Well, 1st quarter results will be posted soon (for BSX & STJ). I will delve into them as they come out. Unfortunately, Medtronic reports on its own year - they end the fiscal year on April 30th. This makes it difficult to do apples-to-apples comparisons. However, it does make for some interesting events. I bet the push for bulks is in full force at Medtronic. Got to make those EOY numbers.
In my experiences, I've noticed that Medtronic makes a big push to do bulk purchases in April (EOY) and October. I know your asking yourself - Why October? Well, STJ & BSX end their fiscal years on December 31st. These companies try to get large bulks done in December. Medtronic likes to "block the shelf" by bulking large amounts in October to prevent BSX & STJ from bulking.
Speaking of bulking, I hate it (so do most reps). Bulking truly does nothing for the customer. What I would like to see is hospitals going to matrix or "pay to play" pricing and eliminate bulks. Bulks are great for companies because they get to book revenue in the current quarter - even though some of the equipment might not et used until the 3rd month of the next quarter. Bulks put reps, "in the hole." Reps have this huge bulk inventory sitting on their laps, and they can't earn commissions until the stuff is implanted. Of course, management can use bulks as a motivational tool - well, Rep X, what are you doing to get that bulk moving?
Here's an example (imaginary - of course). What if you bulk in a huge amount at the end of a quarter, and then issue a series of recalls in the following quarter? What happens to the stuff on the shelf? Well, it sits there. Usage drops dramatically because customers/patients are hesitant to use the product. The purchasing manager doesn't look so smart anymore when there is $750,000 of product on a shelf collecting dust, while other companies are billing out cases.
That brings me to another topic - contracting. I'll get into it more later, but these market share agreements only help the companies, not the customer. What good does it do a hospital to force its physicians to use only 1 or 2 customers? It helps the company by solidifying barriers to entry, but thats about it. I'll get into why market share agreements are bad for reps in another post.
Have a great weekend.
Sunday, April 15, 2007
Sunday, April 8, 2007
Defibrillator Leads - Is Smaller Necessarily Better - 2006 Abstract from Cornell
I recently found an abstract from 2006 that discussed the Sprint Fidelis. Although the full article has never been published, I thought the results of the abstract are interesting - 17% incidence of abnormal RV sensing! Wow!
Link
Defibrillator leads: Is smaller necessarily better?
Mirchandani, Sunil; Stein, Kenneth M; Markowitz, Steven M; Iwai, Sei; Shah, Bindi K; Cheung, Jim W; Tan, Vivian R; Dhruvakumar, Sandhya; Dobesh, David P; Nemirovsky, Dmitry; Lerman, Bruce B; Mittal, Suneet | Circulation, 2006; 114
Background: The diameter of ICD leads has become progressively smaller over time. Smaller leads may allow for easier passage into the right ventricle (RV), increased compatibility with systems incorporating multiple leads, and improved durability. However, the long-term performance characteristics of these smaller leads are unknown.
Methods: The Medtronic Sprint Fidelis family of ICD leads (models 6931 and 6949) has a 6.6 Fr caliber and is the first generation of defibrillator leads capable of passing through a 7 Fir sheath. The lead provides true bipolar sensing and has an active fixation mechanism. We evaluated consecutive patients (pts) who underwent implantation of a Fidelis lead (between 9/04-10/05) to determine the incidence of abnormal sensing (R wave <= 5 mV) during follow-up as well as the need for a lead revision in these pts.
Results: The study consisted of 185 pts (133M, age 65 +/- 16 years) with a mean EF of 32 +/- 10 %. At ICD implantation, 8 (4%) pts were pacemaker (PPM) dependent. In the remaining 177 pts, the mean R wave was 13.0 +/- 6.2 mV, as measured through the Medtronic PSA. Nine (5%) pts were subsequently lost to follow-up. In the remaining 168 non-PPM dependent pts with follow-up, initial ICD interrogation occurred at a median of 6 (1,12) days post-ICD implantation. The mean R wave at follow-up was significantly lower than at implant (9.9 +/- 5.0 mV, p < 0.001). A decrease in the R wave (range: 0.1-16.9 mV drop) was observed in 129 (71%) pts at first follow-up. A R wave : 5 mV was observed in 29 (17%) study pts. In addition, 7 (4%) pts required a RV lead revision within the first 8 weeks of implant due to abnormal RV sensing and an elevated RV pacing threshold.
Conclusions: A 17% incidence of abnormal RV sensing was observed during follow-up of pts implanted with the Medtronic Sprint Fidelis ICD lead. This necessitated an early revision of the system in 4% of pts. Whether this problem is related specifically to the design of this particular lead or is a limitation of smaller defibrillator leads in general is unknown.
Link
Defibrillator leads: Is smaller necessarily better?
Mirchandani, Sunil; Stein, Kenneth M; Markowitz, Steven M; Iwai, Sei; Shah, Bindi K; Cheung, Jim W; Tan, Vivian R; Dhruvakumar, Sandhya; Dobesh, David P; Nemirovsky, Dmitry; Lerman, Bruce B; Mittal, Suneet | Circulation, 2006; 114
Background: The diameter of ICD leads has become progressively smaller over time. Smaller leads may allow for easier passage into the right ventricle (RV), increased compatibility with systems incorporating multiple leads, and improved durability. However, the long-term performance characteristics of these smaller leads are unknown.
Methods: The Medtronic Sprint Fidelis family of ICD leads (models 6931 and 6949) has a 6.6 Fr caliber and is the first generation of defibrillator leads capable of passing through a 7 Fir sheath. The lead provides true bipolar sensing and has an active fixation mechanism. We evaluated consecutive patients (pts) who underwent implantation of a Fidelis lead (between 9/04-10/05) to determine the incidence of abnormal sensing (R wave <= 5 mV) during follow-up as well as the need for a lead revision in these pts.
Results: The study consisted of 185 pts (133M, age 65 +/- 16 years) with a mean EF of 32 +/- 10 %. At ICD implantation, 8 (4%) pts were pacemaker (PPM) dependent. In the remaining 177 pts, the mean R wave was 13.0 +/- 6.2 mV, as measured through the Medtronic PSA. Nine (5%) pts were subsequently lost to follow-up. In the remaining 168 non-PPM dependent pts with follow-up, initial ICD interrogation occurred at a median of 6 (1,12) days post-ICD implantation. The mean R wave at follow-up was significantly lower than at implant (9.9 +/- 5.0 mV, p < 0.001). A decrease in the R wave (range: 0.1-16.9 mV drop) was observed in 129 (71%) pts at first follow-up. A R wave : 5 mV was observed in 29 (17%) study pts. In addition, 7 (4%) pts required a RV lead revision within the first 8 weeks of implant due to abnormal RV sensing and an elevated RV pacing threshold.
Conclusions: A 17% incidence of abnormal RV sensing was observed during follow-up of pts implanted with the Medtronic Sprint Fidelis ICD lead. This necessitated an early revision of the system in 4% of pts. Whether this problem is related specifically to the design of this particular lead or is a limitation of smaller defibrillator leads in general is unknown.
Sprint Fidelis Dear Doctor Letter
Well, I don't want to seem like I'm piling on Boston Scientific. On March 21st, Medtronic issued a "Dear Doctor" letter concerning higher than expected conductor fracture rates with the Sprint Fidelis lead. The Sprint Fidelis is Medtronic's premium defibrillation lead. It is the first sub-7 french ICD to be released (St Jude Medical released the Riata ST lead approximately 18 months after the Sprint Fidelis).
The body of the letter is as follows:
Dear Doctor,
Medtronic has received reports from a limited number of implanting physicians indicating they have experienced higher than expected conductor fracture rates in their centers with Sprint Fidelis leads. While current overall Sprint Fidelis performance is consistent with other leads, Medtronic is actively investigating these reports, has reviewed them with our Independent Physician Quality Panel, and would like to share what we know at this time.
Through detailed assessment of reported fractures, we have identified two primary locations where conductor fractures have occurred: 1) distal portion of the lead and 2) near the anchoring sleeve tie down. The distal conductor fractures affect the anode (ring electrode) and fractures that occur around the anchoring sleeve affect the cathode (helix tip electrode). Fractures at both locations appear to prsenet clinically as over-sensing, increased interval counts and inappropriate shocks. Medtronic has worked closely with physicians who have experienced fractures and conducted significant bench testing in an attempt to reproduce the fractures and identify root cause. At this point, our investigation suggests that variables within the implant procedure may contribute significantly to these fractures.
For distal conductor fractures, our investigation has identified severe bending or kinking of the distal end of the lead over the lead body while passing through tortuous vasculature as a significant contributing factor. If the lead is severely bent or kinked at the distal end, the conductor may be compromised such that the conductor may fracture after implant due to chronic fatigue from natural cardiac motion. The venous structure or pathway, venous access location, length of introducer sheath and lead insertion force are all factors that may contribute to sever bending or kinking of the lead. Medtronic recommends avoiding severe bending or kinking of the lead during implantation. If you encounter excessive resistance resulting in severe bending or kinking while advancing the lead, please remove the lead and return it to Medtronic.
For conductor fractures that occur around the suture sleeve, our preliminary investigation suggests that under certain implant techniques, the lead appears to be exposed to severe bending or kinking in the pectoral area. We are still investigating and actively partnering with physicians to better understand this type of fracture. If excessive kinking or bending is observed during lead suturing and/or pocket formation, Medtronic recommends the lead be re-sutured and/or pocket reassembled per guidelines in the Medtronic lead implant manual. In addition, positioning the anchoring sleeve against or near the vein may be helpful.
Sprint Fidelis lead models 6949, 6948, 6931, and 6930 were market released in the U.S. and internationally in September and October 2004. Performance of model 6949, the Sprint Fidelis lead currently followed in our System Longevity Study, indicated survival is 98.9% at two years. Sprint Fidelis 6949 performance based upon return product analysis shows 99.86% chronic fracture-free survival at two years. Both evaluation methods suggest performance is in line with other Medtronic leads and consistent with lead performance publicly reported by other manufacturers.
This letter was sent to all implanting U.S. physicians and nowhere was there any request for confidentiality. That is why I posted it.
Well, the lead fails and they state, "variables within the implant procedure may contribute significantly to these fractures." It's the implanter's fault. Of course, that makes perfect sense. The same physician who has implanted endocardial defibrillation leads since 1992 now suddenly doesn't know how to operate one of these new-fangled leads. Are they suggesting that for patients with a tortuous anatomy a different lead should be used - possibly a Sprint Quattro Secure? I don't know. What's going to happen if physicians get nervous and every time they try to implant the lead and "excessive kinking" occurs, they abandon the lead a try a different lead? Will returns to Medtronic increase?
The body of the letter is as follows:
Dear Doctor,
Medtronic has received reports from a limited number of implanting physicians indicating they have experienced higher than expected conductor fracture rates in their centers with Sprint Fidelis leads. While current overall Sprint Fidelis performance is consistent with other leads, Medtronic is actively investigating these reports, has reviewed them with our Independent Physician Quality Panel, and would like to share what we know at this time.
Through detailed assessment of reported fractures, we have identified two primary locations where conductor fractures have occurred: 1) distal portion of the lead and 2) near the anchoring sleeve tie down. The distal conductor fractures affect the anode (ring electrode) and fractures that occur around the anchoring sleeve affect the cathode (helix tip electrode). Fractures at both locations appear to prsenet clinically as over-sensing, increased interval counts and inappropriate shocks. Medtronic has worked closely with physicians who have experienced fractures and conducted significant bench testing in an attempt to reproduce the fractures and identify root cause. At this point, our investigation suggests that variables within the implant procedure may contribute significantly to these fractures.
For distal conductor fractures, our investigation has identified severe bending or kinking of the distal end of the lead over the lead body while passing through tortuous vasculature as a significant contributing factor. If the lead is severely bent or kinked at the distal end, the conductor may be compromised such that the conductor may fracture after implant due to chronic fatigue from natural cardiac motion. The venous structure or pathway, venous access location, length of introducer sheath and lead insertion force are all factors that may contribute to sever bending or kinking of the lead. Medtronic recommends avoiding severe bending or kinking of the lead during implantation. If you encounter excessive resistance resulting in severe bending or kinking while advancing the lead, please remove the lead and return it to Medtronic.
For conductor fractures that occur around the suture sleeve, our preliminary investigation suggests that under certain implant techniques, the lead appears to be exposed to severe bending or kinking in the pectoral area. We are still investigating and actively partnering with physicians to better understand this type of fracture. If excessive kinking or bending is observed during lead suturing and/or pocket formation, Medtronic recommends the lead be re-sutured and/or pocket reassembled per guidelines in the Medtronic lead implant manual. In addition, positioning the anchoring sleeve against or near the vein may be helpful.
Sprint Fidelis lead models 6949, 6948, 6931, and 6930 were market released in the U.S. and internationally in September and October 2004. Performance of model 6949, the Sprint Fidelis lead currently followed in our System Longevity Study, indicated survival is 98.9% at two years. Sprint Fidelis 6949 performance based upon return product analysis shows 99.86% chronic fracture-free survival at two years. Both evaluation methods suggest performance is in line with other Medtronic leads and consistent with lead performance publicly reported by other manufacturers.
This letter was sent to all implanting U.S. physicians and nowhere was there any request for confidentiality. That is why I posted it.
Well, the lead fails and they state, "variables within the implant procedure may contribute significantly to these fractures." It's the implanter's fault. Of course, that makes perfect sense. The same physician who has implanted endocardial defibrillation leads since 1992 now suddenly doesn't know how to operate one of these new-fangled leads. Are they suggesting that for patients with a tortuous anatomy a different lead should be used - possibly a Sprint Quattro Secure? I don't know. What's going to happen if physicians get nervous and every time they try to implant the lead and "excessive kinking" occurs, they abandon the lead a try a different lead? Will returns to Medtronic increase?
Another Boston Scientific Product Advisory
Well, Boston Scientific (Guidant) issued another product advisory on April 5th. This one relates to certain low-voltage capacitors on certain ICDs and CRTDs. By "certain," I mean it affects devices within every product line they currently sell - Vitality, Vitality 2, Renewal 3, and Renewal RF.
I'll start the the discussion by giving an overview of capacitors. Simply put, capacitors are used in an electrical circuit as an energy storing tool. A good discussion of capacitors is at How Stuff Works - Capacitors.
In its letter, Link Boston Scientific states that, "These capacitors may cause accelerated battery depletion and may reduce the time between elective replacement indicator (ERI) and end of life (EOL) to less than three months. Device replacement indicators continue to function normally." They go on to state that there have been, "No confirmed reports of shortened ERI to EOL time while implanted." However, Nineteen (19) of approximately 73,000 devices in this population worldwide have been confirmed to have accelerated battery depletion, which could have resulted in shortened ERI to EOL time." Finally, there have been no patient deaths.
They recommended reviewing every patient's chart to assess battery voltage. If the device hits MOL2 within 27 months (32 months for EL devices), then the patient should be followed monthly until ERI is reached.
The burden this places on physicians and clinics is tremendous. Going through every chart to ascertain battery voltage and time since implant is time consuming. Who must go through charts - the reps or staff? Additionally, asking a patient to come in every month is extremely inconvenient to the patient. What if that patient can't drive? Does a family member have to take time off to bring the patient in?
I bet the FDA will classify this advisory as a recall. Once that happens, Boston Scientific will change its tune and offer a free device to any patient that wants one. Of course other manufacturers will offer programs where they will pay unreimbursed medical expenses and offer discounts to hospitals if a physician/patient decides they don't want to replace the Boston Scientific device with another BSX device.
Product advisories are a fact of life in the medical device business. That being said, Boston Scientific has had a quite a few the past 2 years. Many at BSX believe that “the world is against them.” That their quality system is robust and Barry Meiers (New York Times) and other are simply making a mountain out of a mole hill. I disagree and think the problems may be indicative of a failure of the internal control systems. I wonder if the relentless desire to sell the company off at the highest price (in 2004-05) didn’t have an effect on the reporting of problems internally. I don’t claim to know what happened at internal meetings, but, the sheer number of advisories/recalls lends credence to this hypothesis.
I think this latest advisory may be the proverbial “straw that breaks the camels back,” as far as some customers are concerned. How often can a physician say to him/herself, “Hey, it’s just a small problem, the risks are being overblown.” At this point, I think some customers may simply decide that they will no longer use Boston Scientific.
I'll start the the discussion by giving an overview of capacitors. Simply put, capacitors are used in an electrical circuit as an energy storing tool. A good discussion of capacitors is at How Stuff Works - Capacitors.
In its letter, Link Boston Scientific states that, "These capacitors may cause accelerated battery depletion and may reduce the time between elective replacement indicator (ERI) and end of life (EOL) to less than three months. Device replacement indicators continue to function normally." They go on to state that there have been, "No confirmed reports of shortened ERI to EOL time while implanted." However, Nineteen (19) of approximately 73,000 devices in this population worldwide have been confirmed to have accelerated battery depletion, which could have resulted in shortened ERI to EOL time." Finally, there have been no patient deaths.
They recommended reviewing every patient's chart to assess battery voltage. If the device hits MOL2 within 27 months (32 months for EL devices), then the patient should be followed monthly until ERI is reached.
The burden this places on physicians and clinics is tremendous. Going through every chart to ascertain battery voltage and time since implant is time consuming. Who must go through charts - the reps or staff? Additionally, asking a patient to come in every month is extremely inconvenient to the patient. What if that patient can't drive? Does a family member have to take time off to bring the patient in?
I bet the FDA will classify this advisory as a recall. Once that happens, Boston Scientific will change its tune and offer a free device to any patient that wants one. Of course other manufacturers will offer programs where they will pay unreimbursed medical expenses and offer discounts to hospitals if a physician/patient decides they don't want to replace the Boston Scientific device with another BSX device.
Product advisories are a fact of life in the medical device business. That being said, Boston Scientific has had a quite a few the past 2 years. Many at BSX believe that “the world is against them.” That their quality system is robust and Barry Meiers (New York Times) and other are simply making a mountain out of a mole hill. I disagree and think the problems may be indicative of a failure of the internal control systems. I wonder if the relentless desire to sell the company off at the highest price (in 2004-05) didn’t have an effect on the reporting of problems internally. I don’t claim to know what happened at internal meetings, but, the sheer number of advisories/recalls lends credence to this hypothesis.
I think this latest advisory may be the proverbial “straw that breaks the camels back,” as far as some customers are concerned. How often can a physician say to him/herself, “Hey, it’s just a small problem, the risks are being overblown.” At this point, I think some customers may simply decide that they will no longer use Boston Scientific.
Saturday, April 7, 2007
Astra Zeneca Sales Manager Fired
Attached is a link to an interesting article from the Philadelphia Inquirer about a sales manager at Astra Zeneca who was fired after comments he made in an internal publication were posted on the blog of Dr Peter Rost (formerly, of Pfizer/Pharmacia).
The basics of the article are that someone leaked an internal sales newsletter in which the manager was asked his sales goals for 2007. His sales goal number 3 is,
"Call Execution - Not making the calls you are supposed to make does not drive your business. I see it like this: there is a big bucket of money sitting in every office. Every time you go in, you reach your hand in the bucket and grab a handful. The more times you are in, the more money goes in your pocket. Every time you make a call, you are looking to make more money."
In a statement, Astra Zeneca said,
"AstraZeneca strongly repudiates the negative comments made in this newsletter. Additionally, "This newsletter was produced outside of AstraZeneca's required approval and review processes."
To be quite honest, nothing in the newsletter was overly surprising. These things are published and sent to sales representatives, usually on a quarterly basis. I find the company's response to be a little disingenuous. This particular newsletter was the winter edition. Seeing that we are now officially in spring, it was probably published some time ago. Claiming that no one ever saw/heard/noticed this interview before the publication on Peter Rost's blog is not particularly believable.
Salespeople are partially compensated on sales achievement. This should not be news to anyone. This compensation method holds true for people selling air conditioners, nuclear submarines, or pharmaceuticals. People claiming to be "shocked" over the statements are either naive or dishonest. I don't claim to know Peter Rost, or anything about him; despite this, his prior experiences tell a lot. He was a Vice-President at Pfizer, and before that a General Manager in northern Europe. One does not get promoted into these positions without understanding sales goals and sales achievement. I know Mr Rost is considered a whistleblower today, but in a previous life he was responsible for increasing the sales of products in specific therapeutic areas.
Link Via The Philadelphia Inquirer
The basics of the article are that someone leaked an internal sales newsletter in which the manager was asked his sales goals for 2007. His sales goal number 3 is,
"Call Execution - Not making the calls you are supposed to make does not drive your business. I see it like this: there is a big bucket of money sitting in every office. Every time you go in, you reach your hand in the bucket and grab a handful. The more times you are in, the more money goes in your pocket. Every time you make a call, you are looking to make more money."
In a statement, Astra Zeneca said,
"AstraZeneca strongly repudiates the negative comments made in this newsletter. Additionally, "This newsletter was produced outside of AstraZeneca's required approval and review processes."
To be quite honest, nothing in the newsletter was overly surprising. These things are published and sent to sales representatives, usually on a quarterly basis. I find the company's response to be a little disingenuous. This particular newsletter was the winter edition. Seeing that we are now officially in spring, it was probably published some time ago. Claiming that no one ever saw/heard/noticed this interview before the publication on Peter Rost's blog is not particularly believable.
Salespeople are partially compensated on sales achievement. This should not be news to anyone. This compensation method holds true for people selling air conditioners, nuclear submarines, or pharmaceuticals. People claiming to be "shocked" over the statements are either naive or dishonest. I don't claim to know Peter Rost, or anything about him; despite this, his prior experiences tell a lot. He was a Vice-President at Pfizer, and before that a General Manager in northern Europe. One does not get promoted into these positions without understanding sales goals and sales achievement. I know Mr Rost is considered a whistleblower today, but in a previous life he was responsible for increasing the sales of products in specific therapeutic areas.
Link Via The Philadelphia Inquirer
Random Thoughts
I know it seems like I picked two areas that have nothing in common. Well, they don't, except for the fact that I'm interested in both areas.
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