Medtronic’s Spine Business Soft Compared to Other Units

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Device maker, Medtronic Inc., just announced company-wide increased net income; however, its spine division is seeing some sagging business

Medtronic, which manufactures implantable heart devices, insulin pumps, and spine surgery products posted overall net income of $902 million for second-quarter, fiscal year 2014, ended October 25th, according to The Memphis Daily News. This translates into a 40 percent increase year over year. Second-quarter revenue was recorded as a total of $4.2 billion, which is a 2 percent increase over the prior year’s $4.1 billion.

“Our Q2 revenue growth was in line with our outlook for the year, and we’re performing at or better than the market in almost every one of our business lines,” said Omar Ishrak, Medtronic chairman and chief executive officer, according to The Memphis Daily News. “Q2 also represents another quarter where our organization delivered balanced growth, with strong performances in some areas offsetting challenges in other parts of our business,” Ishrak added.

In fact, the device maker enjoyed quarterly revenue growth in three of its key business units—its Diabetes Group, its Restorative Therapies Group, and its Cardiac & Vascular Group. Each group, noted The Memphis Daily News, saw between 2-4 percent growth for the quarter.  “Looking ahead we are confident that our three primary strategies: therapy, innovation, and globalization in economic value will position us well to thrive in the transforming health care environment,” Ishrak said.

Medtronic’s Infuse Bone Graft sales have taken hits following revelations over the way in which it handled the product’s studies and marketing, according to The Memphis Daily News. That product area is in the company’s Restorative Therapies Group.

The controversial bone graft product is a synthetic, or genetically engineered, recombinant human Bone Morphogenetic Protein (rhBMP-2) that was approved by the U.S. Food and Drug Administration (FDA) in 2002 for specific uses. Infuse was designed to stimulate spine growth in patients suffering from lower spinal degenerative disease. Infuse was approved for use in one type of spinal surgery and some dental procedures; the product is not approved for use on the upper, or cervical spine, although Infuse is widely used in off label procedures.

On July 1, 2008 the FDA issued a notification warning about Infuse’s ties to serious complications when used in cervical spinal fusions.

Infuse has been the focus of growing controversy and there are concerns over the way in which Infuse research was conducted, including that the research was Medtronic-funded. Medtronic has been accused of promoting Infuse off label, of downplaying the device’s risks, and of overstating Infuse benefits. These accusations have led to a Senate probe, the FDA warning, and independent studies.