Medical Device Daily
A relatively new company is elbowing its way into the huge orthopedics market with a unique twist on three products for spine and long-bone fracture treatments to be launched later this year. Just because the economy is down or the fact that the orthopedics market is the biggest sector in medical devices doesn't mean there isn't room for one more player to step up to the plate, according to a confident CEO.
"It's fair to say that there are opportunities for others to play in this space," Bill Christy, president/CEO of AOI Medical (Orlando, Florida), told Medical Device Daily.
That this company in 2007 successfully floated an initial public offering on the London Stock Exchange AIM (an international market for smaller companies), is proof it-s nimble and creative – possibly an indication of AOI's promise to succeed.
"It's fair to say the window of opportunity opened and closed around us," Christy said. "We targeted raising $20 million and got $8 million."
It was enough to bring to center stage the company's first product offerings:
• Ascendx VCF Reduction System – a set of tools to treat compression fractures.
• Motion Preserving Cervical Dynamic Stabilization Plate – an artificial ligament for use in spine surgery.
• Balloon Assisted Management of Trauma Fractures (BAMF Trauma) – a removable, inflatable rod for treatment of long-bone fractures.
Ascendx is a product built on the rapid development and use of kyphoplasty procedures, which seeks to fix spinal compression fractures by restoring the height and angle of the vertebra and then it's stabilized with injection of a bone cement.
"Pumping cement into the cracks and crevices means it can spider to the cracks," Christy said, adding that danger exists in potential for the cement to leak to other places such as the lungs. "We can do it better."
The Ascendx cutting device creates a cavity in the spongy bone into which an expandable fracture reduction device is inserted. It restores height to the bone while simultaneously delivering cement, uniformly filling the cavity, allowing for more equal distribution to the vertebra.
Kyphoplasty typically requires two incisions into the vertebra, doesn't provide equal force load distribution and puts other vertebra at risk. AOI's procedure allows for just one incision – a key to making it more minimally invasive and offers more uniform distribution of the cement.
Last June, AOI started a 60-patient clinical trial designed to evaluate the safety and efficacy of Ascendx. By October, 10 patients had undergone procedures using Ascendx. The trial is expected to be completed in mid-2009. If the news is positive, commercial launch could come at the end of the year.
AOI is focused on this space within the orthopedics sector particularly because the market has grown dramatically to $700 million with about 900,000 kyphoplasty procedures performed each year, Christy said.
Then there is AOI's Cervical Plate, which is made of biocompatible synthetic polymer that permits natural movement and flexibility. It's an anterior artificial ligament that joins bone to bone, allowing for rotational stabilization at the site of an intervertebral graft, implant or prosthesis following a cervical spine surgery.
The company's third offering, the BAMF Trauma product, is used to temporarily stabilize fractures including the upper arm, forearm, collarbone as well as long bones of the legs. Christy said it is differentiated from current "nails" on the market because it's made of a stainless steel rod inside of a balloon made of high-tensile polyethylene terephthalate. The balloon is deflated, the device is inserted into the intra-medullar canal of the fractured bone. After it's in place, the balloon is then inflated to stabilize and anchor the bone, allowing it to set in an ideal healing position. Later, it's removed.
The worldwide orthopedics market was valued at $16.2 billion in 2007, according to the Orthopedics: Global Industry Guide report by Datamonitor (London), and that number is expected to rise to $22.9 billion by 2012. Given that spine implant sales account for about one-third of the orthopedics market, there may indeed be room for another, innovative player.
And although AOI raised funds in the UK, its efforts are focused on the U.S., since the U.S. comprises almost two-thirds of the market's sales.
Christy said the company has enough money to take it through to commercialization but will then seek additional funding to power this new company and its new products.
The potential rewards could be huge. The company estimates the market size for Ascendx to be $700 million, $500 million for the cervical plate and $900 million for BAMF Trauma.
Given that the population is aging and because osteoporosis is a primary cause of vertebral compression fractures, Ascendx alone targets a market ripe for the picking. Especially since Kyphon (Sunnyvale, California), now a unit of Medtronic (Minneapolis), is the sole competitor for minimally invasive spinal compression fracture management products.