Cyberonics (Houston), developer of vagus nerve stimulation (VNS) technology, is rather familiar with regulatory and market difficulties. After an FDA panel in 2004 recommended against approval of its VNS system as a therapy for treatment-resistant depression (TRD), it waged a long battle to win agency approval, fighting that battle against both FDA insiders and the psychiatric industry that depends largely on treating depression with drugs rather than devices. Many thought that the approval was won as the result of the persistence – always rather vocally expressed – of its president/CEO Skip Cummins, who doesn’t shrink from explaining what he feels is the therapy’s benefits for depressed individuals who have run out of options.
But since approval of VNS for TRD, the difficulties continue. Market uptake of the technology has been slow, made more difficult by resistance to reimbursement by Medicare and non-governmental insurers. And over the past two months the hurdles have gotten steeper, with the company facing an increasing amount of criticism, despite what it calls a steady stream of endorsements for the TRD application.
The criticisms it is facing are both internal and external. A group of Cyberonics shareholders last month issued a statement citing a “series of bad decisions” by the company’s management and board and they have launched a campaign to place three of their nominees on the company’s board, ostensibly to influence a change in company direction. Additionally, the company faces delisting by the NASDAQ, due to a failure to file financial reports with the Securities and Exchange Commission for the quarter ended July 28. The delay is the result of an investigation by the commission into the company’s stock option practices, primarily to Cummins.
Additionally, the group Public Citizen (Washington), has begun a public campaign challenging the company’s claims for the benefits of VNS therapy to treat depression. Following a statement from Public Citizen arguing that the approval of Cyberonics’ system for treatment of TRD should be revoked, Cyberonics issued a lengthy statement in support of its attempt to seek CMS reimbursement, saying that those comments offered overwhelming endorsement of the therapy.
In the statement, Shawn Lunney, vice president of market development for Cyberonics, reports that CMS received more than 1,300 comments supporting “qualified psychiatrists and fully informed patients,” access to VNS therapy for TRD and fewer than 10 negative comments. That support, he said, came from “more than 250 psychiatric thought leaders and psychiatrists; 175 other healthcare professionals including neurologists, surgeons, nurses, social workers and psychiatrist; 175 other healthcare professionals including neurologists, surgeons, nurses, social workers and health economists; more than 650 TRD patients and family members, some 40 patient advocacy organizations ... and some 20 Senators and Congressmen.”
The statement also cites figures from the company’s database to collect what it called “long-term” results of early post-approval experience with VNS therapy for TRD, and that this data showed that for 50 TRD patients after three months of VNS therapy, “an average of 30% of patients were rated as much or very much improved across six functional outcomes. In addition, 34% of patients had a decrease in their antidepressant medications, 96% of patients had no ECT and 90% of patients had no hospitalizations in their first three months of treatment ... ”
Unconvinced is Dr. Peter Lurie, deputy director of health research for Public Citizen. Cyberonics’ statement “doesn’t do anything for me,” he told Biomedical Business and Technology, saying it lacked any science or real scientific rigor. As to the supporting comments Cyberonics has garnered, he said, “hopefully, this entire thing will be resolved on the basis of science, not on the basis of some popularity contest.” He said that those lauding VNS therapy for TRD are providing their stories, but “this shouldn’t be resolved on the basis of anecdote – either anecdotes from patients who believe the device helped them or from doctors who have talked to them.
“This should be a scientific contest, and the company has already lost the most important contest, the contest of its device against, the comparative effective of the device compared to placebo.” The company’s own studies indicate, he said, that the therapy was no better than placebo.
Adding to the scrutiny of the company, The New York Times printed a lengthy discussion of the company and its battle to promote the application for depression. The story suggested a largely negative experience with the therapy, since most of its key details concerned a female patient who suffered setbacks after implantation with the device and eventually had it removed. Following explant, she felt like she was “beginning to get my life back,” she told the Times.
Lurie said he was as little convinced by the negative anecdotes as he was by those on the positive side, saying that the pudding’s proof should be “a long-term, placebo-controlled clinical trial – that’s what’s needed.” Such a trial should be done, he said, by an independent source, reiterating previous charges that a trial conducted by the company is flawed and that positive write-ups of the therapy have largely been “ghost-written.” Lurie contended that the apparent broad show of support for use of the VNS treatment of TRD indicates only a wish for “more choices.”
Meanwhile the stockholders seeking a change in company direction – and representing 7.33% ownership in the company – said in a letter that they are “steadfast in our commitment to see these [three] nominees elected to the board of Cyberonics. If there was ever a question about the need for change at Cyberonics, recent events have provided an emphatic answer. We believe that Cyberonics has a valuable franchise and enviable market position. However, that value has been masked due to the lack of credibility of senior management that consistently over promised and under delivered, and by a board that continually rewards such behavior with ever increasing compensation.”
St. Jude consolidating cardio units
St. Jude Medical (St. Paul, Minnesota) said it is combining its Cardiac Surgery and Cardiology divisions to create a new Cardiovascular division, effective Jan. 1. The company said the new division will focus on bringing to market medical device technology and services to help patients who suffer from vascular disease or structural heart defects. It will incorporate the activities currently managed by the Cardiac Surgery and Cardiology divisions, although the company said it will continue to have specialized cardiac surgery and cardiology sales forces.
Company spokesperson Angela Craig said that as a result of the consolidation, the company has determined that 30 employee positions represented redundancies between the two divisions and consequently, those positions “regrettably” would be eliminated, and some employees would be given added responsibilities.
Daniel Starks, president/CEO and chairman of the company, in a statement, said, “By streamlining our organization, we can boost operating efficiencies and ultimately use the associated savings to invest in research and development. This in turn is expected to strengthen our competitive position and improve St. Jude Medical’s total growth profile both in cardiology and in cardiac surgery ... .”
Starks said that the creation of the new division, coupled with the expansion of the two units’ respective sales forces and recent new product introductions, are part of a comprehensive program to position St. Jude Medical “to deliver a minimum 15% growth in 2007 and beyond.”
Cramer Decker launches MERET division
Cramer Decker Medical (Santa Ana, California) reported the launch of a new products division focused on the development of emergency medical equipment for first responders. The products, brand-named MERET (for Medical Emergency Rescue Equipment and Technology), will focus on providing first responder products “that meet the demands encountered when saving lives,” Cramer Decker said.
“We have taken great care and time in developing unique equipment that is well-organized, easy to use, and extremely rugged,” said Scott Decker, company president. “Our products are designed around ease of transport and easy access to ALS and BLS supplies so that the first responder can focus on their difficult tasks.”
Decker said, “Our unique TS-Ready interchangeable ALS/BLS bag system is a great example of the thought we have put into our design process. All of the bags can be expanded and interchanged to fit the dynamic requirements of the first responder.”
Medtronic must make Fridley corrections
Following receipt of a warning letter from the FDA, Medtronic (Minneapolis) last month said it will have a plan to correct quality-system problems with two of its drug-pump catheters. In July, Medtronic took 934 drug-pump catheters off the market after receiving 22 reports of catheter tips dislodging in patients’ spines. Federal regulators designated the action a Class I recall because the dislodgement of the tip could result in the risk of infection or other serious health problems. In one case, the tip detached in a patient’s leg, the FDA said.
In a letter dated Aug. 29, the agency said that the company repeatedly had failed to comply with manufacturing standards, that conclusion based on inspections conducted in May and June at the company’s Sullivan Lake facility in Fridley, Minnesota. Medtronic sent the agency a plan to correct some of the manufacturing flaws during July, but it has not followed up with additional information, the FDA said.
The devices consist of a pump that is placed in the abdomen and a connected catheter that is inserted into the spinal canal and tunneled under the skin, according to the company website.
Medtronic recalled all unused Model 8731 intrathecal tip catheters and a related Model 8598 kit made on or before August 2004. Implanted devices were not included in the recall. It sent a letter to doctors, saying that there were 22 reports of the platinum-iridium tips on its catheter dislodging inside patients.