How f*cked is DuraSeal once Adherus launches?

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anonymous

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I have heard that HyperBranch's Adherus is nearly ready to reach the U.S. market following several months of wrangling with the FDA over labeling. The former Covidien distributors are all lined up and ready to move with the product once they get the go ahead from HyperBranch.

What will all the Integra reps do once a better, cheaper dural sealant hits the market? Integra management seems to have a knack for buying companies that don't grow (e.g. all the spine companies).
 












Are you suggesting Medtronic bought HyperBranch?

If so, you are wrong.

Even if you were right, Integra reps would still be screwed, probably even more so because Medtronic has a much larger commercial organization than HyperBranch.

Best to keep your mouth shut and be thought of as a fool than to speak and remove all doubt.
 






not sure where your getting your info that Adherus is better than Duraseal. I reviewed their PMA data at FDA website. Clinical outcomes were identical so no improvement there.

Cheaper?? says who. The cost of these products is not in the raw materials. It is all tied up in just manual labor and overhead to make the products. So they would have similar margins and probably similar selling positions unless Adherus is trying to gain market share with price, but this is not good for anybody as the margins on these products are not that big in the first place.
 






Low margin? Boy, you are way out of your league. DuraSeal has gross margins of 80%, well above Integra's corporate average. Adherus will cut the price of their product in order to gain market share.

While you are technically correct that the PMA data for clinical endpoints was similar to DuraSeal there are two key innovations from Adherus that are very important to surgeons: less swelling than DuraSeal and an easier applicator that doesn't clog and cause problems like DuraSeal.

Integra's dural repair sales slowed this quarter, wait until a better product reaches the market.
 












ok, sure current margins for Duraseal are in the low 80s. I should have cited that for these types of devices, when a few similars are in the market, the margins will settle in around 60-65%. happened in the vascular sealing market (Coseal, Bioglue, and soon to be Progel for vascular sealing) and in the hemostat market. For dural sealing, you will have two products, and J&J working on a study for Evicel in same indication. Can go either way with fibrin sealant in terms of passing the study, but given none of the synthetic sealants have shown any long term clinical benefit (CSF leak beyond 30 days) and rather only intra-operative sealing where a fibrin sealant can do the same, then you will have 3 products competing in the relatively small segment of dural sealing.

Once you start getting below 60%, just not worth it anymore given the high promotional focus these types of products need. So doubt Adherus would discount much more than this as just not an attractive product anymore, but they will discount enough to seduce some product sales. If they promote the spray applicator (runs on batteries), costs will then be higher again versus a simple manual spray tip.
 






Recently went to the AANS conference in Chicagooooo and heard from Stryker dural reps that Duraseal is getting its lunch money stolen by Hyperbranch. Oh, and from the looks of 1Q16 numbers and management talk, the strong dural growth wasn't from Duraseal just Duragen. Keep playing with pricing to fudge the numbers while you still can!
 






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