2005 in Review
The year 2005 was a banner year for the neurotechnology industry in many respects. Overall, financial performance of both public and private companies trended in the direction of black ink. There were a large number of new products receiving FDA approval during the year. Plus there were several healthy mergers and acquisitions and several startups in the space obtained venture-capital funding during the year.
Certainly the most significant financial development of 2005 was the acquisition of Advanced Neuromodulation Systems by St. Jude Medical in a $1.3 billion deal [NBR Oct05 p1]. Though perhaps overshadowed by that merger, other noteworthy deals were Medtronic’s purchase of Transneuronix and Natus Medical’s merger with Bio-logic Systems. Though the multi-billion dollar deals like the ANSI acquisition dominate the landscape, the smaller ones are important too, if for no other reason than demonstrating to investors a path to liquidity for startups in this space. And the numerous cooperative agreements and collaborations that neurotech firms enter into are a sign for all observers of the industry’s vitality.
Another notable trend in 2005 was the continued forays of orthopedic industry players into the neurotechnology space. Encore Medical, with its purchase of Compex Technologies [NBR Nov05 p1] complementing its prior acquisitions of Empi and Chattanooga Group is one example, as is Otto Bock’s purchase of Neurodan [NBR Apr05 p4]. These two firms join Hanger Orthopedics, which set up a neurotech unit called Innovative Neurotronics, and Ossur, which is developing neural prostheses with Victhom Human Bionics.
Notable startups of 2005 include Andara Life Science Inc., which is developing a spinal cord regeneration stimulator, Medtrode Inc., which is developing novel DBS electrodes, NeuroSystec Corp., which is developing a device to treat tinnitus, and BioNeuronics Inc., which is developing unspecified neurostimulation technologies. The latter firm secured $6 million in funding [NBR Jan05 p3].
On the new product front, the FDA’s long-awaited approval of Cyberonics' VNS system for treating treatment-resistant depression stands out as significant, as does the heightened competition in the DBS and spinal cord stimulation markets.
Though these were all noteworthy events, there are most likely several other firms, products, and researchers that deserve recognition for their accomplishments in 2005. As we have in the past, we encourage our readers to nominate individuals and organizations for a Gold Electrode Award, which our editors will select in the coming month. Email your nominations to email@example.com by January 16, 2006, for it to be considered.
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