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Orthopedic and Dental Industry News Complete Archive »

Musculoskeletal News Roundup 28-Sept-07 BY LAUREN UZDIENSKI, SEPTEMBER 28, 2007

Legal
Federal prosecutors announced on Thursday the terms of a settlement with Zimmer, Depuy, Biomet, Smith & Nephew and Stryker following an investigation into physician compensation practices. Zimmer, Depuy, Biomet and Smith & Nephew entered into deferred prosecution agreements and will agree to industry reforms in addition to paying a combined total of $311 million. Zimmer will pay $169.5 million, J&J will pay $84.7 million, Smith & Nephew $28.9 million and Biomet $26.9 million. Stryker will not face monetary penalties, entering instead into a non-prosecution agreement. Like the four other companies, Stryker will agree to industry reforms and 18 months of corporate monitoring.

A 2001 patent-infringement lawsuit between Medtronic and Depuy was resolved this week in Depuy's favor. Medtronic was ordered to pay $226.3 million after a federal court found that the company's VERTEX line of multi-axial pedicle screws infringed a Depuy patent. Medtronic plans to appeal the decision.

Senator Charles E. Grassley (R-Iowa) has asked Medtronic to explain consulting payments to spine surgeons that have been made since 2003. In 2006, Medtronic paid a $40.0 million settlement to the federal government over allegations of kickbacks that were said to have occurred between 1998 and 2003. The letter is part of what the New York Times calls a "broad inquiry" into financial ties between industry and physicians.

Gregory M. Hudak and Jeffrey A. Hudak, brothers and owners of DAK Surgical, Inc. and DAK Spine, Inc.DAK Surgical, Inc. and DAK Spine, Inc. filed a lawsuit against Scient'x SA. and Scient'x USA, Inc. The lawsuit alleges, among other things, violations of a distribution agreement.

Artimplant AB announced that the company has cleared royalty rights for the basic patent for the biomaterial platform Artelon®. The present holder, Polyrand AB, will receive SEK 2.75 million ($0.42 million) to clear the agreement containing the rights. According to the company, this agreement will improve Artimplant's margin on license income from product sales by five percentage points.

Earnings
Corin announced 1H:07 financial results this week, with group sales of GBP 14.8 million (constant currency), up 7% over the comparable period. Reported sales were GBP 14.0 million, up from GBP 13.8 million in 1H:06. EPS on a constant currency basis was 2.68 pence, down from 2.83 pence in the comparable half. Reported EPS was 1.82 pence, compared with 2.83 pence in 1H:06. Highlights for the half include FDA approval for the company's Cormet Resurfacing System, the completion of distribution agreement with Stryker Canada for Uniglide and Kobayashi now selling Corin products in Japan. The company also noted that they have the manufacturing infrastructure in place to support anticipated growth and that their development program around core technologies is "advancing well."

M&A
Biomet completed its merger with LVB Acquisition Merger Sub, Inc., a wholly-owned subsidiary of LVB Acquisition, Inc. LVB Acquisition, Inc. is indirectly owned by investment partnerships directly or indirectly advised or managed by The Blackstone Group L.P., Goldman Sachs & Co., Kohlberg Kravis Roberts & Co. L.P. and TPG Capital. The company delisted from the NASDAQ on September 25.

Funding
Alphatec Holdings, Inc. announced the pricing of its public offering of 8,800,000 shares of its common stock at a price of $3.45 per share. The net proceeds, after commissions and expenses, of the public offering will be approximately $28.5 million. All of the shares are being offered by Alphatec. The Company has also granted the underwriters a 30-day option to purchase up to an additional 1,200,000 shares to cover over-allotments, if any.

Alphatec Holdings, Inc. announced that Canaccord Adams Inc., the sole underwriter of its previously announced 8,800,000 share public offering, has exercised in full its option to purchase an additional 1,200,000 shares of common stock. All of the shares are being offered by Alphatec. Alphatec expects the closing of the offering to occur on or about September 26, 2007.

Regulatory
ReGen Biologics received a "Not Substantially Equivalent" (NSE) letter from the FDA in response to the 510(k) premarket notification the company submitted for its meniscal repair implant. In apress release and conference call, Dr. Gerald Bisbee, ReGen's CEO, explained the FDA did not feel their product was substantially similar to previously approved or cleared products. Without a 510(k), ReGen would need to submit a PMA, which would mean it would take years to get the product approved. This is the second NSE letter the company has received.

ISTO Technologies Inc. received 510(k) clearance for InQu™, indicated as a bone graft extender in the spine and a bone graft substitute in the extremities and pelvis. ISTO describes the material a composite of hyaluronic acid and a three-dimensional, synthetic polyester backbone.

Small Bone Innovations announced FDA approval for its Artelon® STT Spacer. According to the company, the Artelon STT Spacer is implanted in the scapho-trapezio-trapezoidial (STT) joint between the scaphoid and trapezial-trapezioid bones near the base of the thumb, and it extends SBi's line of surgically implanted, degradable spacers to four applications. The company also announced that it received FDA approval for the PRECISE SD™ Volar Distal Radius Locking Plate system, which will be part of the company's Wrist Management portfolio.

RSB Spine announced FDA approval for the cervical and lumbar InterPlate™ devices for use in intervertebral fusion procedures. Included are versions to be used with solid bone grafts and morselized bone without the need for supplemental fixation.

Spineology announced that they are complying with an FDA warning letter they received earlier this month, wherein the FDA alleged that OptiMesh was being marketed for unapproved usage. The company says they have changed their marketing materials. In an interview with Pioneer Press, Spineology's lawyer, Mark DuVal, said that the warning letter came while the company was in talks with the FDA about their label and "confusion in the marketplace" as to the product's indication. DuVal suggested the company believed Kyphon may have fostered the confusion as well as the FDA's interest in the matter.

Product Introduction and Update
DePuy Mitek launched the EXPRESSEW II Flexible Suture Passer, a minimally invasive device used in arthroscopic rotator cuff surgery. DePuy Mitek calls the EXPRESSEW II the company's next generation in lateral suture passers, adding that the device can be used in a one-step procedure that "saves time by providing simplified needle and suture loading."

Altiva Corporation, a Charlotte, N.C.-based manufacturer of spinal implants, announced the completion of the 100th placement of the ALTES™ Anterior Buttress Plate in surgery. The plate, which was initially presented at the 2006 NASS meeting, is designed to help prevent migration or expulsion of bone graft in the thoracolumbar to the S1 region.

Smith & Nephew’s Endoscopy Division launched the KINSA RC 5.5 Suture Anchor, which is indicated for repairs to the rotator cuff. The KINSA RC Suture Anchor is the second in Smith & Nephew Endoscopy’s line of KINSA suture anchors, and the anchors feature a sliding, self-locking knot that permits the surgeon to secure the repair without tying knots on top of the tissue.

Partnerships
MIV Therapeutics, a developer of hydroxyapatite-based coatings, today announced a research collaboration with Smith & Nephew. The companies will work together to develop new coatings and drug delivery systems for orthopedic devices.

Appointment
DePuy Orthopaedics Inc. appointed David Floyd President of U.S. Operations. Previously, Floyd held positions at Abbott Spine, AxioMed Spine Corp. and Centerpulse Orthopedics.

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