- The year Google went public.
The year Martha Stewart served five months in prison. Ronald Reagan, Ray Charles, and Marlon Brando died. American Idol was the #1 TV show and 69% of Californians voted in favor of Stem Cell Research.
The year Carlsbad, California-based NuVasive, Inc. sold 6.8 million shares to raise $68 million. (NuVasive’s sales that year were $38 million.)
And…the year NuVasive’s manager of interbody development, Jason Blain and his friend, one of the senior execs at CoorsTek, Inc., Todd Andres, quit their respective jobs to start…Quantum Orthopedics?
Today, the little company that Blain and Andres started is booking approximately $100 million in annual sales—almost 3x more than NuVasive did when Blain left in 2004.
Taking That Quantum Leap to Surf a PEEK Wave
Blain and Andres planned to ride the wave of a new implant material—PEEK (polyether ether ketone). Before PEEK, the most common spine spacers were either forged from titanium or processed from donated human bone.
Neither was ideal. Allograft was plagued with inconsistent availability, difficult supply chain quirks (like having to track donor registrations and medical records) and variable quality. Titanium blocked out X-rays—which made post-op imaging only marginally useful.
PEEK solved those problems. It didn’t block X-rays and, being a polymer, was always available and consistent. And the range of shapes was limited only by a product manager’s imagination.
Blain and Andres took out a small loan, named themselves Quantum Orthopedics—because, of course, they had left their jobs to, well, take a Quantum Leap.
OEM Manufacturing
Blain and Andres successfully machined their first PEEK prototypes in 2004. With those in hand, they were able to close a $1.3 million friends and family round. Very soon, they were manufacturing PEEK interbody spacers for about five or six companies, among them Zimmer Spine.
After that initial $1.3 million, Blain and Andres went 100% organic—funding, that is. No outside money, just grow one person, one product at a time.
In 2006, Blain and Andres changed the company name to Spinal Elements®, Inc. (another Quantum Orthopedics, it turned out, had prior claim on the name).
Laying the Foundation for Innovation
Among the “firsts” that Blain and Andres take credit for are:
- The very first cervical standalone interbody implant which they brand named “Mosaic”
- The first PEEK inter-bodies with a titanium coating.
And, really, driving the early standalone interbody implants with designs like Mag+ and Vertu.
Indeed, Mosaic and Mag+ illustrate one of the more unusual aspects of Spinal Elements—their product brand names are better known than the company itself.
Just about every spine surgeon has heard of the Mosaic cervical implant or the Mag+ implants…but not every surgeon can name the company who developed them or manufacturers them.
Which is probably a legacy of their OEM (original equipment manufacturer) roots.
Between 2006 and 2012, Spinal Elements kicked into a new gear and added traditional pedicle screws, posterior cervical, standalone interbodies, Mag+ and both cervical and lumbar spine and Sapphire cervical plating to its platform.
In 2012, Spinal Elements introduced the first, PEEK inter-body implant with a titanium coating.
Virtually every major spine company—NuVasive, Globus Medical, Inc., Medtronic, Stryker Corporation—turned down the idea of coating a PEEK interbody with titanium.
Only Spinal Elements saw its appeal and value at the time.
Later, companies like Titan Spine and other titanium manufacturers would jump on the bandwagon, but Spinal Elements led the way.
Enter Amendia
In 2016, New York-based private equity firm, Kohlberg & Company, invested in a small, but ambitious Georgia spinal implant company, Amendia, Inc. Amendia had raised capital and was selling cervical interbody, cervical fixation and lumbar interbody implants as well as screws, biologics, and instrumentation. Under CEO Chris Fair, a former St Francis and DePuy executive, Amendia was trying to create a one-stop shop for surgeons treating spinal disorder patients.
With the Kohlberg investment, Amendia added people and products.
In 2017, Kohlberg announced that wanted to acquired Spinal Elements and decided to use its Georgia-based company, Amendia to do it.
Ironically, even though the headlines at the time said “Amendia Buys Spinal Elements” it was, in fact, the Spinal Elements management team that wound up operating both companies and, as Rick Simmons, Spinal Element’s chief marketing officer, told OTW: “Kohlberg had purchased Amendia initially. Looking back at their business development and screening activities, they realized that they really liked the Spinal Elements innovative products and management team. They liked our quality systems and regulatory, so they decided to put Amendia and Spinal Elements together for greater scale and innovation.”
All of Amendia’s operations moved to Carlsbad. The Georgia plant shut down and Spinal Elements, the surviving company kept three Amendia product franchises—Overwatch, which is Spinal Element’s leading thoracolumbar fixation product, biologics through the Miami tissue bank (known as Vivex), OmegaLIF, which is for Kambin’s triangle access and fusion.
Sharpening the Focus to MIS Spine
Over the next four years, Spinal Elements implemented a plan to serve the rapidly evolving needs of the MIS (minimally invasive spine) spine surgeon.
Blain and his team came up with, in effect, a sequence of devices that carried each surgeon from access to disc prep, to expandable interbodies, to biologics, posterior fixation, and, to cap it all off, a very novel lateral retractor for interbody spine fusion.
Despite the foray into Amendia, Spinal Element’s corporate culture, which was forged by Blain and Andres early on—growing one system, one employee at a time—kept Spinal Elements healthy while other young firms didn’t make it in the increasingly tough spinal implant market.
One such company was Benvenue Medical, Inc.
Benvenue had invented one of the most novel expandable spacers and disc prep ever designed. The company ran the marathon of product development through FDA clearance but didn’t have enough gas in the tank, ultimately, to get market scale and reach financial stability.
In 2020, Spinal Elements bought Benvenue’s assets and took over, among other products, the LUNA line of MIS interbody spacers and Orbit Disc Prep.
Yet another first in terms of interbody designs.
In late 2020, Blain and his team launched another “first,” the Karma posterior fixation metal free technology. All told, between 2020 and 2023, Spinal Elements has introduced nine (!) new products of which five are either steerable, expandable or both.
Finally, no surprise, Spinal Elements is a player in the 3D printed revolution but, true to form, in a wholly innovative way.
The just announced VENTANA franchise is the first ever implant with a door. A hinged door. Why didn’t anyone think of this earlier? No need to navigate around an implant’s architecture to fill it with bone graft, just open the hinge and put it in.
Easy.
Jason Blain Retires and Ron Lloyd Becomes CEO
In early 2023, 20 years after launching his company and nearly 8 years after his co-founder Todd Andres left the firm, Jason Blain decided to hang up the spurs and start a fresh chapter.
When one door closes, of course, another opens. Leading Spinal Elements now is former CEO of Aziyo Biologics and, before that, president of Hospital Therapies for Mallinckrodt Pharmaceuticals, Ron Lloyd.
Mr. Lloyd also served as a senior executive at Abbott and Baxter Healthcare.
Recently OTW interviewed Mr. Lloyd and he began our conversation saying, “Spinal Elements has a culture of innovation where the team members take great pride in improving the care of patients within the spine world.”
“I also think that Spinal Elements has demonstrated the ability to try to be nimble and responsive and to be able to interact directly with surgeons on a personal basis to solve their needs. Those, I think, are the hallmarks of the Spinal Elements culture.”
Among Spinal Elements product strengths, Lloyd added, “I think we’ve got one of the broadest and deepest portfolios of expandable products. In addition, we really believe that our Orbit disc prep system is state of the art and allows surgeons to be able to use larger footprint expandable interbody devices.”
The Aging Spine Patient
After joining Spinal Elements, Lloyd asked his team to take a deeper dive into patient characteristics.
“When I came in, we did a fair amount of market research and we were very fortunate in having a number of surgeons who’d worked with us over the years and used a variety of our products, including one of our newest, the Karma system which is a metal-free fixation system.”
“We learned that the best application of a metal free, novel fixation approach is the degenerative aging spine patient—leveraging the cortical anatomy of the vertebral body. We’re excited about that because it’s one of the largest, fastest growing spine market segments.”
Indeed, the over 65-year-old patients are the fastest growing spine market segment. And they present with unique clinical problems, e.g., stenosis and instability. Over 50% have poor bone mineral density, for example. “So, we’re excited about the novel solution that Karma brings in that patient population,” said Lloyd.
The Ambulatory Surgery Center
In many ways, when Spinal Elements decided in 2019 to make MIS spine surgery its focus, it also set the stage for the ambulatory surgery center (ASC) market.
As Lloyd explained to OTW, “Over the next several years, we’ll be leveraging some of these technologies to support spine surgery in an ambulatory surgery center, which makes it easier from a patient perspective, less time under anesthesia and faster recovery all based on a less invasive procedure, which I think mirrors where the market is heading.”
Rick Simmons, who also, like Jason Blain, hails from NuVasive, joined Spinal Elements as part of the Benvenue acquisition. He is currently chief marketing officer for Spinal Elements and he explained to OTW, “Spinal Element’s market share and MIS portfolio, I think, makes us uniquely positioned to leverage the ambulatory surgery market.”
“The kind of formula for a very good TLIF [transforaminal lumbar interbody fusion] operation—access, disc prep, interbody, biologics, fixation—Spinal Elements is in a very good position to serve surgeons who are moving to the ASC setting. We’ve already started with disposable tools for interbody cases.”
The Next 20 Years
If the last 20 years in spine innovation was a roller coaster ride of innovation, the next 20 will be, no doubt, defined by change agents like Spinal Elements.
MIS and the ambulatory surgery market will remain growth areas for the foreseeable future. Indeed, why would spine surgery go back to the cost heavy, central hospital model? Spinal Elements is an MIS and ASC pioneer.
Finally, landing on the aging spine patient as a focus opens up a whole series of problem-solving initiatives and clear points of differentiation.
In closing, congratulations to Blain and Andres for starting one of the few surviving 20-year-old companies (not even NuVasive lasted into 2024) and Go Team Go to Ron Lloyd, Rick Simmons, and the rest of the terrific Spinal Elements team—you have a brilliant future ahead.
