Recognizing Our Failures
The neurotechnology industry has seen its share of commercial successes in recent years. There have also been a few failures. One of the most significant that we have witnessed is the Chapter 11 filing by Nuvectra Medical earlier this month [see article, p3]. Though it was at best the number five player in the spinal cord stimulation market behind Abbott, Boston Scientific, Medtronic, and Nevro, Nuvectra possessed considerable engineering and marketing skill, much of it garnered from the company’s roots as a unit within Greatbatch, the firm launched by medical electronics pioneer Wilson Greatbatch.
Some critics of Nuvectra have cited management problems and quality control issues with its Algovita device as factors leading to the filing. Fred Parks, a medical device industry veteran with little experience in the SCS market, took over for founding CEO Scott Drees in January. Others have pointed to problems managing the company’s suppliers and an overly burdensome agreement Greatbatch required as part of the spinoff.
There is still an opportunity for a larger medical device firm to take over some or all of Nuvectra’s assets, including its Algovita SCS device or its Virtis SNS system, and it’s not out of the question that the firm could emerge from Chapter 11 as a viable player in the neuromodulation market. But it is still sad to see the current state of affairs at Nuvectra given the potential it had when it first emerged.
Nuvectra was not the only commercial neurotech failure this year. EndoStim, a European bioelectronics firm targeting digestive system disorders, closed down as a result of a failed clinical trial in which the control arm experienced positive results—an outcome that we have seen far too often in this space. Autonomic Technologies, Inc., a Bay-area firm that offered a very promising minimally invasive therapy for migraine, appears to have vanished from the scene. Although the causes are not publicly known, some insiders have pointed to problems with European regulatory bodies as a potential root. And earlier this year, Retina Implant AG closed its doors, citing an “innovation-hostile” regulatory climate as well as negative trial results as causes [NBR Apr19 p4].
While these four neurotech company failures stand in stark contrast to the numerous financial and clinical successes our industry has seen in recent years, it’s important for new market entrants and existing players alike to learn as much as they can from them. Certainly spending the time to set up and administer a pivotal clinical trial—including a full understanding of the control arm—stands out as important. So does maintaining an open and ongoing dialogue with regulatory agencies. Hopefully, we’ll have fewer of these stories to report on in the future.
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