Metal-on-Metal: An Implant at the Crossroads

Metal-on-Metal: An Implant at the Crossroads

Joshua J. Jacobs, M.D., cannot fully explain his aversion to metal-on-metal hip implants. More than a dozen years ago, well before problems with thesedevices began to surface, Jacobs favored artificial joints made of metal and highly crosslinked polyethylene.

“At the time, the highly crosslinked polyethylene is where I thought the industry was going. It’s where my instincts led me,” Jacobs said during an expert roundtable discussion with journalists during this year’s American Academy of Orthopaedic Surgeons Annual Meeting in San Francisco, Calif. “I had no idea back then that I would someday be sitting in a room talking about what was going on with these implants. I had no idea that would happen.”

Neither did the creators of metal-on-metal hip replacements, which have become the proverbial black sheep of implant choices as controversy grows over their potential health hazards. The failure rates of metal-on-metal hips and concerns about the gradual buildup of wear particles in the body have prompted many patients to rethink their decision to undergo joint replacement surgery with all-metal implants. Such hesitancy has led to a sharp decline in the number of metal-on-metal joints used in replacement surgeries; before they fell out of favor, all-metal implantsaccounted for nearly one-third of theestimated 250,000 hip replacements performed annually in the United States. About half a million patients have received metal-on-metal replacement hips, according to one estimate, though more precise figures are difficult to ascertain due to the lack of a national implant tracking system.

Though he prefers implants made from metal and highly crosslinked polyethylene, Jacobs was fair in his assessment of all-metal hip replacements, noting that most patients with the devices are satisfied with their choice. He also warned againstclassifying all metal-on-metal hip implants as “one group,” telling reporters that the joint replacements vary by size, design andspecific features.

“It’s very perilous to talk about metal-on-metal implants as one group,” Jacobs told a dozen journalists at his roundtable discussion. “It’s a very heterogeneous group. If you bunch them all together, you miss the nuances…metal-on-metal [hip implants] can have large heads, they can have small heads, they can be designed for a hip resurfacing or they can be designed as a total replacement.”

And every design from orthopedicdevice companies has its own unique features, which can impact the way the product performs, Jacobs noted.

“In general, there are some devices that have performed very poorly and have been removed from the market. Others have done very well. Even with the worstdesigns, the majority of patients still have good results from their surgeries,” saidJacobs, who is incoming first vice president of the American Academy of Orthopaedic Surgeons and an adult reconstructive surgeon at Rush University Medical Center in Chicago, Ill. “The majority of patients with these [metal] implants are doing quite well, but the failure rates are very disappointing and as orthopedic surgeons we are not happy about those rates. When there is a failure from an implant, we feel it, the patient feels it and the system feels it.”

The system is about to feel it in a big way, too.

All-metal hips have been failing at surprisingly high rates in recent years, giving out within one or two years of the original procedure. Hip implants are designed to last 15 to 20 years but the wear of metal parts sometimes can generate debris that damages soft tissue and bone, crippling patients and forcing them to replace (or in certain cases, revise) the implants.

Implant durability can vary depending on the materials used. For example, highly crosslinked polyethylene is used lessfrequently for joint replacements but has been shown in a laboratory setting todecrease wear by about 94 percent, including a substantial reduction in pitting and delamination.
Ceramic-on-ceramic hipreplacements produce fewer wear particles, but can produce an irritating squeaky noise during use. A fairly recent study (released last year) concluded that artificial hips and knees developed within the last five years are not significantly better than olderdevices; 30 percent, in fact, were considered worse than their earlier counterparts.

It is one of the older models that has become a source of controversy for the industry, though. Eighteen monthsago, Johnson & Johnson’s DePuy Orthopaedics unit recalled its ASR XL Acetabular System, a hip socket used in traditional replacement surgery, and the ASR Hip Resurfacing System, a partial hip replacement that involves placing a metal cap on the ball of the femur in order to preserve more bone.
The company reportedly recalled both products due to the number of patients who needed a second hip replacement.

Many of those patients are now suing DePuy (some industry observers have estimated that as many as 3,500 patients have filed suit against the company). The lawsuits, in turn, have ignited a financial scramble as patients attempt to recover lost wages and pay off astronomical medical bills, insurers try to regain their expenses from settlements and Medicare fights for its fair share. Medical and legal experts estimate the hip failures may cost taxpayers, insurers, companies such as DePuy and others billions of dollars in coming years, contributing to the skyrocketing cost of healthcare. The financial fallout is expected to be unusually large and complex because the controversy over metal-on-metal hips involves a class of products rather than a single device or just one company.

DePuy would not comment on how much it had paid in recall-related costs. But spokeswoman Mindy Tinsley told The New York Times that the company is working with patients and insurers.

Along with ASR-related cases, DePuy also faces more than 560 lawsuits over the all-metal version of another hip model—called the Pinnacle. Since the model isperforming well, company executives have said that costs for its replacement are being borne by Medicare, insurers or by thepatients themselves.

To recoup their expenses, insurers typically notify patients through lawyers that they expect to be reimbursed from anysettlement money patients receive, rather than pursue their own lawsuits with the device makers. Also, Medicare is expected to enforce new laws sometime this year that will make it easier for the agency torecover taxpayer dollars spent treatingpatients injured by problem drugs andmedical devices, legal experts said.

Greatbatch Inks Deal for Specialized Design Firm

Greatbatch Inc. has acquired NeuroNexus Technologies for approximately $12 million in cash—including the assumption of debt and future considerations.

NeuroNexus, headquartered in Ann Arbor, Mich., is an implantable medicaldevice design firm specializing in developing and commercializing neural interface technology, components and systems for neuroscience and clinical markets.

According to Greatbatch officials, the company’s latest acquisition has“an extensive intellectual property portfolio, core technologies and capabilities to support the development and manufacturing ofinnovative neural interface devices across a wide range of functions,” including neuromodulation, sensing, optical stimulation and targeted drug-delivery applications.

“We are very excited to have theNeuroNexus team join the QiG Group and Greatbatch family of companies. Together, we believe that we can research, design, develop and manufacture new world class proprietary products and systems that will expand and potentially redefine the fields of cardiovascular and neuromodulation as we know them today,” said Thomas J. Hook, president and CEO of Greatbatch Inc. “Additionally, the strong allianceNeuroNexus has with the University of Michigan and the Michigan EconomicDevelopment Corporation should position us to expand our operations in the region.”

NeuroNexus, founded in 2004, employs approximately 25 associates in its Ann Arbor facility.

Clarence, N.Y.-based Greatbatch serves the medical device industry with three brands—Greatbatch Medical,Electrochem and the QiG Group. Greatbatch Medical develops and manufactures critical medical device technologies for the cardiac, neurology, vascular and orthopedic markets. Electrochem designs and manufactures battery and wireless sensing technologies for high-end nicheapplications in the energy, military, portable medical, and other markets. The QiG Group provides design and development of new medical devices.

Phillips Plastics Rebrands as Phillips-Medisize

What’s in a name? A lot, especially if you talk to executives from Hudson, Wis.-based Phillips-Medisize Corp. Previously Phillips Plastics Corp., the company changed its name as a result of its acquisition of Medisize Inc. last summer. In the deal announced in July, Phillips bought Finland-based Medisize for approximately $140 million from Ratos AB, aprivate-equity group based in Sweden.

Phillips-Medisize provides design and manufacturing services to the medical device and diagnostics, drug delivery and commercial markets. The company has annual sales of just under $500 million, with 75 percent of total revenue coming from drug delivery, medical device and diagnostic products such as disposable insulin pens, glucose meters, specialtyinhalation drug delivery devices, single-use surgical devices and consumablediagnostic components.

“This name change represents the culmination of much hard work by theemployees of both the Phillips Plastics and Medisize enterprises,” President and CEO Matt Jennings said in news release.
“The new name will take full advantage of the wonderful franchises that both these companies have built over the last 30-plus years. We will work with ourcustomers, regulatory agencies and suppliers over the ensuing months to effectively execute this name change.”

As a result of the new moniker, the company’s website also will change to phillipsmedisize.com. Both the medisize.com and phillipsplastics.com sites will remain active “for the foreseeable future,” according to the company.

Jennings sees this latest chapter in Phillips’ growth story as another opportunity to improve the manufacturer’s value proposition.

“If our OEM [customer] is focused on taking things from ‘bench to bedside,’ we want to be there working closely to help them take their products from the ‘bench to the distribution center, ’”Jennings told

Medical Product Outsourcing. “In terms of the stable of services that we would like to expand on, one is in the area of small electronics. We don’t manufacture the electronics, but we do the integration of small electronics into devices. That’s acapability we’d like to do more of as our customers continue make smaller and smarter devices. We’re doing very complex molding and automated assembly and manufacturing. Every day we’re solving new problems for our customers and we want to do more of that.”

Jennings also said that Phillips-Medisize plans to expand in Asia, most likely through acquisition, to meet increasing demands from the company’s customers. But he was careful to point out that the desire to expand in Asian markets isn’t for expansion’s sake alone. There’s acustomer-centric growth strategy at work.

“Our primary strategy is to maintain the very good relationships we have with our customers—design through manufacturing. Our goal is to grow with our customer, and they’re faced with three primary challenges,” he explained. “First, as they encounter slower growth in primary markets here in the U.S., they need to find growth opportunities. Second, as things slow down, they need to shorten and shore up their supply chain and make it more efficient. And third, as they look to allocate resources, they tend toallocate resources toward growth, and this is where we can be a significant help. We help with speed to market. In order for them to grow, they need to be able to continue to innovate. We help them

innovate. We want to help them shorten their supply chains as they consolidate, and we want to continue to invest in the expertise and resources that help them design, develop and industrialize their products. So as our customers look toinvest in Asia for their growth, we’relistening to that. The reason we need to look at these markets is because our customers are looking at these markets.”

Jennings said a prospective “solid” acquisition target in Asia has a high standardto meet.

“Our ideal candidate augments—like Medisize did—what we’re all about. Somebody who is involved and has good design, development and manufacturing capabilities in medical device, drug-

delivery and consumable diagnosticdevices,” he explained. “We’ll also look for [a company] that is technology-oriented and, culturally, puts the customer first. That’s a good fit.”

With more than 2,100 employees, the company has 19 locations throughout the United States, Europe and China, including design centers in Wisconsin, California and the Netherlands.

Globus and FDA Reach Million-Dollar Deal

The U.S. Food and Drug Administration (FDA) has reached a $1 million civil money penalty settlement with Globus Medical Inc., of Audubon, Pa., for the distribution of unapproved medical devices.

The settlement requires Globus to pay a $550,000 penalty and David C. Paul, the firm’s CEO, to pay a $450,000 penalty, for a total of $1 million.

During an inspection of Globus Medical in September 2010, FDA investigators learned that the company had marketed its NuBone Osteoinductive Bone Graft product without proper premarket approval or clearance, as required by law.

“The device-clearance process assures the quality and safety of devices before they reach the market. Firms can’t simply choose to sell devices that FDA has found are not safe and effective,” Steve Silverman, director of the Office of Compliance in the FDA’s Center for Devices andRadiological Health, said in a newsrelease. “We took action against Globus Medical to protect patients and we are pleased with the outcome.”

Globus Medical had sought clearance of its NuBone product in January 2009, but the FDA declined to clear the product after determining that it was not substantially equivalent (NSE) to legally marketed products. The FDA advised Globus Medical that it could not distribute the product, but the firm continued to do so, even after receiving the NSE letter in December 2009, the agency claims.

The FDA then filed a complaint for civil money penalties against Globus Medical and the company’s CEO for distributing the NuBone product without proper FDA approval or clearance. The agency informed Globus Medical and Paul of this action in November 2011, and later participated in settlement discussions which ultimately lead to the $1 million penalty agreement.

“This company ignored previous warnings by the FDA and continued to produce and distribute unapproved medical devices,” said Dara A. Corrigan, associate commissioner for regulatory affairs.
“By taking this enforcement action, the FDA is demonstrating its commitment to protecting the public from the dangers of unapproved devices.”

No patient safety issues were reported regarding NuBone, according toGlobus. Company officials also stressed that the settlement does not allege any intentional wrongdoing by Globus Medical or by Paul.

The company’s side of the story is that it had considered NuBone to be minimally manipulated tissue exempt from premarket notification, but in March 2008 the FDA’s Tissue Reference Group determined that NuBone required 510(k) clearance. Globus and FDA maintained an ongoing dialogue regarding NuBone’s regulatory status including two 510(k) submissions with substantial animal data. During that time, Globus executives claim they communicated regularly with the agency regarding NuBone and throughout the product’s lifecycle, and that they were acting in a manner that was acceptable to FDA.

Despite what company officials said was history of safe use, Globus decided to discontinue NuBone in 2010.

“Globus strives to conduct our business in a manner that is consistent with the highest legal standards in our industry. In this particular situation, there was an unfortunate miscommunication between Globus and FDA such that we believed we were acting in a manner that was acceptable to FDA,” Paul said in a prepared statement. “We accept full responsibility and are pleased to have resolved this matter without further legal action, and look forward to a continuation of our long standing relationship with FDA, based on cooperation and mutual respect.”