spine "heads of state" conduct a meeting and face the music, the time is now.  Our industry is a microcosm of a greater disease that afflicts the American Healthcare System.  GREED.   TSB wants to know are you willing to fight, or are you going to lie down?  Stay tuned for our report on the NuVasive and Medtronic as they go toe to toe battling one another in the courts.  Now that everyone has had their batteries recharged with a great vacation, it's time to get back to the spine world.