Medical Device Daily Washington Editor

Emphasys Medical (Redwood City, California) has reported that it is offering itself for sale following the failure of its PMA for the Zephyr endobronchial valve system, a device designed to treat emphysema. The company's application went to an advisory panel last year (Medical Device Daily, Dec. 9, 2008), but failed by a substantial margin as the committee voted 11-2 against approvability, largely because many members of the panel found the company's efficacy data less than compelling.

The Zephyr is designed to allow air out of, but not into, the portion of a lung affected by emphysema so as to duplicate the effects of lung volume reduction surgery without incurring the surgery's risks or costs. The idea behind both approaches is to reduce the effect of the non-functioning portion of the lung on the organ's compressibility, which would relieve the uneven pressure on the diaphragm and hence restore a balanced state of respiratory affairs. According to wire service reports, the device has been available in Europe since 2003, but Emphasys has encountered financial headwinds of late, including the withdrawal of an initial public offering in May 2008.

Emphasys has raised roughly $90 million toward development and commercialization of the Zephyr, including $75 million in equity investments and the balance in debt. After the advisory committee hearing, the company's president/CEO, John McCutcheon told Medical Device Daily that he was not worried about financing a further effort to get the agency's stamp of approval. He said that the company's investors "remain committed to seeing this through."

At press time, Emphasys had not answered a call for comment.

Minnesota eyes doc gift legislation

The issue of payments to doctors by drug and device makers has hit another state legislature, Minnesota, despite the possibility of action on Capitol Hill. According to wire service reports, the Minnesota legislature's bill would completely ban any gifts of any kind from drug and device makers to doctors.

The state of Massachusetts now has a law on the books that requires firms to report gifts to doctors that are valued at more than $50 and requires reports on any consulting fees. A piece of federal legislation, the Physician Payment Sunshine Act of 2007, has crawled through the legislative time tunnel to become a new bill by the same name with the exception of the date (Medical Device Daily, Jan. 26, 2009). That bill features many of the same prohibitions that are widely sought for disclosure, but the portion of the federal bill that would pre-empt state law, as it turns out, pre-empts only state laws that impose a lower threshold for reporting. Hence, there will be no national standard, as drug and device makers have sought. The Physician Payment Sunshine Act of 2009 has a threshold of gift reporting of $100.

The Minnesota law, dubbed the Pharmaceutical and Medical Device Gift Ban, was penned last year by Sen. John Marty and would impose an outright ban for gifts to doctors. Observers of events in the state capital apparently expect the Minnesota bill to be reintroduced next month. The bill would also require disclosure of all fees and medical conference sponsorships by drug and device makers. The effort by the state of Minnesota is especially ironic, given that the state is home to several of the most well-known device makers, including Medtronic (Minneapolis) and cross-town rival St. Jude Medical (St. Paul, Minnesota).

At press time, the Advanced Medical Technology Association and the Medical Device Manufacturers Association (both Washington) had not responded to contact for comment.

Specter wants NIH budget boost

Sen. Arlen Specter (R-Pennsylvania) has not endeared himself to conservatives of late with his advocacy of the economic stimulus package in the Senate last week, but reports indicate that Specter got his pound of flesh in the form of a $10 billion boost to the annual budget for the National Institutes of Health.

Specter, who has survived cancer and heart disease, has championed NIH for several years, but reports as to whether he traded his vote on the stimulus package vary. The Feb. 13 edition of the New York Times reports, "in return for providing one of only three Republican votes in the Senate for the Obama administration's $787 billion economic stimulus package," Specter obtained a boost in NIH funding from about $30 billion to almost $40 billion. However, he is also quoted as saying "I really do not make deals."

The House stimulus bill included a boost to the NIH budget of $3.4 billion, but the Senate prevailed in conference. Of the $10 billion, roughly $2 billion will go toward updates and improvements at NIH's main campus in Bethesda, Maryland, and the balance is said to be applied at the discretion of the NIH director. Raynard Kingston, MD, is the acting director of NIH.

Specter is said to have made the case that cancer could be cured if the U.S. government managed to come up with $335 billion for research, and was quoted in the NYT article as saying, "I think it's scandalous that we haven't done more to cure cancer." According to the National Cancer Institute's web site, Congress appropriated $4.84 billion for NCI in 2006, slightly more than double the sum of $2.38 billion in 1997, the year that served as the baseline for the doubling of the NIH budget that commenced during the second term of President Bill Clinton. The NIC site offers no comparable appropriations data for 2007 or 2008.

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