September 6, 2005
Device makers vie in pain treatment market
By Susan Kelly
CHICAGO (Reuters) - Medical device makers are battling in
the fast-growing market for implantable systems that manage
debilitating pain in patients for whom medical alternatives,
such as drugs or spine surgery, have failed.
The devices, about the size of a pager, are typically
implanted in the abdomen or buttocks and block the sensation of
pain by sending electricity via an insulated wire to the spinal
Medtronic Inc., Boston Scientific Corp. and Advanced
Neuromodulation Systems Inc. all have recently launched
products that improve on earlier models because their
rechargeable batteries mean that a patient can go longer before
replacement surgery is needed, in some cases as long as seven
to nine years.
The latest generation of devices also allow patients, using
a remote control programed by the physician, to have more
control over how much and when the pain-blocking electrical
pulses are delivered.
Medtronic, which pioneered pain management technology a
decade ago, remains the largest competitor in the sector but
has conceded some ground as rivals stepped up production of
rechargeable devices in recent quarters.
"We continue to be the market leader, but we didn't have
competition before, so obviously we've lost some (share)," said
Jake Vander Zanden, Medtronic's general manager of pain
management, in an interview.
The stakes are high. Sales of the stimulation devices now
top $500 million and could exceed $1 billion in a few years,
company executives said.
The segment's smallest player, Advanced Neuromodulation,
saw sales of its neuromodulation products, including spinal
cord stimulation systems, leap 26 percent in the second quarter
when it rolled out its rechargeable Eon pain device.
The Dallas-based company said it would boost manufacturing
capacity after early sales of the product "significantly
Boston Scientific, for its part, believes its rechargeable
spinal cord stimulation device, called Precision, launched in
April, is also taking market share from Medtronic, said Jeff
Greiner, president and co-chief executive officer of the
company's Advanced Bionics unit.
"When you have a monopolist that dominates the field for
many years, there is an underlying feeling that competition is
good for patients," Greiner said in an interview.
Analysts said a shortcoming of Medtronic's Restore product
is that it lacks technology that would allow it to be used as a
replacement device for patients who need an older model
removed, but the wires leading to the spine kept in place.
"I think Boston Scientific and ANSI have the better
technology now, especially with the rechargeable," said Jeff
Jonas, analyst with Gabelli Asset Management Inc., which owns
less than 1 percent of Medtronic's shares.
Vander Zanden said Medtronic offers the widest range of
pain management devices on the market and said the company is
working on two products, an extension and an adapter, that will
help solve the replacement issue.
The extension product is expected to receive regulatory
approval "any day," he said, allowing the company to better
compete in the replacement market, which he estimated at 10
percent to 30 percent of all procedures. The adapter, he said,
is in the design phase.
The three rivals also are studying a host of potential new
applications for the devices in hopes of eventually adapting
the technology to treat conditions such as migraine headache.