Globus Medical, Inc. received a Warning Letter on September 27, 2013, from the FDA over its MicroFuse Putty.
According to an October 15, 2013 Globus SEC filing, the warning came after an inspection at the company’s Audubon, Pennsylvania, facility that occurred from May 7, 2013 until June 4, 2013.
The company said the FDA cited deficiencies in response to a letter sent by the company to the agency following the Form 483, List of Investigational Observations delivered to the company after the inspection. “These deficiencies relate to the Company’s MicroFuse Putty manufactured between October 25, 2012 and December 20, 2012, and mechanical testing of the Company’s MicroFuse Putty, procedures to control environmental conditions in a clean room at the Company’s facility, and internal procedures for medical device reporting, ” read the Warning Letter, according to the company.
The FDA had not posted the Warning Letter on its website as of October 17, 2013.
The Globus SEC filing said the warning letter does not restrict the company’s ability to manufacture or seek 510(k) clearance of products.
The company says it is currently addressing the deficiencies cited by the FDA in the warning letter and intends to work expeditiously to address each of the outstanding issues. The company believes that the FDA’s concerns set forth in the warning letter “can be resolved without a material impact to the company’s financial results. However, the company cannot give any assurances that the FDA will be satisfied with its response to the warning letter or its proposed resolution of the outstanding issues.”
Analyst: “Not Much Impact”
Our friends at MassDevice reported on October 15, 2013 that Leerink Swann analyst Richard Newitter said in a note to investors that the warning letter is unlikely to have much of an effect on Globus, because its putty business is so small.
Newitter’s note stated, “We estimate MicroFuse comprises <1% of GMED’s total sales, and we would note that biologics has been an area where GMED’s portfolio has been most lacking; thus not a growth driver for the company. In fact, in our view biologics remains very much a future growth opportunity for GMED. Warning letters are never a good thing, but again MicroFuse is not a key product for GMED. We checked in briefly with management, and the company is currently addressing the deficiencies cited by the FDA in the warning letter and intends to work quickly to address the issues.”
