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Jury Rules against Kinetic Concepts' Patent Infringement Claim
Ware |
Earlier this month, a U.S. district court jury ruled that although patents held by Kinetic Concepts Inc. (KCI; San Antonio, TX) related to its wound-care products are valid, they were not infringed by BlueSky Medical Group Inc. (Carlsbad, CA). In its suit, KCI had alleged that BlueSky's Versatile 1 system violated KCI's vacuum-assisted closure (VAC) technology patents. The verdict surprised a number of medtech analysts who had predicted that KCI would prevail in the court case.
Dennert O. Ware, KCI president and CEO, said that the company plans to challenge the decision before the trial court and on appeal. "The jury verdict confirms our belief that the fundamental intellectual property covering our revolutionary VAC technology is valid and enforceable, although we plan to challenge the finding of noninfringement," he said. KCI's stock dropped almost 41% on news of the jury verdict. Wound care products accounted for 78% of the company's second-quarter revenues of $330 million.
[ More ]
Utah Medical Seeks HHS Reconsideration
Cornwell |
Last October, Utah Medical Products Inc. (Midvale, UT) successfully defended itself against FDA charges that the company had failed to comply with requirements of the agency's quality system regulation (QSR). But despite Utah Medical's unprecedented court victory, the U.S. Department of Health and Human Services (HHS; Washington, DC) denied the company's allegation of abuse of process and refused its request for restitution of litigation costs and lost profits. Concerned that many damaging documents that allege noncompliance with the QSR still remain on FDA's Web site, Utah Medical has formally requested that HHS reconsider the case.
"There was never any question about the quality or safety of our products," said Kevin Cornwell, Utah Medical's CEO. "While the court cleared our name unequivocally—and we're thankful for that—HHS needs to ensure that FDA sets the record straight for the benefit of our employees, our customers, our shareholders, and ultimately the patients that use and benefit from our products. Based on our experiences with FDA and HHS, maybe I shouldn't be optimistic about pursuing this further. But I am. It's simply the right thing to do, and I'm counting on our government's healthcare regulatory agencies to do it."
[ More ]
Reimbursement Cuts Less Severe than
Initially Feared
Collins |
Medtech manufacturers breathed easier this month following the
release by the Centers for Medicare and Medicaid Services
(CMS; Baltimore) of the agency's payment reforms for inpatient
hospital services for 2007. When the payment changes were initially
proposed in April, some medtech segments—particularly cardiovascular
stents and implantable cardioverter defibrillators—faced anticipated
reimbursement reductions of 20 to 30%. However, the final cuts proved
to be far more benign, with no decrease greater than 5.4%. Under the
new rules, the orthopedics sector will see reimbursement increases
in certain implant categories.
Medtronic Inc. (Minneapolis), a leading manufacturer of cardiac
rhythm management devices, commended CMS for requesting and
responding to stakeholder input in establishing the final
reimbursement rates. Describing the agency's move as a transition
to a "more accurate, cost-based system," Art Collins, Medtronic's
chairman and CEO, said the final rule "preserved patient access to
some of the newest, most innovative medical technologies by ensuring
that adequate reimbursement exists for these procedures." The new
reimbursement rates will be phased in over a three-year period
beginning this October.
[ More ]
Medtech's Strength Evident in Patent Scorecard
Kratzer |
Each year, intellectual property research and advisory services
firm ipIQ (Chicago) ranks corporate innovation across multiple
industries by analyzing the strength, breadth, and quality of
patents and patent portfolios. Based on its proprietary measures,
ipIQ publishes an annual report called the Patent Scorecard, which
ranks 15 patenting industries.
In the 2006 scorecard, the medical device industry delivers an
impressive overall performance. For an in-depth look at the
medical device firms highlighted in the 2006 ipIQ Patent
Scorecard, look for the article "Medtech's Patent Strongholds"
by Scott Kratzer in the upcoming September/October issue of MX:
Business Strategies for Medical Technology Executives.
[ More ]
House Passes Health IT Bill
Dillione |
In late July, the U.S. House of Representatives voted 270–148 to
pass the Health Information Technology (IT) Promotion Act of 2006.
The bill must now be reconciled with a similar bill passed by the
Senate in November. Senate Majority Leader Bill Frist (R–TN) says
healthcare IT is high on his list of priorities and predicts
Congress will pass legislation when members return from their
August recess.
Siemens Medical Solutions (Malvern, PA), a supplier of medtech
equipment and healthcare IT systems, described passage of the bill
as "another key step in advancing the creation of a nationwide,
interoperable health information infrastructure." Commenting on
the legislation, Janet Dillione, president of Siemens' healthcare
IT division, said, "Advancing healthcare information technology
adoption is critical to modernizing healthcare and moving from
managing chronic illness to managing wellness and
preventing disease."
[ More ]
FDA Posts 2007 User Fees
FDA has published its new medical device user fee rates for 2007.
The new rates for both premarket approval (PMA) applications and
510(k) applications represent an increase of 8.5%—the maximum
allowed under the Medical Device User Fee Stabilization Act of
2005. The PMA fee will increase to $281,600 while the 510(k) fee
rises to $4158. The user fee program will sunset on September 30,
2007, unless it is reauthorized by Congress. FDA and various
industry stakeholders have been working on the continuation of
the program since last year. [ More ]
IP Watch: Obviousness on Review; Boston Scientific and
St. Jude Settle Disputes
Starks |
Since the end of June, the intellectual property blogosphere has
been buzzing with speculation about the potential impact of the
U.S. Supreme Court's forthcoming review in the case of KSR
International Co. v. Teleflex Inc. on appeal from the Court of
Appeals for the Federal Circuit. At issue is the test currently
applied to prove the ‘nonobviousness' of a claimed invention, a
condition for patentability that has been used since the creation
of the Federal Circuit in 1982. If the court overthrows the current
standard, the window of patentability available for incremental
advances may be greatly diminished—perhaps with devastating effects
on small companies in the medical device industry.
Meanwhile, in late July, St. Jude Medical Inc. (St. Paul, MN) and
Boston Scientific Corp. (Natick, MA) settled four patent litigation
matters relating to the companies' cardiology and neurology
products. Each company agreed to cross-license certain aspects of
their patent portfolios in these areas. "We are pleased to have
reached these agreements, which eliminate much of the expense and
uncertainty associated with the litigation and enable the company
to focus its resources and attention on providing patients with
life-saving products," said Daniel J. Starks, St. Jude Medical
chairman, president, and CEO. Read more about this
settlement and other industry patent dispute resolutions in this
month's installment of IP Watch. [ More ] |
