Issue link: https://beckershealthcare.uberflip.com/i/240733
Spine Device & Innovation 19 Can Spine Device Start-Ups Still Survive? By Heather Linder T he medical device market has been turned on its head over the last five years as regulations have increased and venture capital funding has dried up. Spinal device manufactures now face myriad obstacles to maintaining profitable and innovative business, including a 2.3 percent medical device tax, instituted in January 2013 to pay for portions of the Patient Protection and Affordable Care Act. To cope with these challenges and prepare for the future, large device companies have begun acquiring smaller companies and product lines. In September, Stryker purchased MAKO Surgical for $1.65 billion. In October, Wright Medical announced its acquisition of French orthopedic device company, Biotech International, and Biomet announced its acquisition of Lanx. And while the American Association of Neurological Surgeons and other medical groups are continuing to lobby Congress for an appeal of the medical device tax, for the time being it will continue to take its cut directly from the revenue of device companies. In this increasingly tight environment of market giants, can device start-ups still survive? Maybe, say Scott Spann, MD, and Jason Blain, president of Spinal Elements, but only if the companies can adapt to the changing environment and properly prepare for the uncertain future. Dr. Spann is the founder of Westlake Orthopaedics Spine & Sports in Austin, Texas. In 2007 he founded Pantheon Spinal to produce lateral access lumbar spine surgery implants and devices. Carlsbad, Calif.-based Spinal Elements was started in 2003 by Mr. Blain and Todd Andres under the original name Quantum Orthopedics. Spinal Elements' founders got the company off the ground and have maintained and grown its success, even in the face of mounting challenges. Though not running a start-up any longer, Mr. Blain has an up-close perspective of what small-to-midsize companies must overcome to succeed. Dr. Scott Spann Unexpected challenges Of the many hurdles Dr. Spann faced in the infancy of his company, the bureaucratic burden was even greater than he expected. Medical device laws and regulations are continuously shifting, creating a moving target for companies to keep up with. Jason Blain "Simply getting an FDA approval on an implant has been far more tedious than I ever anticipated, and I anticipated a great deal of tedium," he says. The increasing length of time for an FDA approval also forces companies to be more diligent with data provided and resources allocated, Mr. Blain says. Any company with limited resources can only afford to dedicate them to the most significant devices. AnticipAte chAnge. We do. the ASc Revenue cycle. It's all we do. It's all we think about. And it shows. Named one of the world's best outsourcing service providers two years in a row. – Fortune Magazine 2013 2013 ® 636.273.6711 | www.nationalASCbilling.com