Medical Device Daily Executive Editor

SAN FRANCISCO Two firms involved in minimally invasive spinal solutions captured the attention of many of the dwindling number of attendees on hand for the final day of last week's 24th annual JPMorgan Healthcare Conference here.

Relative newcomer St. Francis Medical Technologies (Alameda, California) was consigned to the nether reaches of the Westin St. Francis Hotel meeting space, the Elizabethan C&D space, but thanks to a cancellation in the original presentation schedule, Kyphon (Sunnyvale, California) got a chance to strut its stuff in the premier Grand Ballroom locale, and Richard Mott, president and CEO of the developer of an innovative solution to spinal fractures, took full advantage of it.

Mott said Kyphon's approach represents “an incredible opportunity in the medical device space,“ adding that the company “was founded on the premise that we could revolutionize the practice of spinal medicine.“

Kyphon's primary product, the KyphX system, is directed toward restoring spinal function via balloon inflation of creating a void in spaces where spinal disc compression has occurred due to osteoporosis, trauma or cancer. That void is then filled with a bone cement to restore at least a portion of the lost height in the region.

The kyphoplasty procedure, as the technique is known, has earned a substantial following among spinal surgeons as what Mott characterized as “Band-Aid surgery for internal fixation“ of such decompression.

But, with just some 57,000 kyphoplasty procedures now being conducted among the just short of 1 million potential annual procedures (700,000 due to osteoporosis, 150,000 caused by cancer and 100,000 by trauma, according to Kyphon estimates), Mott said “there's plenty of room for growth“ in the $213 million in annual revenues racked up by the company.

“This is a truly safe procedure with significant long-term outcomes,“ he said, citing new data published this month in the journal Spine. That study, which featured two-year follow-up on 77 patients, showed that 90% of those treated via kyphoplasty reported complete pain relief, while 88% were “fully ambulatory.“

Most importantly, there were no kyphoplasty-related complications, Mott said.

He cited other data from recent German studies indicating a low rate of subsequent fractures and no progressive height loss, the latter a particularly important measurement of both the success and longevity of the procedure.

That study focused on both kyphoplasty and vertebroplasty, another minimally procedure developed by competitor Arthrocare (also Sunnyvale), but Mott said kyphoplasty-related complication rates were lower than were those for vertebroplasty.

Still touching on clinical trial issues, he said Kyphon had recently completed enrollment in the 300-patient, multi-center FREE trial in Europe, which he said would be “a landmark study.“

Mott noted that enrollment continues in the planned 200-patient CAFÉtrial in the U.S., a study involving repair of cancer-related fractures, as well as in the planned 100-patient INSPIRE trial, which is focused on pulmonary function and on which enrollment began last September.

He also cited three other studies, including a Japanese trial involving osteoporotic fractures, in which six of a planned 81 patients have been enrolled to date. “This gets us started on our Japan commercialization effort,“ Mott said. He added that enrollment in the KYPOHOS(x2) osteoporotic/trauma trial in Europe is expected to begin this fall.

The 1,200-patient KOVIAR (Kypholasty and Vertebroplasty in the Augmentation and Restoration of Vertebral Body Compression Fractures) is being aimed toward a 4Q06 start.

Noting that Kyphon has 260 U.S. sales reps and 85 “and growing“ in Europe, Mott said that some 3,000 U.S. hospitals “have the capability to do this procedure, and we're roughly 50% penetrated“ in that market.

He said the company would have direct distribution of its products upon their approval in Japan. “We want to own the approval and not dilute the revenues from them through distributors,“ Mott said, adding the Kyphon anticipates beginning commercial sales in that country in 2008.

Kevin Sidow, president and CEO of St. Francis Medical, was no less enthusiastic about prospects for his company and its X Stop Interspinous Process Decompression (IPD) System. He termed the X Stop treatment for lumbar spinal stenosis (LSS) “the right combination at the right time.“

After more than a year-long delay following an FDA panel turndown, the X Stop system finally received approval from the agency last November (Medical Device Daily, Nov. 28, 2005). In a 5-3 vote in late 2004, the Orthopedic Rehabilitation Devices Panel of the FDA's Medical Devices Advisory Committee voted against recommending approval of the X Stop system, even though many of them praised the device's “innovative design.“

While the system had achieved its primary effectiveness endpoint, the panel members were apparently not convinced by the study data. And though they said they thought it was safe, they focused on discrepancies in trial data. In some ways, the delay ended up being a good thing for the company, Sidow told MDD at the time of the approval.

“We felt like we took advantage of the delay,“ he said. “Certainly the awareness of the product in our situation has grown since the turndown 15 months ago, and I think we're in a much better position to take this to surgeons and have them make this part of their practice.“

The system has been approved for sale in Europe and Japan since 2001, and has been successfully implanted in more than 4,000 patients, according to the company.

St. Francis, founded in 1997, has billed the IPD system as a “middle-of-the-road measure“ between non-surgical treatment and the much more invasive lumbar laminectomy. A laminectomy relieves pressure on the spinal cord or spinal nerve by widening the spinal canal via removal or trimming of the lamina or roof of the vertebrae to create more space. The procedure also may involve fusing vertebrae or removing part of a disc.

“Unlike laminectomy, the X Stop procedure does not require general anesthesia, making it a more viable option for those with lumbar spinal stenosis who cannot tolerate general anesthesia as a result of their age or other health conditions,“ said James Zucherman, MD, co-inventor of the X stop and medical director of St. Mary's Spine Center (San Francisco). “This new procedure fills a gap in the continuum of care that, until now, required patients to make the leap from conservative therapies, such as analgesics and injections, straight to invasive surgery.“

The small, two-piece non-fusion titanium device is inserted through a small incision while patients lie on their right side in a fetal-like position. Since the X-Stop is placed outside the spinal canal, no bone or soft tissue must be removed. The procedure requires only local anesthesia and takes less than an hour.

Sidow told his JPMorgan audience that 96 out of 100 patients who undergo the IPD procedure are out of the hospital in 24 hours. “It has a very low risk profile,“ he added, calling it “a simple solution for degenerative spine patients.“

He said the X Stop system and IPD procedure “mimic what happens in the flexion [sitting] position,“ which is where patients find the most relief from their pain.

Noting that St. Francis Medical functions in a “large and growing space,“ he cited a total of 2.3 million suffering from spinal decompression, adding that “80% of patients are not getting better.“

Saying that just over 200,000 LSS patients are candidates for the IPD procedure, Sidow said that results in a market valued at some $1.6 billion. So far, the company is marketing its product to spine surgeons in 16 countries.

“This will be a product empowered patients will gravitate to,“ he said, adding: “There is a strong interest in less-invasive procedures by both physicians and patients.“

While it's a field that is attracting a number of competitors, he said St. Francis Medical expects “strong and sustainable sales,“ and said “we're confident this will become the standard of care in the U.S.“

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