Medical Product Outsourcing Breaking News

Medical Device Industry Responds to Senate Version of Healthcare Reform Proposal

Editor — Thu, 19 Nov 2009 15:07:00 -0500

The $849 billion healthcare reform proposal unveiled by Senate Majority Leader Harry Reid on Wednesday includes a $19 billion medical device tax over 10 years, about $20 billion less than the original Senate Finance Committee version and approximately the same amount as the House version.

Medical Product Outsourcing reached out to industry organizations and firms for reactions.

Advanced Medical Technology Association

“AdvaMed appreciates the Senate’s decision to reduce the proposed tax on medical devices consistent with the House bill. We will work collaboratively with the Senate and the House on the details of the policy,” the Washington, D.C.-based medical device advocacy organization said in a statement.

“There are many significant provisions in the Senate bill that will advance quality patient care and we commend the Senate for its efforts. We support the comparative effectiveness research provisions to guide clinical decision-making as well as delivery system reforms that can improve the quality of patient care and increase efficiencies. We also support appropriate disclosure of payments to physicians with a uniform federal standard to ensure transparency in industry-physician relationships.”

Medtronic Inc.

“Both the House and Senate have now proposed medical device taxes or fees totaling approximately $20 billion over 10 years – half of the original Senate proposal of $40 billion. A tax on medical device manufacturers could have untold adverse implications for innovation and jobs, and yet we accept the notion of shared responsibility in meeting the challenge of expanding access to affordable, quality health insurance for all Americans,” said Bill Hawkins, chairman and CEO of Minneapolis, Minn.-based medical device giant Medtronic Inc.

“We are encouraged by the progress in this area reflected in the new Senate proposal as well as the House healthcare reform bill passed earlier this month. The Senate and House proposals have substantive differences in how and when these taxes or fees would be applied to the industry, and we look forward to continued constructive work with members of both houses and the Obama administration to craft a final proposal that meets the important tests of transparency, predictability, simplicity in administration and fundamental fairness.”

Biomet

“We encourage Congress to work on a permanent solution to the current system for physician reimbursement to ensure an ongoing supply of surgeons who treat musculoskeletal disorders,” said Bill Kolter, corporate vice president of Biomet, based in Warsaw, Inc.

Visit http://democrats.senate.gov/reform/patient-protection-affordable-care-act.pdf to read the complete Senate healthcare reform version.

Please e-mail tsohn@rodpub.com if your medical device-related firm or organization would like to contribute a reaction.

FDA Issues Warning Letter For Manufacturing Problems at Medtronic CRDM Facility

Editor — Thu, 19 Nov 2009 12:09:00 -0500

Medtronic Inc. has received a warning letter from regulators after an inspection of the company’s Cardiac Rhythm Disease Management facility in Mounds View, Minn.

The letter from the U.S. Food and Drug Administration (FDA) said it found problems with corrective and preventive action and field action timeliness; review and documentation of field action recommendations; supplier qualification and controls; and medical device reporting timeliness.

“Medtronic remains committed to providing the highest quality products to our customers and is working with FDA to resolve all remaining issues as quickly as possible,” said Pat Mackin, president of the Cardiac Rhythm Disease Management business and senior vice president at Medtronic.

The company said it will respond to the letter within 15 days and has already started to implement changes. The FDA said the firm’s promised corrective actions appear to be adequate and that it will re-inspect the plant.

Lombard Medical Technologies to Sell Coatings Subsidiary to Bayer MaterialScience

Editor — Wed, 18 Nov 2009 11:31:00 -0500

Lombard Medical Technologies’ wholly owned subsidiary, PolyBioMed Ltd., has agreed to sell the polymer coatings business to Bayer MaterialScience AG for more than $1 million, according to the Oxfordshire, London, firm.

The acquisition gives Leverkusen, Germany-based Bayer MaterialScience access to areas such as coronary drug-eluting stents and catheter systems for interventional cardiology, urology and neurology. The company is looking forward to PolyBioMed’s technologies to offer an extended portfolio of permanent and biodegradable surface modification techniques, it said in a statement.

PolyBioMed, headquartered in Sheffield, United Kingdom, which had a net loss of about $60,000 in 2008, develops drug-eluting coatings for coronary stents, as well as hydrophilic surface treatments and lubricious coatings to reduce friction on cardiovascular and urinary catheters respectively.

Under the terms of the agreement, PolyBioMed will sell the contractual rights and intellectual property of its polymer coatings business to Bayer MaterialScience AG, with the remaining assets to be sold to Bayer Plc.

“This acquisition complements our existing portfolio of coatings technologies for the medical device industry and offers us a significant foothold in this large and growing segment. We will be investing further in coatings application andtesting facilities which will significantly expand our services to customers,” said Dr. Hans-Wilhelm Engels, senior vice president of coatings, adhesives and specialties of Bayer MaterialScience.

John Rush, CEO of Lombard Medical, said: “This disposal will further focus the company’s business and the proceeds to be received on completion will usefully reduce the company’s funding requirement.” This divestment is part of Lombard Medical’s strategy to focus its resources on Aorfix, a endovascular stent graft for the treatment of abdominal aortic aneurysms.

Medtronic Holds Grand Opening for Diabetes Center in Texas

Editor — Wed, 18 Nov 2009 09:08:00 -0500

Medtronic Inc. has held a grand opening for its new Diabetes Therapy Management and Education Center in San Antonio, Texas.

The operation provides customer care and education for patients and healthcare professionals using Medtronic insulin pumps, continuous glucose monitoring and therapy management software for the treatment of diabetes, according to the Minneapolis, Minn.-based medical device giant.

The San Antonio facility employs more than 200 and anticipates hiring nearly 1,400 people within the next five years.

“Not only is this facility a center of excellence for diabetes therapy management, it supports Medtronic’s commitment to accelerating the pace of innovation to improve patients’ lives,” said Katie Szyman, president of the Diabetes business and senior vice president at Medtronic. “We are delighted to be able to expand our business operations in the San Antonio community, as well as support South Texas by bringing new jobs to the area.”

Medtronic’s Diabetes Therapy Management and Education Center is integrated with the Diabetes business, which is based in Northridge, Calif.

Wright Medical Group Names CFO

Editor — Tue, 17 Nov 2009 13:04:00 -0500

Wright Medical Group Inc. has appointed Lance A. Berry as senior vice president and chief financial officer, according to the Arlington, Tenn.-based firm.

Berry will replace John K. Bakewell whose resignation will take effect Dec. 11. Bakewell has accepted a position with another company.

Since joining Wright in 2002, Berry has served as the company’s vice president and corporate controller with responsibilities for internal and external reporting, global corporate accounting, and leadership and support of multiple corporate strategic and operational initiatives.

Before he was hired at Wright, Berry served as audit manager with the Memphis, Tenn., office of accounting firm Arthur Andersen LLP.

“We are pleased to have someone of Lance’s caliber and extensive experience within our organization step into the role of chief financial officer. This is a good example of our management succession plan preparing us for this event,” said Gary Henley, Wright’s president and CEO.

FDA Classifies Synthes Device Recall as Class I

Editor — Mon, 16 Nov 2009 12:23:00 -0500

Regulators have classified a recall of Synthes’ Synex II Central Body components as Class I, which means the product could impose an imminent hazard to patients’ health. This news comes after the U.S. Food and Drug Administration received six adverse event reports.

These reports included moderate to severe loss of vertebral body replacement height (caused by failure of the central body component) at six to 15 months after implantation. Potential adverse health issues that could be associated with this issue include neural injury, increased pain, spinal kyphosis if unrecognized, failure of supplementary fixation, and/or need for re-operation/revision surgery.

Synthes advises that surgeons and hospitals in possession of the device must stop implanting them immediately, and physicians should contact Synthes for return instructions.

The recall involves part numbers 04.808.001-011, Synex II Central Body, Titanium (all lots).

Physicians with questions related to this medical device recall should contact Synthes, based in West Chester, Pa., at (800)620-7025, ext.5375. Any adverse reactions/events experienced with use of the Synex II Central Body devices should be reported to Synthes at (800) 752-0128, or ComplaintUnit@synthes.com.

Cardiac Science Issues AED Voluntary Medical Device Correction

Editor — Mon, 16 Nov 2009 10:06:00 -0500

Cardiac Science Corporation is initiating a voluntary field correction after it was determined certain automated external defibrillators may not be able to deliver therapy during a resuscitation attempt.

Affected models include the Powerheart 9300A, 9300C, 9300D, 9300E, 9300P, 9390A, 9390E, and CardioVive 92531, 92532, and 92533 devices manufactured between August 2003 and August 2009.

Device failure may affect resuscitation of the patient, which could lead to serious adverse events or death, according to the Bethell, Wash.-based firm.

Cardiac Science has received 64 complaints concerning four resistors within certain AEDs. Two of these complaints were associated with a failure to deliver therapy.

Until a correction is available in May 2010, the company advises customers to check the status indicator on the front of the AED and follow the procedures documented in the materials accompanying the AED.

The company has implemented more stringent testing of the components and all AEDs produced since August 2009 are unaffected, and a software update to address the resistor issue will be available by May 2010.

K2M, Smith & Nephew Make Distribution Deal

Editor — Mon, 16 Nov 2009 09:38:00 -0500

Spine device firm K2M Inc. has entered the German spine market through a distribution deal with Smith & Nephew GMBH, according to the Leesburg, Va., company.

Earlier this year, K2M received PMDA (Japan’s Pharmaceuticals and Medical Devices Agency) approval for its MESA Spinal System and began distributing its flagship product in Japan. In addition to announcing the opening of a distribution office in the United Kingdom in October, the company also recently entered the Austrian marketplace. These new market launches supplement K2M’s existing international activities in Spain, Mexico, Greece and Australia.

“This announcement furthers K2M’s strategy of bringing its revolutionary portfolio of spine products including the MESA and DENALI Spinal Systems, RANGE Spinal System, SERENGETI Minimally Invasive Retractor System, CASPIAN Spinal System and the ALEUTIAN® Interbody Systems to the global marketplace,” said Eric Major, CEO and President of K2M.

Mark Augusti, president of Spine & Biologics at London, England-based Smith & Nephew, said: “Smith & Nephew is already known in Germany for its innovative surgical spine products, and K2M’s exciting range of products will provide our customers with a fully rounded portfolio. These differentiated technologies will allow surgeons to address the most complex of spinal pathologies in addition to their degenerative needs."

FDA: Philips Healthcare Responded to Warning Letter

Editor — Fri, 13 Nov 2009 09:44:00 -0500

The U.S. Food and Drug Administration (FDA) found during an inspection at Philips Healthcare Inc.’s Andover, Mass., plant that the company was not meeting federal manufacturing standards, and the firm has since met those requirements, according to the federal agency.

The FDA had concluded that Philips, which manufactures medical devices such as patient monitoring cardiac care products and ultrasound transducers, did not use Current Good Manufacturing Practice requirements of the quality system. The agency will conduct a follow-up inspection to assure all changes have been met.

For the complete, warning letter, visit www.fda.gov/ICECI/EnforcementActions/WarningLetters/ucm186988.htm.

Study: Medical Device Segment In Top Tier of Angel Investments

Editor — Fri, 13 Nov 2009 08:50:00 -0500

Medical device, equipment and healthcare services market segments made up the largest share of angel investments in the first half of 2009, at 28 percent, according to a study released by the Center for Venture Research at the University of New Hampshire.

The overall angel investor market took a 27 percent plunge in investment dollars, the report said, coming in at $9.1 billion.

Angel investments in other categories include: software, 14 percent; electronics/hardware, 14 percent; industrial/energy, 13%; and retail, 8 percent. However, the number of entrepreneurial ventures that received angel funding actually increased 6 percent from a year earlier.

Angels have decreased their appetite for startup-firm investing, with 27 percent of investments in the seed and startup stage, a decrease of 19 percent from the first half of 2008.

“The change in investment behavior is likely an indication of both a need to increase investments in existing portfolio companies and a change in angel’s risk tolerance,“ the report said.

Additionally expansion-stage investing (14 percent) remained unchanged, and first-time
investments represent 58 percent of activity, a slight decline from the last 12 months.

To see the complete report, visit http://wsbe.unh.edu/files/Q1Q2_2009_Analysis_Report.pdf.

Stryker Corp. Acquires OtisMed Corp., Other Assets for More than $100 Million

Mike Barbella — Thu, 12 Nov 2009 16:16:00 -0500

Stryker Corp. has acquired an orthopedic technology firm and bone-cutting products from two other companies, according to the Kalamazoo, Mich.-based company.

Stryker has agreed to pay up to $103 million for the combined acquisitions, according to a news release, with $36 million of the purchase price coming in the form of milestone and royalty payments that are contingent upon the achievement of certain goals.

Orthopedic technology firm OtisMed Corporation will operate as part of Stryker’s orthopedics division and remain in Alameda, Calif. It will focus on customizable instrumentation for Stryker implants and Stryker’s Triathlon Knee System.

Founded in 2005, OtisMed has developed and commercialized surgical solutions that are customized to each patient. Its debut product, the OtisKnee, enables surgeons to match the size and placement of the implant to patients' unique and normal (non-diseased) knee anatomy. Surgeons are able to match the implant so precisely through company's ShapeMatch technology. Using 3-D software, the ShapeMatch technique optimizes the size and placement of the knee implant before surgery.

In addition to the purchase of OtisMed, Stryker has agreed to acquire assets from Mutoh Co. Ltd., a Japanese provider of equipment, products, instruments and services to the medical and scientific communities; and Synergetics USA Inc. in O’Fallon, Mo., a supplier of precision microsurgery instrumentation, used to produce Sonopet Ultrasonic Aspirator control consoles, hand pieces and accessories. These products will be incorporated into Stryker’s instruments division, which is located in Kalamazoo.

"The Mutoh Sonopet ultrasonic aspirator equipment has proven to be a remarkable advance in precise intraoperative fragmentation and emulsification of soft tissue and bone, which in conjunction with Synergetics' ultrasonic instrument tips, have expanded the surgeon's resources in performing neurocranial and neurospinal surgery," said David M.Hable, Synergetics president and CEO. "With Stryker marketing these products in the future, customers can look forward to the excellent customer support and service for which Stryker is well known."

The closing of these transactions is expected to occur before the start of the new year.

Companies Showcase and Launch New Products at Spine Society’s Annual Meeting

Editor — Thu, 12 Nov 2009 15:32:00 -0500

In what has become a yearly tradition, surgeons, scientists and corporate executives gathered in San Francisco, Calif., this week for the North American Spine Society’s (NASS) 24th annual meeting. More than 2,500 attendees were expected to attend the four-day event to explore and discuss the latest trends in spine education, research and innovation.

While the program for the four-day event featured 119 podium presentations, symposia, and special interest group discussions, most of the news was generated by product releases from the various companies that attended the meeting. This year’s array of industry-related items came from both well-established multi-billion-dollar companies such as Medtronic Inc. to startups such as Amedica Corporation. A detailed roundup of the products released at this year’s meeting follows. Click on each headline to read the articles.

Integra Spine Launches Paramount MIS System

Osteotech Bone Grafting Products on Display

SpineWorks Exhibits Cross Link Technology

K2M Expands MIS Product Line

Spine Now Announces FDA Approval of New Spine System

Amedica Unveils Four New Products at NASS

Medtronic Releases Mastergraft for U.S. Sales

Custom Spine Receives 510(k) Clearance of Regent ACP

Partnership to Focus on Stem Cells for Skeletal Repair, Regeneration

MagniFuse Highlights Nascent Technology at NASS

Covidien Introduces First FDA-Approved Spine Sealant

Healthcare Reform Could Impact Specialty Care

Editor — Thu, 12 Nov 2009 15:02:00 -0500

As the 24th annual meeting of the North American Spine Society (NASS) convened this week in San Francisco, Calif., treatment and technology were, of course, the primary topics of presentations and discussions. But, given the current political climate, as physicians and medical technology company representatives gather, talk of healthcare reform is inevitable.

A good portion of the event’s Thursday agenda is dedicated to an examination of the healthcare reform proposals currently being hashed out in Washington, D.C., and what the potential impact could be for spine physicians, patients and the medical technology firms that compete in this sector.

Raj D. Rao, M.D., advocacy chair for NASS and professor and director of spine surgery at the Medical College of Wisconsin in Milwaukee, sat down with Orthopedic Design & Technology to discuss how current legislative proposals could change the playing field.

“Overall, we have no argument that some sort of reform is required,” Rao said. “But many questions remain about what form the reform will take and what the end results will be.”

For example, there are aspects of the individual pieces of proposed legislation passed by the U.S. House of Representatives and the Senate’s Finance Committee, with which spine physicians take exception.

“President Obama’s push for reform is three-pronged. He wants to reduce costs to families, to businesses and to the federal government,” Rao explained. “He wants to reduce the number of uninsured patients and provide an insurance system that’s stable and secure. These are good goals, and, overall, we have no arguments that some sort of reform is necessary. But we have some concerns on the course chosen in the implementation of these goals.”

One of the concerns Rao cited was a provision in the House that would reduce payments for specialty physicians-such as spine surgeons-and increase payments to primary care physicians.

“We [spine physicians] are better suited to treat patients with spinal disorders,” he argued. “In the long term, spine specialists will provide more cost effective care for patients with spine disorders.”

Rao said that in the rush to reduce cost, there is a perception by lawmakers and perhaps the general public that too many procedures are being done.

“The question that needs to be answered is how do we continue to improve quality while still reducing cost,” he said, arguing that it would make sense to make payment adjustments only after significant research has been done. “Reductions in payments to specialists can affect our ability to provide appropriate care for our patients, and potentially exacerbate workforce shortages over a longer term.”

Legislation in both the House and Senate would create research centers to examine the efficacy of various healthcare services, devices, treatments and procedures. None of the bills require the research be used to force health providers to adopt new procedures or policies to cut costs, which is an administration priority. Obama provided $1.1 billion in the stimulus act to fund so-called comparative effectiveness research (CER).

Rao said the goal is laudable, but that comparative effectiveness research would be carried out by the government, which may not have the expertise to accurately evaluate what they’re charged to monitor and review.

“We feel very strongly that as CER should be carried out by people who understand the procedures and the technology,” he said. “There needs to be input from specialists.”

He also noted that part of the Senate Finance Committee’s legislation calls for a Medicare advisory committee to be created to determine how Medicare payments are made and to make changes where they see fit. The committee would be independent of Congress without and Congressional oversight.

“The Medicare advisory commission the senate proposes has no congressional oversight and should have appropriate specialist physician representation.” Rao said NASS has met with committee staff members in the House and the Senate to inform them of the society’s concerns.

“Will continue to reach out and try to educate them,” he said. “We’re hopeful that they will make some adjustments.” If some of the society’s requested changes aren’t made, there could be serious long-term impact on our ability to take care of patients with spinal disorders. “For example, one long-term effect would be fewer graduates from medical schools and fewer physicians pursuing specialties, which, in turn, will affect the innovative, high-quality care that the United States has been a leader in for many decades.”

Eurotech Group Wins $1 Million-Plus GE Healthcare Contract

Editor — Thu, 12 Nov 2009 09:21:00 -0500

Eurotech Group Inc., a supplier of embedded technology, has signed a multi-year contract with GE Healthcare for more than $1 million to provide an embedded computer platform for a future data capture device accessory, according to the Columbia, Md.-based firm.

The contract covers hardware and engineering services centered on Eurotech’s TurboXb embedded computer, which powers the GE Healthcare device accessory, which will deliver data to nursing staff for accurate, quick reporting.

“With the Eurotech embedded board operating as the computing platform for our device accessory, we will be able to support medical staff in various healthcare environments,” said Pamela Jackson Hall, general manager of GE Healthcare Systems.

Said Greg Nicoloso, CEO of Eurotech: “GE Healthcare is moving quickly to develop their device to improve patient care by minimizing reporting error and recording health data accurately.”

FDA Lags on 510(k) Approvals

MassDevice — Wed, 11 Nov 2009 08:20:00 -0500

MassDevice

An exclusive MassDevice investigation of 10 years of U.S. Food & Drug Administration data on its 510(k) approval process for medical devices shows that approval times for medical devices increased nearly 2 percent — while the number of 510(k) applications declined more than 19 percent — even as the FDA's budgets and staff levels rose.

In fact, contrary to its oft-stated goal of clearing 90 percent of 510(k) applications in 90 days, the watchdog agency's own data demonstrates that decision times are trending significantly longer. This and other key trends and data are available only in MassDevice.com's Eye on the FDA report.

For example, the average decision time for 510(k) approvals was 113 days in 2008, compared with 87 days in 2005, an increase of 30 percent in just three years:

Eye on the FDA, Q2 2009

The report examines other key trends and data on the FDA's 510(k) approvals process. Here's a small sampling:

• Average decision times for 510(k) approvals

• Average decision times by device classification

• 10-year history of 510(k) approval decision times and device classifications

• A list of all the companies and devices that received 510(k) approvals during H1 2009

• The most active geographic regions for 510(k) approvals, by device classification

Hottest Sectors and Device Classifications

"Medical device manufacturers should reconsider all timelines associated with the 510(k) approval process for medical technology," said Brian Johnson, publisher of MassDevice.com. "Taking into account a new, more stringent approach on the part of the FDA's new leadership and a comprehensive institutional examination of the 510(k) process that will likely result in recommendations for change, the regulatory path for new devices is likely to become longer, more costly and more onerous in the near future."