The company then launched a functional anesthetic discography procedure. Patient numbers reached , Industry insiders told OTW at the time that the price Medtronic paid for the technology was way too high and the patents were ripe for challenge. He said the company would change the way it evaluated and executed future mergers and acquisitions. The financial performance of the Kyphon division did not pan out as hoped.
After the acquisition, Medtronic's management reported to its shareholders that Kyphon sales were flat and that the company was losing market share. Only recently with the company's core spine business excluding Kyphon and Infuse performing well, has the company become a market share gainer. In , two years after buying Kyphon, an orthopedic surgeon from the May Clinic, David Kallmes, published the results of a study in which he claimed that he found no difference between vertebroplasty and a placebo procedure in treating patients with VCF vertebral compression fractures.
Kallmes completed another study in comparing kyphoplasty to vertebroplasty. The two procedures are similar except the balloon is used in kyphoplasty. In , Noridian Administrative Services, a Medicare contractor, determined there was no clear evidence that kyphoplasty was different from vertebroplasty.
According to Biegelsen, spine surgeons have told him that Dr. If Dr. Medtronic is not talking about the sale of the patents. Biegelsen said it appears to him that the sale of the patents is an opportunity for Medtronic to leverage the Kyphon IP.
Medtronic told him that it remains committed to the Kyphon business. We tracked down the Orthophoenix headquarters to a Dallas office building which also houses a company called IP Nav, a full service patent monetization firm headed by an attorney named Erich Spangenberg.
That company is the licensing advisor to Orthophoenix. Spangenberg said that Orthophoenix is made up of a group of investors experienced in medical devices. He said the group heard rumors in that Medtronic was interested in selling their patents.
The Orthophoenix investors made an offer and Medtronic accepted. A compression fracture is a fracture of the bone on this side of the vertebral column or backbone see video. It literally crushes down due to the fact that the bone is so brittle that the sheer weight causes it to crack. You lose height in that bone as well. Vertebroplasty was invented about 30 years ago.
It has improved and become more common since that time. During this type of back pain treatment , we use a large needle called a trocar. We place the needle through the bone into the fractured bone. With vertebral augmentation, we insert cement through the needle and basically glue or cement those fractured pieces together. Since the fractures are no longer moving, the patient experiences back pain relief.
Kyphoplasty is vertebral augmentation with a balloon. At this stage Kyphon was not able to offer a complete system, and surgeons relied on bone cement produced by other companies. Neither could Kyphon make claims about the clinical benefits of balloon kyphoplasty. These drawbacks ended in when Kyphon made further filings with the FDA and received clearance to sell a bone cement specifically for use in the spine. The FDA also agreed that the clinical data the company provided about the effects of the procedure was sufficient to allow Kyphon to promote claims about the effectiveness of the treatment.
Success did not come without some measure of controversy, however. Early in Kyphon and Dr. Harvinder Sandhu, who had licensed an expandable, mechanical bone tamp to the company, sued Medtronic Sofamor Danek, accusing it of trade secret theft, fraud, breach of contract, and other charges.
Medtronic maintained that because Kyphon was the only domestic player in this niche market it was simply trying to keep Medtronic and others from entering it. Four months later Medtronic filed its own lawsuit against Kyphon, alleging that four of its patents related to balloon-dilation catheters and spinal treatment had been violated.
Francis Medical Technologies Inc. Also in Kyphon was joined in a different kind of controversy, stemming from the days it had reached out to prominent spine researchers. One of the most prominent in the field was Cleveland Clinic orthopedic surgeon Dr.
Isador Lieberman, who had been a major supporter of balloon kyphoplasty. However, in late he was regaled in the press for also having a financial interest in Kyphon, receiving valuable stock options in a company whose procedure he was touting.
He was required to tell patients of his financial interests if they asked, but did not have to volunteer the information. While Lieberman argued that his support of balloon kyphoplasty was based on the efficacy of the procedure, he was also connected to seven other orthopedic device manufacturers, from whom he might receive stock, royalties, and consulting fees. To help sustain its strong growth and achieve some diversity, Kyphon reached agreement on three acquisitions in Early in the year it acquired InnoSpine, Inc.
Kyphon also agreed to acquire St. Medtronic, Inc.
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