Titan Spine Eyes Bigger Slice of Tricky Spinal Fusion Market

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leading spinal device maker, and has followed the industry for more than a decade.

“I think it would be totally fair to say that the 20-30 percent growth rates that characterized the spinal market throughout most of the 2000s have come to a screeching halt,” Wang says, citing Medtronic estimates of low single-digit market growth in 2015.

One factor is insurance companies are reluctant to cover spinal implant procedures, in part because there’s not a ton of clinical trial data demonstrating the surgeries consistently have positive outcomes for patients, Wang says. “That’s honestly a big part of why that entire niche has been under a lot of pressure,” she says. “Some of the best clinical data we’ve got suggests that, over the long haul, physical therapy is just as good as fusion. The payers really don’t want to pay for this stuff. As a result, they’re just making it much harder for any given surgeon to get a procedure approved for an individual patient.”

The spinal surgery industry has also come under increased scrutiny in recent years over questionable practices. The Wall Street Journal, for instance, has reported that some surgeons have been sued for medical malpractice for performing allegedly unnecessary spinal fusion procedures. The newspaper interviewed spinal surgeons who claimed that some of their peers perform these expensive procedures more often than they should, and in cases where it isn’t effective, because the surgeons and medical device companies stand to make a lot of money.

The federal government issued a fraud alert in 2013 warning about physician-owned distributorships—intermediaries between medical device manufacturers and hospitals. These businesses are controversial because the doctors get a cut of the sale of implantable devices used in procedures that they perform on their patients. (Titan says it doesn’t sell products through any physician-owned distributors.)

All of this is to say that Titan is hoping to grow its business in an increasingly challenging environment.

But Ullrich is still confident that spinal fusion can be effective for patients, if performed based on an accurate diagnosis and using the right technology. He practiced surgery for 19 years at the NeuroSpine Center of Wisconsin in the Appleton area, and retired last summer to run Titan full-time. Early on, his implant of choice was the threaded titanium cage, a device that looks like a hollowed-out screw. Ullrich says he found that using that type of implant was like “putting a round peg in a square hole,” and didn’t always achieve the desired union with the spine.

Once he started using the titanium devices he co-invented, he says, his patients started recovering quicker than those who had received the threaded cages. During his surgical career, he used Titan’s devices in 750 spinal fusion procedures, and says he never once had to remove a cage due to an incomplete fusion. “If you have good stability off the bat, then the bone heals a lot faster, and you can get mobilized a lot faster,” Ullrich says. [An earlier version of this paragraph incorrectly stated that Ullrich never performed follow-up procedures on his spinal fusion patients. In a few cases, he operated again to insert screws meant to reinforce the cages. We regret the error.]

The big caveat, of course, is Titan hasn’t proven any of this in a large-scale clinical trial. To win broad adoption by practicing surgeons, Titan will need a “claim that they can point to that shows definite superior results” compared with competing devices, says Michael Liang, a Chicago-based partner with Baird Capital who previously worked as a director of research and development at Cortek, a spinal fusion products company acquired by Alphatec Spine in 2005.

Titan hopes to bolster its credibility with a 150-patient, multi-site clinical trial that is beginning to enroll patients this month. The study will follow up with patients one year after … Next Page »

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