−Removed: We are a commercial stage medical technology company focused on designing, developing and marketing a new category of tissue reinforcement materials to address unmet needs in soft tissue reconstruction.
−Removed: We offer a portfolio of advanced reinforced tissue matrices that improve clinical outcomes and reduce overall costs of care in hernia repair, abdominal wall reconstruction and plastic and reconstructive surgery.
−Removed: Our products are an innovative solution that integrate multiple layers of minimally-processed biologic material with interwoven polymers in a unique embroidered pattern, which we refer to as a reinforced tissue matrices.
−Removed: Our first portfolio of products, the OviTex Reinforced Tissue Matrix (“OviTex”), addresses unmet needs in hernia repair and abdominal wall reconstruction by combining the benefits of biologic matrices and polymer materials while minimizing their shortcomings, at a cost-effective price.
+Added: We are a commercial-stage medical technology company focused on designing, developing and marketing innovative tissue reinforcement materials to address unmet needs in soft tissue reconstruction.
+Added: We are committed to providing patients with advanced, economically effective biologic material repair solutions to patients to minimize long-term exposure to permanent synthetic materials and improve clinical outcomes.
+Added: Our products are purposefully designed to address the shortcomings of existing reinforcement materials in hernia repair, abdominal wall reconstruction and plastic and reconstructive surgery.
+Added: Our first portfolio of products, the OviTex Reinforced Tissue Matrix (“OviTex”), addresses unmet needs in hernia repair and abdominal wall reconstruction by combining the benefits of biologic matrices and polymer materials while minimizing their shortcomings, at a cost-effective price.
Our OviTex products have received 510(k) clearance from the U.S.
−Removed: Food and Drug Administration (“FDA”) which clearance was obtained and is currently held by Aroa, our exclusive manufacturer and supplier, and have demonstrated safety and clinical effectiveness in our ongoing prospective, single arm, multicenter post-market clinical study, which we refer to as our BRAVO study.
−Removed: To date, we have enrolled 91 patients.
−Removed: The first 32 patients who have undergone surgery and completed the one-year follow-up visit have been evaluated in the BRAVO study and experienced no ventral hernia recurrences, no explantations and no surgical site occurrences requiring follow-up surgery.
−Removed: Our second portfolio of products, the OviTex PRS Reinforced Tissue Matrix (“OviTex PRS”) addresses unmet needs in plastic and reconstructive surgery.
+Added: Food and Drug Administration (“FDA”) which clearance was obtained and is currently held by Aroa, our exclusive manufacturer and supplier.
+Added: Interim results of our ongoing prospective, single arm, multicenter post-market clinical study, which we refer to as our BRAVO study, suggest that OviTex is safe and clinically effective for the treatment of ventral hernias.
+Added: Our BRAVO study was fully enrolled at 92 patients.
+Added: The interim analysis includes patient cohorts at the 90-day, 12-month and 24-month follow-up periods.
+Added: At 90 days post-operative, there were no recurrences or reoperations among the 84 patients analyzed and one implant removal due to a bowel perforation.
+Added: The final 12-month analysis includes 76 patients, of whom two patients experienced a recurrence, both adjacent to the original repair, with the OviTex repairs remaining intact.
+Added: Of the 51 patients that have reached 24-month follow-up, one patient experienced a surgical site occurrence from a superficial infection and none experienced a recurrence or long-term complication.
+Added: Additional results from the 30-day and 24-month patient cohorts showing low rates of surgical site occurrences requiring treatment were presented in September 2020 at the Americas Hernia Society Annual Meeting.
+Added: Our second portfolio of products, the OviTex PRS Reinforced Tissue Matrix (“OviTex PRS”), addresses unmet needs in plastic and reconstructive surgery.
In April 2019, our OviTex PRS products received 510(k) clearance from the FDA, which clearance was obtained by Aroa and is currently held by us.
We began commercialization of our OviTex products in the U.S.
−Removed: in July 2016, and they are now sold to approximately 250 hospital accounts.
+Added: in July 2016, and they are now used in more than 325 hospitals.
Hernia repair is one of the most common surgeries performed in the U.S., representing approximately 1.2 million procedures annually.
6 unchanged sentences
is approximately $500 million.
−Removed: We commenced a limited launch in May 2019 and expect to continue commercializing in a controlled manner to gradually expand our surgeon network throughout 2020.
+Added: We commenced a limited launch in May 2019 and have gathered clinical feedback from our initial surgeon users.
+Added: Based on this feedback, we expanded our commercial launch in June 2020 and expect to continue to expand our surgeon network.
We will also evaluate new generation products.
−Removed: We also intend to engage in discussions with the FDA regarding an Investigational Device Exemption (“IDE”) protocol to study the safety and effectiveness of our OviTex PRS product for an indication in breast reconstruction surgery.
+Added: We also intend to engage in discussions with the FDA regarding an Investigational Device Exemption (“IDE”) protocol to study the safety and effectiveness of our OviTex PRS product for an indication in breast reconstruction surgery.
+Added: The FDA has stated that a PMA, rather than 510(k) clearance will be required for such an indication.
We have a broad portfolio of intellectual property protecting our products, which we believe, when combined with our proprietary manufacturing processes and know-how, provides significant barriers to entry.
Our intellectual property applies to our differentiated product construction and materials.
−Removed: In addition, we believe our exclusive manufacturing and long-term supply and license agreement (the “Aroa License”) with Aroa creates a competitive advantage by allowing us to secure an exclusive supply of ovine rumen at a low cost.
−Removed: Ovine rumen, the forestomach of a sheep, is the source of the
−Removed: biologic material used in our products.
+Added: In addition, we believe our exclusive manufacturing and long-term supply and license agreement (the “Aroa License”) with Aroa creates a competitive advantage by allowing us
+Added: to secure an exclusive supply of ovine rumen at a low cost.
+Added: Ovine rumen, the forestomach of a sheep, is the source of the biologic material used in our products.
In manufacturing the product, we use biologic material from ovine rumen because of its plentiful supply, optimal biomechanical profile and open collagen architecture that allows for rapid cellular infiltration.
3 unchanged sentences
As of December 31, 2020, we had 45 sales territories in the U.S.
−Removed: As part of our commercial strategy, we plan to continue to invest in our commercial organization by hiring additional account managers, clinical development specialists, business managers and administrative support staff in order to cover the highest potential of accounts for soft tissue reconstruction procedures.
−Removed: We plan to continue to contract with group purchasing organizations (“GPOs”) and integrated delivery networks (“IDNs”) to increase access to and penetration of hospital accounts.
−Removed: We plan to adjust our commercial expansion plan as appropriate as we continue to better understand the effects of COVID-19 pandemic on our sales and marketing efforts.
+Added: As part of our commercial strategy, we plan to continue to invest in our commercial organization by hiring additional account managers, clinical development specialists and administrative support staff in order to support and service new accounts for soft tissue reconstruction procedures.
+Added: We believe we can enhance the productivity of our sales force by improving customer segmentation and targeting, leveraging digital channels to engage customers and utilizing engagement analytics to support development.
+Added: We plan to continue to contract with GPOs and IDNs to increase access to and penetration of hospital accounts.
+Added: We will adjust our commercial expansion plan, as appropriate, as we continue to better understand the effects of the pandemic resulting from COVID-19 on our sales and marketing efforts.
+Added: Our business has been impacted by the COVID-19 pandemic.
+Added: We began to see an adverse impact on the number of surgical procedures using our OviTex products in the second half of March 2020.
+Added: Since mid-April 2020, the number of procedures using our products and our corresponding sales have increased in a gradual, non-linear fashion.
+Added: While our procedural volumes improved relative to the second quarter of 2020, we are continuing to be impacted by postponements in non-emergent procedures in areas of the country where COVID-19 infections are rising, however, at a less drastic pace than the second quarter of 2020.
Our revenue for the years ended December 31, 2020 and 2019 was $18.2 million and $15.4 million, respectively, which represents an increase of $2.8 million, or 18%.
−Removed: Our net loss for the same time periods was $22.4 million and $21.1 million, respectively.
+Added: Our net loss for the same time periods was $28.8 million and $22.4 million, respectively, which represents an increase of $6.4 million, or 28%.
As of December 31, 2020, we had an accumulated deficit of $196.7 million.
The vast majority of our revenue to date has been generated from sales of our OviTex products in the U.S., with the remainder generated from sales of our OviTex products in Europe, and sales of our OviTex PRS products in the U.S.
−Removed: In November 2019, we closed our IPO in which we issued and sold 4,398,700 shares of our common stock at a public offering price of $13.00 per share, including 398,700 shares of our common stock sold pursuant to the underwriters’
−Removed: option to purchase additional shares.
+Added: In November 2019, we closed our initial public offering (“IPO”) in which we issued and sold 4,398,700 shares of our common stock at a public offering price of $13.00 per share, including 398,700 shares of our common stock sold pursuant to the underwriters’ option to purchase additional shares.
We received net proceeds of $50.6 million after deducting underwriting discounts, commissions and other offering expenses.
−Removed: Our common stock is listed on the Nasdaq Global Market under the trading symbol “TELA.”
+Added: In June 2020, we completed a follow-on public offering in which we issued and sold 3,000,000 shares of our common stock at a public offering price of $16.00 per share.
+Added: We received net proceeds of $44.7 million after deducting underwriting discounts, commissions and other offering expenses.
+Added: Our common stock is listed on the Nasdaq Global Market (“Nasdaq”) under the trading symbol “TELA.”
Market Opportunity
10 unchanged sentences
Pain is the most common cause of delay in returning to work, followed by wound problems.
−Removed: Long-term pain or discomfort at the hernia repair site is one of the most serious complications of hernia surgery and may, in some cases, persist for years.
+Added: Long-term pain
+Added: or discomfort at the hernia repair site is one of the most serious complications of hernia surgery and may, in some cases, persist for years.
In addition, for third-party payors, the costs related to hernia are significant.
2 unchanged sentences
Hernia repair and abdominal wall reconstruction inpatient per procedure costs in the U.S.
−Removed: ranged from approximately $6,117 to $29,615 in 2018 according to the national average Medicare Severity Diagnosis Related Groups (“MS-DRG”) rate which does not account for surgeon fees involved with such procedures.
+Added: ranged from approximately $6,117 to $29,615 in 2018 according to the national average Medicare Severity Diagnosis Related Groups (“MS-DRG”) rate which does not account for surgeon fees involved with such procedures.
Hernias are prone to recurrence, which often require multiple repair procedures and additional healthcare expenditures.
12 unchanged sentences
Biologic Matrices and Resorbable Synthetic Mesh
−Removed: Modern advances in tissue engineering have transformed the plastic and reconstructive surgeon’s management strategies across a wide variety of applications.
+Added: Modern advances in tissue engineering have transformed the plastic and reconstructive surgeon’s management strategies across a wide variety of applications.
Because biologic matrices incorporate into host tissues and enable revascularization and functional tissue remodeling, surgeons have realized multiple applications for their use, with techniques tailored to the specific requirements of the surgery.
14 unchanged sentences
In a sub-pectoral technique, the upper portion of the breast implant is placed below the pectoralis muscle and a biologic matrix is placed around the lower portion of the breast implant.
−Removed: In a pre-pectoral technique, the entire breast implant is placed above the pectoralis muscle and the full top surface of the breast implant is covered.
+Added: In a pre-pectoral technique, the entire breast implant is placed above the
+Added: pectoralis muscle and the full top surface of the breast implant is covered.
The pre-pectoral technique utilizes a larger biologic matrix compared to that needed with the sub-pectoral technique.
For patients who undergo autologous reconstruction, the donor site of the autologous tissue, typically the abdomen, may require soft tissue reinforcement.
−Removed: Based on the current sales of biologic matrices in the U.S.
−Removed: we estimate the annual U.S.
+Added: Based on the current sales of biologic matrices in the U.S., we estimate the annual U.S.
current addressable market opportunity for our OviTex PRS products to be approximately $500 million.
6 unchanged sentences
Laparoscopic surgery is a minimally invasive surgical technique performed in the abdomen or groin through small incisions.
−Removed: Surgical instruments and devices, such as mesh products, are then delivered to the surgical site through a trocar, which is an access port to the patient’s abdomen or groin.
−Removed: Robotic-assisted surgery is also performed using small incisions in the patient’s abdomen or groin and a trocar, but the surgeon sits at a console in the operating room and operates the robotic instruments remotely.
+Added: Surgical instruments and devices, such as mesh products, are then delivered to the surgical site through a trocar, which is an access port to the patient’s abdomen or groin.
+Added: Robotic-assisted surgery is also performed using small incisions in the patient’s abdomen or groin and a trocar, but the surgeon sits at a console in the operating room and operates the robotic instruments remotely.
At the advent of hernia repair, all procedures were performed using an open surgical technique in which an incision is made through the body to access and repair the hernia.
9 unchanged sentences
Reconstruction materials include synthetic mesh, which can be either permanent or resorbable, and biologic matrices made from tissue material.
+Added: In October 2020, we surveyed a group of 71 surgeons to better understand their receptivity to nature repair solutions, their technique preferences across their hernia practice and their views on the risks associated with plastic mesh.
+Added: Feedback was gathered across inguinal hernia, simple ventral, moderate-to-complex ventral and hiatal hernia repair.
+Added: Included in the group were 43 general surgeons (61%), 19 plastic reconstructive surgeons (27%) and the remainder were colorectal and trauma surgeons.
+Added: These surgeons indicated they believe there is a role for natural repair products across all hernia segments, and expect to increase their usage of those products in the next 24-months.
+Added: Almost 60% of surgeons stated that they are aware of the risks associated with plastic mesh and reported approximately 20% of their hernia patients have voiced concern about the use of plastic mesh within the past 12-months.
Permanent Synthetic Mesh
Permanent synthetic mesh, the oldest category of hernia repair materials, is made of plastic materials that are also used in industrial and consumer products.
−Removed: These products have gained popularity with surgeons because they are relatively inert, can be readily sterilized, exhibit biomechanical strength and durability and are available at relatively low upfront cost.
+Added: These products have gained popularity with surgeons because they are relatively inert,
+Added: can be readily sterilized, exhibit biomechanical strength and durability and are available at relatively low upfront cost.
Limitations of permanent synthetic mesh products may include:
7 unchanged sentences
Many of these complications caused by permanent synthetic mesh require additional surgical intervention, including, explantation of the mesh or repair of hernia recurrence or the abdominal wall.
−Removed: Based on longitudinal data from the Danish Hernia Database, in an analysis of approximately 2,900 patients who received a mesh hernia repair, the observed rate of surgical intervention due to either recurrence or mesh-related complications at five years post operatively was approximately 17%.
−Removed: As a result of these complications and litigation involving these complications, the number of adverse events reported to the FDA for permanent synthetic mesh hernia repairs has risen from 643 in 2016, 2,464 in 2017, to more than 6,400 in 2018 through October.
−Removed: Synthetic mesh products have been the subject of more than 6,000 lawsuits in the U.S.
+Added: Based on longitudinal data from the Danish Hernia Database, in an analysis of approximately 2,900 patients who received a hernia repair using a permanent synthetic mesh, the observed rate of surgical intervention due to either recurrence or mesh-related complications at five years post operatively was approximately 17%.
+Added: As a result of these complications and litigation involving these complications, the number of adverse events reported to the FDA for permanent synthetic mesh hernia repairs has risen from 1,484 in 2016, 3,220 in 2017, 9,887 in 2018 to 18,072 in 2019.
+Added: Synthetic mesh products have been the subject of an increasing number of lawsuits with over 13,000 cases filed in the state of Rhode Island alone.
Biologic Matrices
The complications associated with permanent synthetic mesh prompted the development of biologic matrices as a second category of hernia repair materials.
−Removed: Biologic matrices are derived from human or animal dermis, pericardium or intestinal submucosa, which allows them to become replaced entirely by the patient’s own tissue over time, a process known as remodeling.
+Added: Biologic matrices are derived from human or animal dermis, pericardium or intestinal submucosa, which allows them to become replaced entirely by the patient’s own tissue over time, a process known as remodeling.
The goal behind these biologic materials was to lower the foreign body inflammatory response and biomechanical requirements of the repair, while providing a matrix upon which tissue remodeling could occur.
7 unchanged sentences
Though hernia recurrence occurs with the use of all types of soft tissue reconstruction, biologic matrices have the highest rates of recurrence, in part as a result of being commonly used in complex hernia repairs or abdominal wall reconstructions.
−Removed: The RICH study, a multicenter, prospective study sponsored by LifeCell Corporation (“LifeCell”) that evaluated the performance of Strattice, the current market-leading biologic matrix, in open ventral incisional hernia repair in contaminated abdominal wall defects, demonstrated post operative hernia recurrence rates of 22% and 33% at 12‑months and 24‑months follow-up, respectively.
+Added: The RICH study, a multicenter, prospective study sponsored by LifeCell Corporation (“LifeCell”) that evaluated the performance of Strattice, the current market-leading biologic matrix, in open ventral incisional hernia
+Added: repair in contaminated abdominal wall defects, demonstrated post-operative hernia recurrence rates of 19% and 28% at 12-months and 24-months follow-up, respectively.
Resorbable Synthetic Mesh
10 unchanged sentences
Data from a recently published, multicenter, prospective study sponsored by C.R.
−Removed: that evaluated the performance of Phasix, the current market-leading resorbable synthetic mesh, in CDC Class I, high risk ventral and incisional hernia repair, showed a post operative hernia recurrence rate of 12% at 18‑months follow-up.
+Added: (now a subsidiary of Becton, Dickinson and Company) that evaluated the performance of Phasix, the current market-leading resorbable synthetic mesh, in CDC Class I, high risk ventral and incisional hernia repair, showed a post-operative hernia recurrence rate of 9% at 18-months follow-up and 18% at 36-month follow-up.
Current Materials Used in Plastic and Reconstructive Surgery and Their Limitations
4 unchanged sentences
Our portfolio of products, designed with over 95% biologic material, combines the benefits of both biologic and polymer materials while addressing their limitations by interweaving polymer fibers through layers of a minimally-processed biologic material.
−Removed: These products are priced competitively, and designed for use with a range of surgical techniques, allowing the benefits of an advanced biologic repair to be available to more patients.
+Added: These products are priced competitively, and designed for use with a range of surgical techniques, allowing the benefits of an advanced biologic repair to be available to more patients for use in accordance with the 510(k) clearances and the instructions for use.
The biologic material serves as the natural building block from which we can fabricate devices that meet specific clinical and surgical handling requirements.
1 unchanged sentence
Polymer fibers are interwoven through the layers of biologic material in unique embroidered patterns and contribute to less than 5% of the overall device by mass.
−Removed: The interwoven polymer utilized can be either permanent, made from polypropylene, or resorbable, made from polyglycolic acid (“PGA”).
+Added: The interwoven polymer utilized can be either permanent, made from polypropylene, or resorbable, made from polyglycolic acid (“PGA”).
The embroidering pattern varies between our OviTex and OviTex PRS portfolios to impart different biomechanical properties tailored for their respective intended clinical applications.
10 unchanged sentences
● Reduced foreign body inflammatory response.
−Removed: The biologic material utilized in our reinforced tissue matrices acts to reduce the body’s inflammatory response to the device.
+Added: The biologic material utilized in our reinforced tissue matrices acts to reduce the body’s inflammatory response to the device.
Our unique embroidered patterns create a macroporous grid within the biologic material.
8 unchanged sentences
In our non-human primate comparative study, at four weeks our OviTex products had host cells between and within the layers of the reinforced tissue matrix.
−Removed: We believe this early cell infiltration may reduce the potential for bacterial colonization and the risk for infection.
−Removed: In our OviTex BRAVO study, there were no wound infections that required surgical intervention or device removal in the first 32 patients who reached one year follow-up.
+Added: We believe this early cell infiltration may reduce the potential for bacterial colonization and the risk for infection, although we have not conducted comparative studies in humans.
● Highly engineered biomechanical properties with durability of results.
3 unchanged sentences
Data from our strength testing demonstrated that our OviTex products meet or exceed that of published data from market-leading permanent and resorbable synthetic mesh.
−Removed: In our BRAVO study, there were no hernia recurrences in the first 32 patients who reached one year follow-up, despite 80% of these patients having one or more factors known to increase the risk of recurrence.
−Removed: Based on this interim data, we believe that this 0% recurrence rate is the lowest reported rate in any prospective study that includes either our biologic or resorbable synthetic mesh competitors.
+Added: In our BRAVO study, there were two hernia recurrences in the 76 patients who reached
+Added: one year follow-up, despite approximately 85% of these patients having one or more factors known to increase the risk of recurrence.
+Added: Based on this data, we believe that this 2.6% recurrence rate is the lowest reported rate in any prospective study that includes either our biologic or resorbable synthetic mesh competitors.
The addition of polymer to our reinforced tissue matrices allows each product to maintain its physiologic compliance properties, while resisting stretching and elongation.
4 unchanged sentences
In interim data presented from our BRAVO study, of 26 subjects who received minimally invasive surgery, 100% of the surgeons who operated on those subjects cited the product as being easy to place and the average surgeon satisfaction with the product was 9.7/10 at both 30 and 90 days.
−Removed: In addition, we have designed an OviTex product for use in laparoscopic and robotic-assisted surgery.
+Added: In addition, we have designed OviTex LPR for use in laparoscopic and robotic-assisted surgery.
● Lower upfront cost products.
−Removed: Our reinforced tissue matrices provide our customers with meaningful cost savings over leading competitive products across a broad range of clinical uses so that more patients can experience the benefits of an advanced biologic repair solution.
+Added: Our reinforced tissue matrices provide our customers with meaningful cost savings over leading competitive products across a range of clinical uses so that more patients can experience the benefits of an advanced biologic repair solution.
We price our OviTex products competitively, and on average, our customers realize 20% to 40% cost savings over leading biologic matrices and resorbable synthetic mesh.
7 unchanged sentences
Our OviTex and OviTex PRS products are available in resorbable and permanent polymer versions in a variety of configurations and sizes.
−Removed: For example, our OviTex devices are currently available in sizes ranging from 4 ×
−Removed: 8 cm to 25 ×
−Removed: 40 cm, and our OviTex LPR devices are designed with specific thickness, handling properties and shapes optimized for use in laparoscopic and robotic-assisted surgery.
+Added: For example, our OviTex devices are currently available in sizes ranging from 4 × 8 cm to 25 × 40 cm, and our OviTex LPR devices are designed with specific thickness, handling properties and shapes optimized for use in laparoscopic and robotic-assisted surgery.
● Disruptive technology supported by compelling clinical evidence.
1 unchanged sentence
Our non-human primate data demonstrated that use of our OviTex products resulted in more rapid tissue integration and revascularization compared to biologic matrices and lower inflammatory response and better functional tissue remodeling compared to permanent and resorbable synthetic mesh.
−Removed: In our BRAVO study, the first 32 patients who reached one year at follow-up had demonstrated no ventral hernia recurrence, no explantations and no surgical site occurrences requiring follow-up surgery.
● Long-term supply agreement that provides pricing flexibility.
3 unchanged sentences
Our pricing flexibility allows us to sell our OviTex and OviTex PRS products to hospitals and healthcare systems at prices substantially below competitive products based on national average competitive pricing.
−Removed: Our OviTex products are sold at prices approximately 20% to 40% lower than other biologic matrices and resorbable synthetic mesh.
+Added: Our OviTex products are sold at prices
+Added: approximately 20% to 40% lower than other biologic matrices and resorbable synthetic mesh.
We believe our pricing flexibility will drive greater adoption of our products.
−Removed: Our OviTex PRS products are priced below leading biologic matrices, and as we launch our OviTex PRS portfolio, we anticipate that our customers will realize cost savings over biologic matrices based on national average competitive pricing.
+Added: Our OviTex PRS products are priced below leading biologic matrices, and as we continue our launch of our OviTex PRS portfolio, we anticipate that our customers will realize cost savings over biologic matrices based on national average competitive pricing.
We believe that the average selling prices across our products will provide financial benefits to our customers in addition to improving clinical outcomes.
4 unchanged sentences
● Broad intellectual property portfolio.
−Removed: Our products are covered by intellectual property that broadly covers changing a biologic matrix’s biomechanical properties by interweaving a polymer thread through the biologic matrix.
+Added: Our products are covered by intellectual property that broadly covers changing a biologic matrix’s biomechanical properties by interweaving a polymer thread through the biologic matrix.
Specifically, our patents claim the ability to tailor stretch resistance.
14 unchanged sentences
We sell our products through a single direct sales organization in the U.S.
−Removed: As of December 31, 2019, we had approximately 250 active hospital accounts, which are supported by 60 employees in our U.S.
+Added: As of December 31, 2020, we had 45 sales territories in the U.S.
+Added: and approximately 325 active hospital accounts, which are supported by 64 employees in our U.S.
based commercial organization.
−Removed: We plan to continue to invest in our commercial organization by adding account managers, clinical development specialists, business managers and administrative support staff in order to cover the highest potential of accounts for soft tissue reconstruction procedures.
+Added: We plan to continue to invest in our commercial organization by adding account managers, clinical development specialists and administrative support staff in order to support and service new accounts for soft tissue reconstruction procedures.
+Added: We believe we can also enhance the productivity of our sales force by improving customer segmentation and targeting, leveraging digital channels to engage customers and utilize engagement analytics to support development.
● Promote awareness of our products to drive surgeon use.
We educate surgeons regarding the value proposition of our products through presentations and exhibits at industry conferences, medical education symposia, direct training and education, webinars and publishing additional clinical data demonstrating the benefits of our products and establishing online peer-to-peer communities.
−Removed: We plan to continue to drive awareness of our products through these programs, while expanding their geographic reach and increasing the number of surgeon interactions.
+Added: In response to the restrictions resulting from the COVID-19 pandemic, we developed a virtual marketing sales solution as well.
+Added: our sales professionals have used this solution, which includes virtual sales calls with physicians, peer-to-peer discussions with key opinion leaders, physician webinars and sales professional training, instead of in-person sales and marketing programs.
+Added: We plan to continue to drive awareness of our products through these programs and continue to compliment the in-person visits with our virtual programs, while expanding their geographic reach and increasing the number of surgeon interactions.
+Added: We will continue to increase our digital marketing efforts as well to build brand awareness with event marketing engagement, targeted ads and emails, various social media efforts and patient education and outreach efforts.
● Drive utilization through existing GPO and IDN contracts and secure additional contracts.
4 unchanged sentences
We are committed to evidence-based medicine and investing in clinical data to support the use of our products.
−Removed: We plan to publish 90‑day, 12‑month and 24‑month follow-up data from our BRAVO study over the next several years.
+Added: We submitted our complete 12-month follow-up data from our BRAVO study in March 2021, and expect the complete study results by the end of 2021.
In addition, we are tracking the health economic outcomes within our BRAVO study.
−Removed: We also plan to initiate a post-market study of our OviTex products for robotic-assisted ventral hernia repair surgery in 2020.
+Added: We are in the process of starting the next post-market study of our OviTex products in robotic-assisted ventral hernia repair surgeries in early 2021.
We also intend to support independent investigator-led post-market clinical studies on the effectiveness and safety of our OviTex PRS products.
1 unchanged sentence
We plan to continue to expand our product offerings and the treatment capabilities of our products to address a broader patient base within soft tissue reconstruction.
−Removed: New product features and designs that we plan to introduce, subject to receiving any required regulatory approval or clearance, include:
−Removed: additional sizes and shapes of our OviTex LPR product line;
−Removed: a self-grip technology designed to enhance the use of our OviTex products in robotic-assisted surgery for inguinal and ventral hernia repair and enhancements to our OviTex PRS products to assist with surgical placement and tissue integration;
−Removed: larger OviTex sizes in our resorbable product line;
−Removed: the use of additional polymers, including for instance a longer-acting resorbable and high strength permanent synthetic, to incorporate into our OviTex and OviTex PRS products.
+Added: As we innovate and develop our products, the new features and improved surgical techniques expand the clinical applications for soft tissue reinforcement.
+Added: Areas of focus include enhanced surgical handling, increased permeability, and longer-acting resorbable polymers.
+Added: Improving the surgical handling and implementation of our devices benefits both the clinician and patient.
+Added: Increasing product permeability encourages a more-natural healing response.
+Added: Longer-acting polymers can provide additional support for patients that need more time to heal.
+Added: We believe these technology enhancements will continue to bolster our portfolio and expand the successful use of our products.
Our Technology Platform
7 unchanged sentences
PGA is the fastest resorbing polymer and within three months it tends to be fully absorbed into the body.
−Removed: Our highly specialized and customizable textile engineering capability allows us to tailor the degree and direction of stretch, overall strength, handling properties, permeability, thickness, texture, size and shape of each reinforced tissue matrix to suit the needs of particular clinical applications and surgical techniques.
+Added: Our highly specialized and customizable textile engineering capability allows us to tailor the degree and direction of stretch, overall strength, handling properties, permeability, thickness, texture, size and shape of each reinforced tissue
+Added: matrix to suit the needs of particular clinical applications and surgical techniques.
Our textile engineering utilizes a computer-controlled fabrication method that is scalable, reproducible, efficient and customizable.
−Removed: This embroidery process uses steel gauge needles to interweave the polymer while also creating hundreds of micro-channels to allow the multi-directional passage of the patients’
−Removed: native cells and fluids throughout the product.
+Added: This embroidery process uses steel gauge needles to interweave the polymer while also creating hundreds of micro-channels to allow the multi-directional passage of the patients’ native cells and fluids throughout the product.
The interwoven polymers are embroidered using a lockstitch pattern, which allows for the device to be trimmed without fraying, and we can use a patented corner-lock pattern, which creates a stable polymer fabric within the biologic material.
1 unchanged sentence
Denser grid patterns increase the amount of reinforcement and less dense patterns of different geometry allow for greater stretch.
−Removed: We are also able to manufacture products with smooth external layers that minimize the amount of exposed polymer to allow for direct contact with patients’
−Removed: internal organs.
+Added: We are also able to manufacture products with smooth external layers that minimize the amount of exposed polymer to allow for direct contact with patients’ internal organs.
OviTex Reinforced Tissue Matrix
9 unchanged sentences
The synthetic material in our OviTex products comprise less than 5% of our final product.
−Removed: Depending on the configuration
−Removed: selected, the amount of polymer is approximately 75% less than the polymer content of the most widely implanted permanent synthetic mesh, thereby reducing the patient’s foreign body inflammatory response to the polymer.
+Added: Depending on the configuration selected, the amount of polymer is approximately 75% less than the polymer content of the most widely implanted permanent synthetic mesh, thereby reducing the patient’s foreign body inflammatory response to the polymer.
We market a variety of OviTex products in a range of sizes, thicknesses and degrees of reinforcement in order to suit surgeon preference and desired surgical technique.
4 unchanged sentences
OviTex Laparoscopic and Robotic Procedures
−Removed: Our OviTex for Laparoscopic and Robotic Procedures (“OviTex LPR”) is a sterile reinforced tissue matrix derived from ovine rumen with polypropylene fiber intended to be used in laparoscopic and robotic-assisted hernia surgical repairs.
+Added: Our OviTex for Laparoscopic and Robotic Procedures (“OviTex LPR”) is a sterile reinforced tissue matrix derived from ovine rumen with polypropylene fiber intended to be used in laparoscopic and robotic-assisted hernia surgical repairs.
OviTex LPR was designed for use with a trocar and requires the same rehydration and fixation as our other OviTex products.
This product includes design elements to improve surgical handling, including two extra embroidered lines of blue colored polypropylene fibers to enhance endoscopic orientation and alignment.
−Removed: This product can be introduced into the patient’s body through various sized trocar ports.
+Added: This product can be introduced into the patient’s body through various sized trocar ports.
Based on surgeon feedback, OviTex LPR was designed in an elliptical or circular shape to minimize trimming.
+Added: OviTex Portfolio
Size and Shape
−Removed: 8 cm to 25 ×
−Removed: 40 cm* (Rectangle or Square)
−Removed: 8 cm to 25 ×
−Removed: 40 cm* (Rectangle or Square)
−Removed: 8 cm to 25 ×
−Removed: 40 cm* (Rectangle or Square)
+Added: 4 × 8 cm to 25 × 40 cm* (Rectangle or Square)
+Added: 4 × 8 cm to 25 × 40 cm* (Rectangle or Square)
+Added: 4 × 8 cm to 25 × 40 cm* (Rectangle or Square)
12 × 18cm (Ellipse);
22 unchanged sentences
Commercial Availability
−Removed: Europe (up to 20 ×
−Removed: Europe (up to 20 ×
−Removed: Europe (up to 20 ×
25 x 30 cm and 25 x 40 cm sizes currently only available with permanent (polypropylene) polymer.
Denotes relative level of strength
−Removed: OviTex Plastic and Reconstructive Surgery —
+Added: OviTex Plastic and Reconstructive Surgery — OviTex PRS
OviTex PRS, has received 510(k) clearance from the FDA, which clearance was obtained by Aroa and is held by us, and is indicated for use in implantation to reinforce soft tissue where weakness exists in patients requiring soft tissue repair or reinforcement in plastic and reconstructive surgery.
2 unchanged sentences
Machine punched regularly spaced fenestrations, or holes, and die-cut slits in the product facilitate fluid management, allow for rapid cellular infiltration and create a directional bias to the stretch.
−Removed: Our OviTex PRS product is available in arced rectangle, half-moon and oval shapes in a range of sizes (8 ×
−Removed: 15 cm through 20 ×
−Removed: 25 cm) to suit surgeon preference and nature of the soft tissue repair in plastic and reconstructive surgery.
+Added: Our OviTex PRS product is available in arced rectangle and half-moon shapes in a range of sizes (4 × 16 cm through 20 × 20 cm) to suit surgeon preference and nature of the soft tissue repair in plastic and reconstructive surgery.
The device may be trimmed to a desired shape to further accommodate individual anatomy.
−Removed: The shelf life of permanent OviTex PRS is 24 months and the shelf life of resorbable OviTex PRS is 12 months.
+Added: The current shelf life of permanent OviTex PRS is 24 months and the current shelf life of resorbable OviTex PRS is 8 to 12 months.
Product Pipeline and Research and Development
−Removed: We continue to expand our product pipeline and the treatment capabilities of our products through innovation, which we believe will expand the patient population that can benefit from our products to maximize their utility across surgical
−Removed: techniques and clinical applications for soft tissue reinforcement.
−Removed: New product features and designs that we plan to introduce, subject to receiving any required regulatory approval or clearance, include:
−Removed: additional sizes and shapes of our OviTex LPR product line;
−Removed: a self-grip technology designed to enhance the use of our OviTex products in robotic-assisted surgery for inguinal and ventral hernia repair and enhancements to our OviTex PRS products to assist with surgical placement and tissue integration of our OviTex PRS products;
−Removed: larger OviTex sizes in our resorbable product line;
−Removed: the use of additional polymers, including for instance a longer-acting resorbable and high strength permanent synthetic, to incorporate into our OviTex and OviTex PRS products.
+Added: We continue to advance our product pipeline to broaden our treatment capabilities for soft tissue reinforcement.
+Added: As we innovate and develop our products, the new features and improved surgical techniques expand the clinical applications for soft tissue reinforcement.
+Added: Areas of focus include enhanced surgical handling, increased permeability, and longer-acting resorbable polymers.
+Added: Improving the surgical handling and implementation of our devices benefits both the clinician and patient.
+Added: Increasing product permeability encourages a more-natural healing response.
+Added: Longer-acting polymers can provide additional support for patients that need more time to heal.
+Added: We believe these technology enhancements will continue to bolster our portfolio and expand the successful use of our products.
Clinical Results and Studies
4 unchanged sentences
We expect our clinical evidence will provide surgeons with safety and efficacy data on the appropriate use of our products and we plan to obtain further clinical evidence to support additional regulatory clearances or approvals of our reinforced tissue matrices for additional indications for use in the future.
−Removed: We believe we have completed the largest non-human primate preclinical studies conducted in soft tissue reconstruction surgery.
−Removed: Non-human primates are considered the most suitable animal model to predict the human immune and inflammatory response to a soft tissue reconstruction device.
+Added: We believe we have completed the largest non-human primate preclinical studies conducted in soft tissue reconstruction surgery and we expect to conduct additional non-human primate preclinical studies as part of our product development process.
+Added: Non-human primates are considered the most suitable animal model to predict the human immune and inflammatory responses to soft tissue reconstruction devices.
Although not required for FDA clearance of our reinforced tissue matrices, we completed these preclinical studies prior to implantation of our products in human patients.
In these studies, we compared our OviTex and OviTex PRS products to market leading competitive materials.
−Removed: In these studies, our reinforced tissue matrices exhibited a minimal inflammatory response, rapid cellular infiltration and revascularization and allowed for earlier and complete remodeling into functional tissue.
+Added: In these studies, our reinforced tissue matrices exhibited a minimal inflammatory response, rapid cellular infiltration and revascularization and demonstrated early and complete remodeling into functional tissue.
We are currently sponsoring our BRAVO study.
−Removed: An analysis of the first 32 patients who underwent surgery and completed the twelve-month follow-up visit showed a 0% rate of hernia recurrence, no device explantations and no predefined surgical site complications or wound-related events requiring surgical intervention.
+Added: The study was fully enrolled at 92 patients.
+Added: The interim analysis includes patient cohorts at the 90-day, 12-month and 24-month follow-up periods.
+Added: At 90 days post-operative, there were no recurrences or reoperations among 84 of the patients analyzed.
+Added: There was one implant removal due to a bowel perforation.
+Added: The final 12-month analysis includes 76 patients, of whom two patients experienced a recurrence, both adjacent to the original repair, with the OviTex repairs remaining intact.
+Added: Twenty patients experienced a surgical site
+Added: occurrence of whom ten required a procedural intervention such as wound debridement or percutaneous drainage.
+Added: None required a surgical intervention.
+Added: Of the 51 patients that have reached 24-month follow-up, one patient experienced a surgical site occurrence and none experienced a recurrence or long-term complication.
+Added: Additional results from the 30-day and 24-month patient cohorts showing low rates of surgical site occurrences requiring treatment were presented in September 2020 at the Americas Hernia Society Annual Meeting.
This clinical study included patients with a range of comorbidities, prior hernia repairs and history of surgical infections, predisposing them to complications.
−Removed: These patients were treated using either an open or minimally invasive surgical approach.
+Added: Excluded were morbidly obese patients (BMI > 40 kg/m 2 ) and those with a CDC wound class 4 (dirty/infected).
+Added: The patients were treated using either an open or minimally invasive surgical approach.
These findings are generally corroborated by similar clinical data from multiple published retrospective studies in a variety of hernia repairs utilizing our OviTex products.
1 unchanged sentence
Our OviTex PRS reinforced tissue matrices have also been evaluated in a non-human primate model and demonstrated less inflammation and earlier remodeling into functional tissue than the leading biologic matrix used in plastic and reconstructive surgical procedures.
−Removed: Surgeons are beginning to utilize our OviTex PRS reinforced tissue matrices in their surgeries and we plan to continuously collect, analyze and support the presentation of clinical data to characterize the performance of our reconstructive reinforced tissue matrices.
−Removed: We also intend to support independent investigator-led post-market clinical studies on the effectiveness and safety of our OviTex PRS products.
−Removed: Our BRAVO Study
−Removed: We are sponsoring our BRAVO study, a prospective, single arm, multicenter study evaluating the clinical outcomes of 91 patients with simple and complex ventral hernias repaired with our OviTex 1S with permanent polymer.
−Removed: The study completed enrollment of 91 adult patients who underwent open, laparoscopic or robotic-assisted ventral hernia repair at seven centers in the U.S.
−Removed: between April 2017 and June 2019.
−Removed: The study was designed to test the hypothesis that the strong preclinical biologic performance and predictable biomechanics of our OviTex reinforced tissue matrices would translate into better clinical performance than that of biologic or synthetic devices for hernia repair.
−Removed: No study center contributed more than 19% of patients enrolled.
−Removed: The primary endpoints of this study are the incidence of early postoperative surgical site occurrences or wound-related events noted at the hernia repair site and the incidence of other postoperative complications, in each case occurring within the first three months of the ventral hernia repair.
−Removed: These include deep or superficial wound infection, seroma, hematoma, wound dehiscence, skin necrosis and fistulas.
−Removed: Hernia recurrence is evaluated at each follow-up visit.
−Removed: In the case of a clinical suspicion by the surgeon of a recurrence, imaging studies are performed.
−Removed: Patients enrolled in the study are evaluated at 30 days, three months, 12 months and 24 months, with interim analysis of patients being conducted for each 25 patient cohort that reaches the three- and twelve-month follow-up period after implantation of our OviTex product.
−Removed: Patients presenting with a primary or recurrent ventral hernia were eligible for the study, with the exception of those with a Body Mass Index, or BMI, of over 40 kg/m 2 , a Center for Disease Control, or CDC, Class IV/Dirty-Infected wound, or defects requiring devices larger than 20 ×
−Removed: 20 cm or 18 ×
−Removed: 22 cm, and other typical exclusion criteria.
−Removed: The secondary endpoints of this study are incidence of late postoperative surgical site occurrences or wound-related events noted at the hernia repair site and occurring more than three months after surgery, incidence of other late postoperative complications occurring more than three months after surgery or true hernia recurrence at the site of surgery at three months, 12 months or 24 months after the hernia repair.
−Removed: The first 32 patients who have undergone surgery and completed the one-year follow-up visit have been evaluated.
−Removed: Excluded were two patients who withdrew from the study, one patient who is still active but has missed their one-year visit, and three subjects who died within three weeks of surgery due to causes unrelated to our OviTex product or the study procedure.
−Removed: While many factors can influence surgical wound healing and postoperative infection, bacterial burden is the most significant risk factor.
−Removed: The CDC wound class is a surgical wound classification system designed by the CDC to help clinicians preemptively identify patients at risk of surgical site infection and assess the degree of bacterial contamination of a surgical wound at the time of operation.
−Removed: The CDC identifies four surgical wound classification categories:
−Removed: Class I/Clean;
−Removed: Class II/Clean-Contaminated;
−Removed: Class III/Contaminated;
−Removed: and Class IV/Dirty-Infected.
−Removed: The Ventral Hernia Working Group (“VHWG”) grade is a hernia grading system based on risk factor characteristics of the patient and the wound that helps surgeons develop patient assessment strategies, including the selection of appropriate repair material, the appropriate surgical technique and overall clinical approach based on each patient’s risk for developing a surgical site occurrence and postoperative complications.
−Removed: This surgical site occurrence-risk grading system consists of four grades:
−Removed: Grade 1/Low Risk;
−Removed: Grade 2/Co-Morbid;
−Removed: Grade 3/Potentially Contaminated;
−Removed: and Grade 4/Infected.
−Removed: This grading system represents salient points along a continuum of risk from low risk (healthy patients with uncomplicated wounds) to high-risk (patients with multiple comorbidities and uncontrolled infection).
−Removed: The demographics of the 32 patients, as well as the number of previous hernia repairs, history of surgical infection, wound status, VHWG classification, obesity classification approach and self-reported patient and surgeon satisfaction are presented in the table below.
−Removed: BRAVO Study Data
−Removed: Comorbidities
−Removed: Diabetes Mellitus
−Removed: Previous Ventral Hernia Repair
−Removed: Smoking History
−Removed: Prior Hernia Repairs
−Removed: History of Surgical Infection
−Removed: Obesity Classification
−Removed: Morbidly Obese
−Removed: Robotic-assisted
−Removed: Represents the number of patients out of the first 32 patients
−Removed: The table below presents publicly available recurrence data for other biological matrix and resorbable synthetic mesh products in prospective clinical studies in ventral hernia repair presented in published clinical literature and conference presentations.
−Removed: Recurrence rates are calculated as the number of hernia recurrence at the time of follow-up divided by the number of patients who completed follow-up at the same time period.
−Removed: Hernia Recurrence Rate based on number of hernia recurrences reported in patients who completed follow up and patients who reported recurrent hernia before the specified follow up period.
−Removed: Clinical literature and conference presentations included hernia recurrence rates based on number of hernia recurrences in patients who comprised the initial intent-to-treat population (including those who did not complete the follow up period and did not report a hernia recurrence).
−Removed: The table below presents the recurrence rate for the first 32 patients who reached 12‑month follow-up in our BRAVO study.
−Removed: Reinforcement
−Removed: Reinforced Tissue Matrix
−Removed: None of the first 32 patients who reached the one-year follow-up period had experienced a recurrence at that time (0 of 32;
−Removed: In this study, nine patients experienced surgical site occurrences, of which five were considered possibly related to the device (5 of 32;
−Removed: Of these five surgical site occurrences, four were infections (abdominal wall abscesses), and one was a seroma.
−Removed: None of the surgical site occurrences required further surgery or removal of the device, and all surgical site occurrences had resolved by the time of the 90‑day follow-up visit.
−Removed: All nine patients had comorbidities that are known to increase the risks of surgical site occurrences, including obesity in seven, diabetes mellitus in one, chronic obstructive pulmonary disease in one, hypertension in five, one to five previous ventral hernia repairs in seven (average of 2.7 prior ventral hernia repairs) and previous surgical infections in three.
−Removed: Patient satisfaction for the completed patients was 9.3 out of 10 at the one-year follow-up and surgeon satisfaction at that time was 9.8 out of 10.
−Removed: Our OviTex product was considered easy or very easy to use in all cases, whether open or minimally invasive.
−Removed: The first planned 12‑month analysis of this study showed no device failures requiring explantation, reoperation or recurrences, thereby demonstrating the strong biologic and biomechanical performance of our OviTex reinforced tissue matrices.
−Removed: Our 0% 12‑month recurrence rate compares favorably to the reported 12‑month recurrence rates in published
−Removed: prospective studies for Phasix, and Strattice, which were 5.0%, and 22%, respectively.
−Removed: We believe that our OviTex reinforced tissue matrices better tolerate an infected environment as demonstrated by our 0% explantation rate.
−Removed: As the BRAVO data continues to mature, we have recently conducted analysis on the first patient cohort at 24-months and expanded cohorts at 12-months and 90-days.
−Removed: We have submitted these data to upcoming medical conferences for presentation.
+Added: Surgeons are beginning to utilize our OviTex PRS reinforced tissue matrices in their surgeries and we plan to collect, analyze and support the presentation of clinical data to characterize the performance of our reconstructive reinforced tissue matrices.
+Added: We also intend to support independent investigator initiated retrospective clinical studies on the effectiveness and safety of our OviTex PRS products.
Preclinical In Vivo Evaluation of our OviTex Product in Non-Human Primates
2 unchanged sentences
This non-human primate model has been used extensively to evaluate clinical and immune responses to pathogens, vaccines, and pharmaceuticals, and to predict xenograft biocompatibility for abdominal wall repair.
−Removed: In accordance with the study protocol, the animals were anesthetized and a 7 ×
−Removed: 3 cm full thickness “window”
−Removed: defect was created in the midline of the abdominal wall.
+Added: In accordance with the study protocol, the animals were anesthetized and a 7 × 3 cm full thickness “window” defect was created in the midline of the abdominal wall.
The defect was then repaired with a reconstruction material of equal size, which was sutured in place to repair the defect and the skin was then sutured closed.
7 unchanged sentences
Source Materials
−Removed: Point (weeks)
+Added: Explant Time Point (weeks)
OviTex PGA 1S
3 unchanged sentences
Ovine rumen embroidered with polypropylene
−Removed: Strattice Firm
−Removed: LifeCell Corporation (now Allergan)
−Removed: Porcine dermis
Resorbable Synthetic
3 unchanged sentences
Polypropylene with hydrogel barrier
+Added: Permanent Synthetic
+Added: Polypropylene laminated between polyglecaprone-25 films bond with polydioxanone film
+Added: Strattice Firm
+Added: LifeCell Corporation (now Allergan)
+Added: Porcine dermis
+Added: SurgiMend 1.0
+Added: TEI Biosciences (now Integra)
+Added: Fetal bovine dermis
+Added: Gentrix Surgical Matrix Plus
+Added: Porcine urinary bladder matrix
+Added: Hybrid Biologic
+Added: Porcine small intestinal submucosa
At 24 weeks, our OviTex reinforced tissue matrices best preserved their original geometry and exhibited limited contraction, had minimal inflammation, had rapid cellular infiltration and vascularization, and the grafts fully remodeled into host tissue (fastest rate of remodeling) with a higher degree of organized collagen than synthetics and biologics (on average).
9 unchanged sentences
Our resorbable and permanent OviTex PRS products were evaluated in a non-human primate study, in which our OviTex PRS product was compared to AlloDerm at two, four, 12 and 24 weeks for differences in healing kinetics, as evidenced through inflammatory response, cellular infiltration, and the morphological quality of the newly remodeled tissue associated with each device.
−Removed: The inflammatory response for both the OviTex PRS groups and AlloDerm was minimal, though when comparing the two the response was slightly lower in our resorbable OviTex PRS product at all time points, including the last 24 weeks.
+Added: The inflammatory response for both the OviTex PRS groups and AlloDerm was minimal throughout, though the histiocytic response was higher in AlloDerm at the 4- and 12-week time points, decreasing by 24 weeks, but still slightly higher than in our resorbable OviTex PRS product.
At four weeks, the highly permeable nature of our OviTex PRS product design enhanced fluid exchange evidenced by more effective and rapid infiltration of host cells in the collagen network.
In comparison, the collagen network of AlloDerm developed a superficial layer of fibroblasts, covering the device, which macroscopically appeared white and largely inert.
−Removed: The earlier infiltration and faster recruitment of fibroblasts and host cells in our OviTex PRS product helped “jump start”
−Removed: the remodeling process into host tissue.
+Added: The earlier infiltration and faster recruitment of fibroblasts and host cells in our OviTex PRS product helped “jump start” the
+Added: remodeling process into host tissue.
At 12 weeks, our OviTex PRS product was fully remodeled and the maturation of the product was slightly ahead of that of AlloDerm at all time points.
6 unchanged sentences
We also rely on know-how and continuing technological innovation to develop and maintain our competitive position.
−Removed: In August 2012, we entered into the Aroa License, which was amended and restated in July 2015, pursuant to which we obtained an exclusive license to certain patents and know-how to develop, commercialize and sell bovine and ovine extracellular matrix products for hernia repair, abdominal wall and breast reconstruction in North America and Europe,
−Removed: which we refer to as the Licensed Territory.
+Added: In August 2012, we entered into the Aroa License, which was amended and restated in July 2015, pursuant to which we obtained an exclusive license to certain patents and know-how to develop, commercialize and sell bovine and ovine extracellular matrix products for hernia repair, abdominal wall and breast reconstruction in North America and Europe, which we refer to as the Licensed Territory.
In addition, under the Aroa License, Aroa is our exclusive manufacturer and supplier for the development of our products.
6 unchanged sentences
Pursuant to the Aroa License, we retain 73% of the net sales of all of our products and pay Aroa the remaining 27%.
−Removed: If at any point during the term of the Aroa License we and Aroa determine that our anticipated product needs exceed Aroa’s manufacturing capabilities, we and Aroa will mutually approve an expansion and equally share the cost of such expansion.
+Added: If at any point during the term of the Aroa License we and Aroa determine that our anticipated product needs exceed Aroa’s manufacturing capabilities, we and Aroa will mutually approve an expansion and equally share the cost of such expansion.
Our share of such expansion costs may be offset by us against future revenue share payments.
−Removed: The initial term of the Aroa License terminates on the later of (i) August 3, 2022, or (ii) the expiration of the last patent covering bovine and ovine products currently July 30, 2029, with an option to extend for an additional ten year period.
−Removed: Either party may terminate the Aroa License upon the other party’s material breach, subject to a ninety-day notice and cure period or upon thirty-days written notice in the event of bankruptcy.
+Added: The initial term of the Aroa License terminates on the later of (i) August 3, 2022, or (ii) the expiration of the last patent covering bovine and ovine products currently April 19, 2031, with an option to extend for an additional ten year period.
+Added: Either party may terminate the Aroa License upon the other party’s material breach, subject to a ninety-day notice and cure period or upon thirty-days written notice in the event of bankruptcy.
We may terminate manufacture and production of a specific product upon thirty-days prior written notice upon (i) a reasonable determination that such product infringes the intellectual property rights of a third party, (ii) an uncured supply failure by Aroa or (iii) such product proves unfeasible, and immediately upon written notice from a regulatory authority that such product must be withdrawn from the market.
4 unchanged sentences
patents that will expire in 2029 and 2031.
−Removed: We own seven U.S.
−Removed: issued or allowed patents which will expire between 2035 and 2037 and six pending U.S.
+Added: We own ten U.S.
+Added: issued or allowed patents which will expire between 2035 and 2038 and eight pending U.S.
patent applications, which subject to issuance, are projected to expire between 2035 and 2040, without taking into account potential patent term extensions or adjustments.
4 unchanged sentences
Although the term of individual patents varies depending upon the country in which they were granted, in most countries, including the U.S., the patent term is 20 years from the earliest claimed filing date of a non-provisional patent application in the applicable country.
−Removed: In the U.S., a patent’s term may, in certain cases, be lengthened by patent term adjustment, which compensates a patentee for administrative delays by the U.S.
+Added: In the U.S., a patent’s term may, in certain cases, be lengthened by patent term adjustment, which compensates a patentee for administrative delays by the U.S.
Patent and Trademark Office in examining and granting a patent, or may be shortened if a patent is terminally disclaimed over a commonly owned patent or a patent naming a common inventor and having an earlier expiration date.
6 unchanged sentences
We also rely on trademarks and trade designs to develop and maintain our competitive position.
−Removed: TELA Bio ®
−Removed: , OviTex ®
−Removed: and OviTex PRS ®
−Removed: are registered trademarks of ours in the U.S.
−Removed: For more information regarding the risks related to our intellectual property, please see the section titled “Risk Factors —
−Removed: Risks Related to Our Intellectual Property Matters.”
+Added: TELA Bio ® , OviTex ® and OviTex PRS ® are registered trademarks of ours in the U.S.
+Added: For more information regarding the risks related to our intellectual property, please see the section titled “Risk Factors — Risks Related to Intellectual Property Matters.”
Research and Development
3 unchanged sentences
We have a number of design improvements for our reinforced tissue matrices in various stages of development that are expected to enhance our current products and increase surgeon adoption of our products.
−Removed: In addition, we intend to engage in discussions with the FDA regarding an IDE protocol to study the safety and effectiveness of our OviTex PRS portfolio for an indication in breast reconstruction surgery.
+Added: In addition, we intend to engage in discussions with the FDA regarding an
+Added: IDE protocol to study the safety and effectiveness of our OviTex PRS portfolio for an indication in breast reconstruction surgery.
+Added: The FDA has stated that a PMA, rather than 510(k) clearance, will be required for such an indication.
Our research and development efforts are based at our facility in Malvern, Pennsylvania.
10 unchanged sentences
based commercial organization in 45 sales territories, which includes account managers and administrative support staff.
−Removed: We plan to continue to invest in our commercial organization by adding account managers, clinical development specialists, business managers and administrative support staff in order to cover the highest potential of accounts for soft tissue reconstruction procedures.
+Added: We plan to continue to invest in our commercial organization by adding account managers, clinical development specialists and administrative support staff in order to cover the highest potential of accounts for soft tissue reconstruction procedures.
Manufacturing
−Removed: All of our raw materials are sourced through and manufactured by Aroa in their Auckland, New Zealand facility under the terms of the Aroa License.
−Removed: Aroa’s facility is approximately 25,000 square feet of which approximately 10,000 square feet is dedicated to manufacturing.
−Removed: This facility is currently undergoing a short-term expansion to increase capacity with additional process equipment and work shifts, and a further intermediate-term expansion is planned, with approximately 15,000 square feet of additional manufacturing space available.
+Added: All our raw materials are sourced through and manufactured by Aroa in their Auckland, New Zealand facility under the terms of the Aroa License.
+Added: Aroa’s facility is approximately 25,000 square feet of which approximately 10,000 square feet is dedicated to manufacturing.
+Added: This facility recently completed a short-term expansion to increase capacity with additional process equipment and work shifts, and a further intermediate-term expansion is planned in 2021, with approximately 15,000 square feet of additional manufacturing space available.
Expansions are mutually agreed between us and Aroa, and under the terms of the Aroa License we share 50% of the expansion cost, which we may later offset against our revenue share payment to Aroa.
6 unchanged sentences
The sheep receive veterinary inspection prior to slaughter and then each carcass is inspected post-mortem for the presence of disease according to USDA approved standards.
−Removed: Only sheep which pass full inspection can be used as a raw tissue source for our products and all of the ovine rumen is processed in compliance with the FDA’s regulations for Medical Devices Containing Materials Derived from Animal Sources.
+Added: Only sheep which pass full inspection can be used as a raw tissue source for our products and all the ovine rumen is processed in compliance with the FDA’s regulations for Medical Devices Containing Materials Derived from Animal Sources.
Once the ovine rumen is procured, our reinforced tissue matrix products are then manufactured by Aroa at its facility in Auckland, New Zealand.
3 unchanged sentences
The medical device industry is intensely competitive, subject to change and significantly affected by new product introductions and other market activities of industry participants.
−Removed: In the hernia repair market our primary competitors are Davol Inc., a subsidiary of C.R.
−Removed: Bard, Inc., which produces Phasix and Ventralight ST, and LifeCell, a subsidiary of Allergan, which produces Strattice.
−Removed: In the plastic and reconstructive surgery market, our primary competitor is LifeCell, a subsidiary of Allergan, which produces AlloDerm.
+Added: In the hernia repair market our primary competitors are Bard, a subsidiary of Becton, Dickinson and Company, which produces Phasix and Ventralight ST, and LifeCell, a subsidiary of AbbVie, which produces Strattice.
+Added: In the plastic and reconstructive surgery market, our primary competitor is LifeCell, a subsidiary of AbbVie, which produces AlloDerm.
Many of these competitors are large, well-capitalized companies with significantly greater market share and resources than we have.
21 unchanged sentences
All of our medical devices sold in the U.S.
−Removed: are subject to the Federal Food, Drug, and Cosmetic Act (“FDCA”) as implemented and enforced by the FDA.
+Added: are subject to the Federal Food, Drug, and Cosmetic Act (“FDCA”) as implemented and enforced by the FDA.
Unless an exemption applies, each new or significantly modified medical device we seek to commercially distribute in the U.S.
−Removed: will require either a premarket notification to the FDA requesting permission for commercial distribution under Section 510(k) of the FDCA also referred to as a 510(k) clearance, or approval from the FDA of a Premarket Approval application (“PMA”).
+Added: will require either a premarket notification to the FDA requesting permission for commercial distribution under Section 510(k) of the FDCA also referred to as a 510(k) clearance, or approval from the FDA of a PMA application.
Both the 510(k) clearance and PMA processes can be resource intensive, expensive, and lengthy, and require payment of significant user fees, unless an exemption is available.
Device Classification
−Removed: Under the FDCA, medical devices are classified into one of three classes —
−Removed: Class I, Class II or Class III —
−Removed: depending on the degree of risk associated with each medical device and the extent of control needed to provide reasonable assurances with respect to safety and effectiveness.
+Added: Under the FDCA, medical devices are classified into one of three classes — Class I, Class II or Class III — depending on the degree of risk associated with each medical device and the extent of control needed to provide reasonable assurances with respect to safety and effectiveness.
+Added: Class I includes devices with the lowest risk to the patient and are those for which safety and effectiveness can be reasonably assured by adherence to a set of FDA regulations, referred to as the General Controls for Medical Devices, which require compliance with the applicable portions of the Quality Systems Regulations, or QSR, facility registration and product listing, reporting of adverse events and malfunctions, and appropriate, truthful and non-misleading labeling and promotional materials.
+Added: Some Class I devices, also called Class I reserved devices, also require premarket clearance by the FDA through the 510(k) premarket notification process described below.
+Added: Most Class I products are exempt from the premarket notification requirements.
+Added: Class II devices are those that are subject to the General Controls, and special controls as deemed necessary by the FDA to ensure the safety and effectiveness of the device.
+Added: These special controls can include performance standards, patient registries, FDA guidance documents and post-market surveillance.
+Added: Most Class II devices are subject to premarket review and clearance by the FDA.
+Added: Premarket review and clearance by the FDA for Class II devices is accomplished through the 510(k) premarket notification process.
+Added: Class III devices include devices deemed by the FDA to pose the greatest risk such as life-supporting or life-sustaining devices, or implantable devices, in addition to those deemed novel and not substantially equivalent to a medical device cleared through the 510(k) process.
+Added: The safety and effectiveness of Class III devices cannot be reasonably assured solely by the General Controls and special controls described above.
+Added: Therefore, these devices are subject to the PMA application process, which is generally more costly and time consuming than the 510(k) process.
+Added: Through the PMA application process, the applicant must submit data and information demonstrating reasonable assurance of the safety and effectiveness of the device for its intended use to the FDA’s satisfaction.
+Added: Accordingly, a PMA application typically includes, but is not limited to, extensive technical information regarding device design and development, preclinical and clinical trial data, manufacturing information, labeling and financial disclosure information for the clinical investigators in device studies.
+Added: The PMA application must provide valid scientific evidence that demonstrates to the FDA’s satisfaction a reasonable assurance of the safety and effectiveness of the device for its intended use.
510(k) Clearance Pathway
3 unchanged sentences
As a practical matter, clearance often takes nine to twelve months, but may take significantly longer.
−Removed: To demonstrate substantial equivalence, the manufacturer must show
−Removed: that the proposed device has the same intended use as the predicate device, and it either has the same technological characteristics, or different technological characteristics and the information in the pre-market notification demonstrates that the device is equally safe and effective and does not raise different questions of safety and effectiveness.
+Added: To demonstrate substantial equivalence, the manufacturer must show that the proposed device has the same intended use as the predicate device, and it either has the same technological characteristics, or different technological characteristics and the information in the pre-market notification demonstrates that the device is equally safe and effective and does not raise different questions of safety and effectiveness.
The FDA may require further information, including clinical data, to make a determination regarding substantial equivalence.
If the FDA agrees that the device is substantially equivalent to a predicate device currently on the market, it will grant 510(k) clearance to commercially market the device.
−Removed: If the FDA determines that the device is “not substantially equivalent”
−Removed: to a previously cleared device, the device is automatically designated as a Class III device.
+Added: If the FDA determines that the device is “not substantially equivalent” to a previously cleared device, the device is automatically designated as a Class III device.
The device sponsor must then fulfill more rigorous PMA requirements, or can request a risk-based classification determination for the device in accordance with the de novo classification procedure, which is a route to market for novel medical devices that are low to moderate risk and are not substantially equivalent to a predicate device.
After a device receives 510(k) marketing clearance, any modification that could significantly affect its safety or effectiveness, or that would constitute a major change or modification in its intended use, will require a new 510(k) marketing clearance or, depending on the modification, a de novo classification or PMA approval.
−Removed: The FDA requires each manufacturer to determine whether the proposed change requires submission of a 510(k) or a PMA in the first instance, but the FDA can review any such decision and disagree with a manufacturer’s determination.
+Added: The FDA requires each manufacturer to determine whether the proposed change requires submission of a 510(k) or a PMA in the first instance, but the FDA can review any such decision and disagree with a manufacturer’s determination.
Many minor modifications today are accomplished by a manufacturer documenting the change in an internal letter-to-file.
1 unchanged sentence
The FDA can always review these letters-to-file in an inspection.
−Removed: If the FDA disagrees with a manufacturer’s determination, the FDA can require the manufacturer to cease marketing and/or request the recall of the modified device until 510(k) marketing clearance or PMA approval is obtained.
+Added: If the FDA disagrees with a manufacturer’s determination, the FDA can require the manufacturer to cease marketing and/or request the recall of the modified device until 510(k) marketing clearance or PMA approval is obtained.
Also, in these circumstances, we may be subject to significant regulatory fines or penalties.
−Removed: The FDA is currently considering proposals to reform its 510(k) marketing clearance process, and such proposals could include increased requirements for clinical data and a longer review period.
−Removed: In November 2018, FDA officials announced forthcoming steps that the FDA intends to take to modernize the premarket notification pathway under Section 510(k) of the FDCA.
−Removed: Among other things, the FDA announced that it plans to develop proposals to drive manufacturers using the 510(k) pathway toward the use of newer predicates.
−Removed: These proposals include plans to potentially sunset certain older devices that were used as predicates under the 510(k) clearance pathway, and to potentially publish a list of devices that have been cleared on the basis of demonstrated substantial equivalence to predicate devices that are more than 10 years old.
−Removed: The FDA also announced that it intends to finalize guidance to establish a premarket review pathway for “manufacturers of certain well-understood device types”
−Removed: as an alternative to the 510(k) clearance pathway and that such premarket review pathway would allow manufacturers to rely on objective safety and performance criteria recognized by the FDA to demonstrate substantial equivalence, obviating the need for manufacturers to compare the safety and performance of their medical devices to specific predicate devices in the clearance process.
−Removed: These proposals have not yet been finalized or adopted, and the FDA announced that it would seek public feedback prior to publication of any such proposals, and may work with Congress to implement such proposals through legislation.
+Added: The FDA has undertaken efforts to modernize the 510(k) clearance process.
+Added: In January 2019, the agency finalized guidance outlining the framework for the Safety and Performance Based Pathway.
+Added: This option for 510(k) clearance will allow manufacturers to use objective performance criteria established or recognized by the FDA to facilitate demonstration of substantial equivalence of their new products to legally marketed devices.
+Added: This new pathway will ensure that the performance characteristics of new devices are evaluated against a set of objective, transparent and well-validated safety and performance metrics.
+Added: Devices using this pathway will still have to meet current standards for reasonable assurance of safety and effectiveness before they can be marketed.
+Added: De Novo Classification
+Added: Medical device types that the FDA has not previously classified as Class I, II or III are automatically classified into Class III regardless of the level of risk they pose.
+Added: The Food and Drug Administration Modernization Act of 1997, or FDAMA, established a new route to market for low to moderate risk medical devices that are automatically placed into Class III due to the absence of a predicate device, called the “Request for Evaluation of Automatic Class III Designation,” or the de novo classification procedure.
+Added: This procedure allows a manufacturer whose novel device is automatically classified into Class III to request down-classification of its medical device into Class I or Class II on the basis that the device presents low or moderate risk, rather than requiring the submission and approval of a PMA application.
+Added: Prior to the enactment of the Food and Drug Administration Safety and Innovation Act of 2012, or FDASIA, a medical device could only be eligible for de novo classification if the manufacturer first submitted a 510(k) pre-market notification and received a determination from the FDA that the device was not substantially equivalent to a predicate device.
+Added: FDASIA streamlined the de novo classification pathway by permitting manufacturers to request de novo classification directly without first submitting a 510(k) pre-market notification to the FDA and receiving a not substantially equivalent determination.
+Added: Under FDASIA, the FDA is required to classify the device within 120 days following receipt of the de novo application.
+Added: If the manufacturer seeks reclassification into Class II, the manufacturer must include a draft proposal for special controls that are necessary to provide a reasonable assurance of the safety and effectiveness of the medical device.
+Added: In addition, the FDA may reject the reclassification petition if it identifies a legally marketed predicate device that would support a 510(k) or determines that the device is not low to moderate risk or that general controls would be inadequate to control the risks and special controls cannot be developed.
+Added: The PMA Approval Process
+Added: Class III devices require PMA approval before they can be marketed although some pre-amendment Class III devices for which the FDA has not yet required a PMA are cleared through the 510(k) process.
+Added: The PMA process is more demanding than the 510(k) premarket notification process.
+Added: In a PMA, the manufacturer must demonstrate that the device is safe and effective, and the PMA must be supported by extensive data, including data from preclinical studies and human clinical trials.
+Added: The PMA must also contain a full description of the device and its components, a full description of the methods, facilities and controls used for manufacturing, and proposed labeling.
+Added: While our current products are subject to the 510(k) clearance pathway, any future products or modifications to our existing products that we plan to develop for a breast reconstruction indication would be subject to the PMA approval process.
+Added: Following receipt of a PMA application, the FDA determines whether the application is sufficiently complete to permit a substantive review.
+Added: If it is not, the agency will refuse to file the PMA.
+Added: If it is, the FDA will accept the application for filing and begin the review.
+Added: The FDA has 180 days to review a filed PMA application, although the review of an application can occur over a significantly longer period of time, and can take up to several years.
+Added: During this review period, the FDA may request additional information or clarification of information already provided, or the FDA may issue a major deficiency letter to the applicant, requesting the applicant’s response to deficiencies communicated by the FDA.
+Added: The FDA considers a PMA or PMA supplement to have been voluntarily withdrawn if an applicant fails to respond to an FDA request for information (e.g., a major deficiency letter) within 360 days.
+Added: Before approving or denying a PMA, an FDA advisory committee may review the PMA at a public meeting and provide the FDA with the committee’s recommendation on whether the FDA should approve the submission, approve it with specific conditions, or not approve it.
+Added: The FDA is not bound by the recommendations of an advisory committee, but it considers such recommendations carefully when making decisions.
+Added: Prior to approval of a PMA, the FDA may conduct inspections of the clinical trial data and clinical trial sites, as well as inspections of the manufacturing facility and processes.
+Added: Overall, the FDA review of a PMA application generally takes between one and three years, but may take significantly longer.
+Added: The FDA will approve the new device for commercial distribution if it determines that the data and information in the PMA constitute valid scientific evidence and that there is reasonable assurance that the device is safe and effective for its intended use(s).
+Added: If the FDA evaluation of a PMA is favorable, the FDA will issue either an approval letter, or an approvable letter, the latter of which usually contains a number of conditions that must be met in order to secure final approval of the PMA.
+Added: When and if those conditions have been fulfilled to the satisfaction of the FDA, the agency will issue a PMA approval letter authorizing commercial marketing of the device, subject to the conditions of approval and the limitations established in the approval letter.
+Added: If the FDA’s evaluation of a PMA application or manufacturing facilities is not favorable, the FDA will deny approval of the PMA or issue a not approvable letter.
+Added: The FDA also may determine that additional tests or clinical trials are necessary, in which case the PMA approval may be delayed for several months or years while the trials are conducted and data is submitted in an amendment to the PMA, or the PMA is withdrawn and resubmitted when the data are available.
+Added: The FDA may condition PMA approval on some form of post-market surveillance when deemed necessary to protect the public health or to provide additional safety and efficacy data for the device in a larger population or for a longer period of use.
+Added: In such cases, the manufacturer might be required to follow certain patient groups for a number of years and to make periodic reports to the FDA on the clinical status of those patients.
+Added: Failure to comply with the conditions of approval can result in material adverse enforcement action, including withdrawal of the approval.
+Added: New PMA applications or PMA supplements are required for changes to an approved device, such as modifications to the manufacturing process, equipment or facility, quality control procedures, sterilization, packaging, expiration date, labeling, device specifications, ingredients, materials or design.
+Added: PMA supplements often require submission of the same type of information as an initial PMA application, except that the supplement is limited to information needed to support any changes from the device covered by the approved PMA application and may or may not require extensive technical or clinical data or the convening of an advisory committee, depending on the nature of the proposed change.
+Added: In approving a PMA application, as a condition of approval, the FDA may also require some form of post-approval study or post-market surveillance, whereby the applicant conducts a follow-up study or follows certain patient groups for a number of years and makes periodic reports to the FDA on the clinical status of those patients when necessary to protect the public health or to provide additional or longer term safety and effectiveness data for the device.
+Added: The FDA may also require post-market surveillance for certain devices cleared under a 510(k) notification, such as implants or life-supporting or life-sustaining devices.
+Added: The FDA may also approve a PMA application with other post-approval conditions intended to ensure the safety and effectiveness of the device, such as, among other things, restrictions on labeling, promotion, sale, distribution and use.
+Added: The Investigational Device Process
+Added: Clinical trials are almost always required to support a PMA and are sometimes required to support a 510(k) submission.
+Added: All clinical investigations of investigational devices to determine safety and effectiveness must be conducted in accordance with the FDA’s IDE regulations which govern investigational device labeling, prohibit promotion of the investigational device, and specify an array of recordkeeping, reporting and monitoring responsibilities of study sponsors and study investigators.
+Added: Some types of studies deemed to present a “non-significant risk” are deemed to have an approved IDE once certain requirements are addressed and Institutional Review Board, or IRB approval is obtained.
+Added: If the device presents a “significant risk” to human health, as defined by the FDA, the sponsor must submit an IDE application to the FDA and obtain IDE approval prior to commencing the human clinical trials.
+Added: The IDE will automatically become effective 30 days after receipt by the FDA unless the FDA notifies the company that the investigation may not begin.
+Added: If the FDA determines that there are deficiencies or other concerns with an IDE for which it requires modification, the FDA may permit a clinical trial to proceed under a conditional approval.
+Added: The IDE application must be supported by appropriate data, such as animal and laboratory testing results, showing that it is safe to test the device in humans and that the testing protocol is scientifically sound.
+Added: Generally, clinical trials for a significant risk device may begin once the IDE application is approved by the FDA and the study protocol and informed consent are approved by an appropriate IRB.
+Added: There can be no assurance that submission of an IDE will result in the ability to commence clinical trials, and although the FDA’s approval of an IDE allows clinical testing to go forward for a specified number of subjects, it does not bind the FDA to accept the results of the trial as sufficient to prove the product’s safety and efficacy, even if the trial meets its intended success criteria.
+Added: During a study, the sponsor is required to comply with the applicable FDA requirements, including, for example, trial monitoring, selecting clinical investigators and providing them with the investigational plan, ensuring IRB review, adverse event reporting, record keeping and prohibitions on the promotion of investigational devices or on making safety or effectiveness claims for them.
+Added: The clinical investigators in the clinical study are also subject to FDA good clinical practice regulations and must obtain patient informed consent, rigorously follow the investigational plan and study protocol, control the disposition of the investigational device, and comply with all reporting and recordkeeping requirements.
+Added: Additionally, after a trial begins, we, the FDA or the IRB could suspend or terminate a clinical trial at any time for various reasons, including a belief that the risks to study subjects outweigh the anticipated benefits.
+Added: The results of clinical testing may be unfavorable, or, even if the intended safety and efficacy success criteria are achieved, may not be considered sufficient for the FDA to grant marketing approval or clearance of a product.
Pervasive and Continuing FDA Regulation
1 unchanged sentence
These include:
−Removed: the FDA’s Quality Systems Regulations (“QSR”), which requires manufacturers, including third party manufacturers, to follow stringent design, testing, production, control, supplier/contractor selection, complaint handling, documentation and other quality assurance procedures during all aspects of the manufacturing process;
+Added: ● the FDA’s Quality Systems Regulations (“QSR”), which requires manufacturers, including third party manufacturers, to follow stringent design, testing, production, control, supplier/contractor selection, complaint handling, documentation and other quality assurance procedures during all aspects of the manufacturing process;
● labeling and marketing regulations which require that promotion is truthful, not misleading, fairly balanced and provide adequate directions for use and that all claims are substantiated;
−Removed: complying with new requirements for Unique Device Identifiers on devices and also requiring the submission of certain information about each device to the FDA’s Global Unique Device Identification Database;
+Added: ● complying with new requirements for Unique Device Identifiers on devices and also requiring the submission of certain information about each device to the FDA’s Global Unique Device Identification Database;
● advertising and promotion requirements, including FDA prohibitions against the promotion of products for uncleared, unapproved or off-label uses and FDA guidance on off-label dissemination of information and responding to unsolicited requests for information;
14 unchanged sentences
● operating restrictions, partial suspension or total shutdown of production;
−Removed: the FDA’s refusal of requests for 510(k) clearance or premarket approval of new products, new intended uses or modifications to existing products;
−Removed: the FDA’s refusal to issue certificates to foreign governments needed to export products for sale in other countries;
+Added: ● the FDA’s refusal of requests for 510(k) clearance or premarket approval of new products, new intended uses or modifications to existing products;
+Added: ● the FDA’s refusal to issue certificates to foreign governments needed to export products for sale in other countries;
● withdrawing 510(k) clearance or premarket approvals that have already been granted;
1 unchanged sentence
Regulatory System for Medical Devices in Europe
−Removed: The European Union (“EU”) and the European Economic Area (“EEA”) (which is comprised of the 27 Member States of the EU plus Norway, Liechtenstein and Iceland and, until 2021, the United Kingdom) has a coordinated system for the authorization of medical devices.
−Removed: The European Union Medical Devices Directive (“MDD”) sets out the basic regulatory framework for medical devices in the EU.
+Added: The European Union (“EU”) and the European Economic Area (“EEA”) (which is comprised of the 27 Member States of the EU plus Norway, Liechtenstein and Iceland and, until 2021, the United Kingdom) has a coordinated system for the authorization of medical devices.
+Added: The European Union Medical Devices Directive (“MDD”) sets out the basic regulatory framework for medical devices in the EU.
This directive has been separately enacted in more detail in the national legislation of the individual member states of the EU.
The system of regulating medical devices operates by way of a certification for each medical device.
−Removed: Each certificated device is marked with a CE mark which shows that the device has a Certificat de Conformité, also referred to as a Certificate of Conformance.
+Added: Each certificated device is marked with a CE mark which shows that the device has a Certificat de Conformité, also referred to as a Certificate of Conformance.
There are national bodies known as Competent Authorities in each member state which oversee the implementation of the MDD within their jurisdiction.
4 unchanged sentences
Except for low-risk medical devices (Class I non-sterile, non-measuring devices), where the manufacturer can self-certify compliance with the MDD based on a self-assessment of the conformity of its products with the essential requirements of the EU Medical Devices Directive, a conformity assessment procedure requires the intervention of an organization accredited by a member state of the EEA to conduct conformity assessments, or a Notified Body.
−Removed: If a Notified Body of one member state has issued a Certificat de Conformité, the device can be sold throughout the EU without further conformance tests being required in other member states.
+Added: If a Notified Body of one member state has issued a Certificat de Conformité, the device can be sold throughout the EU without further conformance tests being required in other member states.
On April 5, 2017, the European Parliament passed the Medical Devices Regulation (Regulation 2017/745), which repeals and replaces the MDD and the Active Implantable Medical Devices Directive.
−Removed: The Medical Devices Regulation will become applicable in May 2020.
−Removed: Once applicable, the new regulations will among other things:
+Added: The Medical Devices Regulation will be fully implemented in May 2021.
+Added: The new regulations will among other things:
● strengthen the rules on placing devices on the market and reinforce surveillance once they are available;
−Removed: establish explicit provisions on manufacturers’
−Removed: responsibilities for the follow-up of the quality, performance and safety of devices placed on the market;
+Added: ● establish explicit provisions on manufacturers’ responsibilities for the follow-up of the quality, performance and safety of devices placed on the market;
● improve the traceability of medical devices throughout the supply chain to the end-user or patient through a unique identification number;
4 unchanged sentences
federal and state laws and regulations related to the privacy and security of personal information, including health information.
−Removed: Among others, the federal Health Insurance Portability and Accountability Act of 1996, as amended by the Health Information Technology for Economic and Clinical Health Act and their implementing regulations (collectively referred to as “HIPAA”) establish privacy and security standards that limit the use and disclosure of protected health information, or PHI, and require covered entities and business associates to implement administrative, physical, and technical safeguards to ensure the confidentiality, integrity and availability of individually identifiable health information in electronic form, among other requirements.
+Added: Among others, the federal Health Insurance Portability and Accountability Act of 1996, as amended by the Health Information Technology for Economic and Clinical Health Act and their implementing regulations (collectively referred to as “HIPAA”) establish privacy and security standards that limit the use and disclosure of protected health information, or PHI, and require covered entities and business associates to implement administrative, physical, and technical safeguards to ensure the confidentiality, integrity and availability of individually identifiable health information in electronic form, among other requirements.
Violations of HIPAA may result in civil and criminal penalties.
−Removed: Companies subject to HIPAA must also comply with HIPAA’s breach notification rule which requires notification of affected patients and the U.S.
−Removed: Department of Health and Human Services (“HHS”) and in certain cases of media outlets, in the case of a breach of unsecured PHI.
+Added: Companies subject to HIPAA must also comply with HIPAA’s breach notification rule which requires notification of affected patients and the U.S.
+Added: Department of Health and Human Services (“HHS”) and in certain cases of media outlets, in the case of a breach of unsecured PHI.
The regulations also require business associates of covered entities to notify the covered entity of breaches by the business associate.
3 unchanged sentences
These laws may be similar to or even more protective than HIPAA and other federal privacy laws.
−Removed: For example, California enacted the California Consumer Privacy Act (“CCPA”) which creates individual privacy rights for California consumers and increases the privacy and security obligations of entities handling certain personal data.
+Added: For example, California enacted the California Consumer Privacy Act (“CCPA”) which creates individual privacy rights for California consumers and increases the privacy and security obligations of entities handling certain personal data.
The CCPA went into effect on January 1, 2020, and the California Attorney General may bring enforcement actions for violations beginning July 1, 2020.
2 unchanged sentences
EU member states, the United Kingdom, Switzerland and other jurisdictions have also adopted data protection laws and regulations, which impose significant compliance obligations.
−Removed: In the EEA and the United Kingdom, the collection and use of personal data, including clinical trial data, is governed by the provisions of the General Data Protection Regulation (“GDPR”).
+Added: In the EEA and the United Kingdom, the collection and use of personal data, including clinical trial data, is governed by the provisions of the General Data Protection Regulation (“GDPR”).
The GDPR became effective on May 25, 2018, repealing its predecessor directive and increasing responsibility and liability of pharmaceutical and medical device companies in relation to the processing of personal data of EU data subjects.
5 unchanged sentences
The federal Anti-Kickback Statute prohibits persons from (among other things) knowingly and willfully soliciting, offering, receiving or providing remuneration, directly or indirectly, in exchange for or to induce the referral of an individual, or the recommending, furnishing or arranging for a good or service, for which payment may be made under a federal healthcare program such as Medicare or Medicaid.
−Removed: Courts have interpreted the Anti-Kickback Statute quite broadly, holding that the statute will be violated if even one purpose of a payment —
−Removed: though not its sole or primary purpose —
−Removed: is to induce an act prohibited by the statute with a willful intent to act improperly.
+Added: Courts have interpreted the Anti-Kickback Statute quite broadly, holding that the statute will be violated if even one purpose of a payment — though not its sole or primary purpose — is to induce an act prohibited by the statute with a willful intent to act improperly.
The statute prohibits many arrangements and practices that are otherwise lawful in businesses outside of the healthcare industry.
1 unchanged sentence
Prosecutors may infer intent from the surrounding circumstances and, because courts have interpreted the statute to be violated if even one purpose of a payment is to induce the purchase of items or services paid for by federal healthcare programs, prosecutors have broad discretion in choosing arrangements to prosecute under the statute.
−Removed: There are statutory exceptions and regulatory “safe harbors”
−Removed: available to protect certain appropriately structured arrangements that otherwise would implicate the Anti-Kickback
+Added: There are statutory exceptions and regulatory “safe harbors” available to protect certain appropriately structured arrangements that otherwise would implicate the Anti-Kickback
Statute and those who structure their business arrangements to satisfy all of the criteria of a safe harbor are protected from liability under the statute.
5 unchanged sentences
The federal False Claims Act imposes liability on any individual or entity that, among other things, knowingly presents, or causes to be presented, a false or fraudulent claim for payment by a federal healthcare program.
−Removed: The qui tam or “whistleblower”
−Removed: provisions of the False Claims Act allow a private individual to bring actions on behalf of the federal government alleging that the defendant has violated the False Claims Act and to share in any monetary recovery.
+Added: The qui tam or “whistleblower” provisions of the False Claims Act allow a private individual to bring actions on behalf of the federal government alleging that the defendant has violated the False Claims Act and to share in any monetary recovery.
In recent years, the number of lawsuits brought against healthcare industry participants by private individuals has increased dramatically.
4 unchanged sentences
The scope of these laws and the interpretations of them vary from state to state and are enforced by state courts and regulatory authorities, each with broad discretion.
−Removed: A determination of liability under such laws could result in fines and penalties and restrictions on a company’s ability to operate in these jurisdictions.
+Added: A determination of liability under such laws could result in fines and penalties and restrictions on a company’s ability to operate in these jurisdictions.
Transparency Laws
−Removed: The federal Physician Payment Sunshine Act (“Sunshine Act”) which was enacted as part of the Patient Protection and Affordable Care Act (“PPACA”) generally requires certain manufacturers of a drug, device, biologic or other medical supply that is covered by Medicare, Medicaid or the Children’s Health Insurance Program and applicable GPOs to report on an annual basis:
+Added: The federal Physician Payment Sunshine Act (“Sunshine Act”) which was enacted as part of the Patient Protection and Affordable Care Act (“PPACA”) generally requires certain manufacturers of a drug, device, biologic or other medical supply that is covered by Medicare, Medicaid or the Children’s Health Insurance Program and applicable GPOs to report on an annual basis:
(i) certain payments and other transfers of value given to certain healthcare professionals and teaching hospitals and (ii) any ownership or investment interest that certain healthcare professionals, or their immediate family members, have in their company.
6 unchanged sentences
For example, several states have enacted legislation requiring manufacturers to, among other things, establish and implement commercial compliance programs, file periodic reports with the state, make periodic public disclosures on sales, marketing, pricing, clinical trials and other activities and/or register their sales representatives.
−Removed: Certain state laws also regulate manufacturers’
−Removed: use of physician and patient identifiable data.
+Added: Certain state laws also regulate manufacturers’ use of physician and patient identifiable data.
These laws may affect our sales, marketing and other promotional activities by imposing administrative and compliance burdens.
6 unchanged sentences
Foreign Corrupt Practices Act
−Removed: The Foreign Corrupt Practices Act (“FCPA”) prohibits U.S.
+Added: The Foreign Corrupt Practices Act (“FCPA”) prohibits U.S.
businesses and their representatives from offering to pay, paying, promising to pay or authorizing the payment of money or anything of value to a foreign official in order to influence any act or decision of the foreign official in his or her official capacity or to secure any other improper advantage in order to obtain or retain business.
9 unchanged sentences
Healthcare Reform
−Removed: Changes in healthcare policy could increase our costs and subject us to additional regulatory requirements that may interrupt commercialization of our products.
−Removed: By way of example, the PPACA substantially changed the way healthcare is financed by both governmental and private insurers, and significantly impacted the medical device industry.
−Removed: Since its enactment, there have been judicial and Congressional challenges to certain aspects of the PPACA, and we expect there will be additional challenges and amendments to the PPACA in the future.
−Removed: On March 2, 2020, the United States Supreme Court announced that it would hear House of Representatives v.
−Removed: Texas , a case in which certain states have challenged the constitutionality of the PPACA’s individual mandate and whether, if the individual mandate is unconstitutional, if the individual mandate is severable from the remainder of the PPACA.
−Removed: If the Supreme Court rules that the individual mandate is unconstitutional and unable to be severed from the remainder of the PPACA, the remaining provisions of the PPACA would be invalid.
−Removed: It is unclear how this case, along with other efforts to repeal and replace the PPACA will impact the PPACA and our business.
−Removed: There will continue to be proposals by legislators at both the federal and state levels, regulators and third-party payors to reduce costs while expanding individual healthcare benefits.
−Removed: Certain of these changes could impose additional limitations on the prices we will be able to charge and/or patients’
−Removed: willingness to pay for our products.
−Removed: While in general it is too early to predict what effect, if any, any future healthcare reform legislation or policies will have on our business,
−Removed: current and future healthcare reform legislation and policies could have a material adverse effect on our business and financial condition.
+Added: The United States and many foreign jurisdictions have enacted or proposed legislative and regulatory changes affecting the healthcare system.
+Added: The United States government, state legislatures and foreign governments also have shown significant interest in implementing cost-containment programs to limit the growth of government-paid healthcare costs, including price controls and restrictions on reimbursement.
+Added: In the United States, the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Affordability Reconciliation Act, or collectively the Affordable Care Act, substantially changed the way healthcare is financed by both governmental and private insurers, and significantly impacts the healthcare industry.
+Added: The Affordable Care Act is intended to broaden access to health insurance, reduce or constrain the growth of healthcare spending, enhance remedies against healthcare fraud and abuse, add new transparency requirements for healthcare and health insurance industries, impose new taxes and fees on pharmaceutical and medical device manufacturers, and impose additional health policy reforms.
+Added: There have been significant ongoing efforts to modify or eliminate the Affordable Care Act.
+Added: On January 20, 2017, President Trump signed an executive order directing federal agencies to exercise existing authorities to reduce burdens associated with the Affordable Care Act pending further action by Congress.
+Added: In October 2017, he signed an Executive Order which directed federal agencies to modify how the Affordable Care Act is implemented.
+Added: The Tax Act, enacted on December 22, 2017, repealed the shared responsibility payment for individuals
+Added: who fail to maintain minimum essential coverage under section 5000A of the Internal Revenue Code of 1986, as amended, or the Code, commonly referred to as the individual mandate.
+Added: Further legislative and regulatory changes under the Affordable Care Act remain possible, although the new Presidential administration has signaled that it plans to build on the Affordable Care Act and expand the number of people who are eligible for subsidies under it.
+Added: President Biden indicated that he intends to use executive orders to undo changes to the Affordable Care Act made by the Trump administration and would advocate for legislation to build on the Affordable Care Act.
+Added: It is unknown what form any such changes or any law would take, and how or whether it may affect our business in the future.
+Added: The Affordable Care Act has been subject to challenges in the courts.
+Added: On December 14, 2018, a Texas U.S.
+Added: District Court Judge ruled that the Affordable Care Act is unconstitutional in its entirety because the “individual mandate” was repealed by Congress.
+Added: On December 18, 2019, the Fifth Circuit U.S.
+Added: Court of Appeals held that the individual mandate is unconstitutional and remanded the case to the Texas District Court to reconsider its earlier invalidation of the entire Affordable Care Act.
+Added: An appeal was taken to the U.S.
+Added: Supreme Court which heard oral arguments in the case on November 10, 2020.
+Added: A ruling is expected in 2021.
+Added: At the state level, legislatures have increasingly passed legislation and implemented regulations designed to control healthcare costs, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing.
+Added: We expect that additional federal, state and foreign healthcare reform measures will be adopted in the future, any of which could limit the amounts that federal and state governments will pay for healthcare products and services, which could result in limited coverage and reimbursement and reduced demand for our products, once approved, or additional pricing pressures.
Pricing and Reimbursement
2 unchanged sentences
These third party payors are increasingly challenging the price and examining the cost-effectiveness of medical products and services.
−Removed: In addition, significant uncertainty exists as to the reimbursement status of newly approved healthcare products, and efforts are underway by the current U.S.
−Removed: administration and states to reduce the cost of medical products and services overall.
+Added: In addition, significant uncertainty exists as to the reimbursement status of newly approved healthcare products, and there are continuing legislative and regulatory efforts by the federal government and the states to reduce the cost of medical products and services overall.
We may need to conduct expensive studies in order to demonstrate the cost-effectiveness of our products.
1 unchanged sentence
Decisions regarding the extent of coverage and amount of reimbursement to be provided are made on a plan-by-plan basis.
−Removed: One third-party payor’s decision to cover a particular product or procedure using the product does not ensure that other payors will also provide coverage for the product.
+Added: One third-party payor’s decision to cover a particular product or procedure using the product does not ensure that other payors will also provide coverage for the product.
Adequate third party reimbursement may not be available to enable us to maintain price levels sufficient to realize an appropriate revenue levels.
10 unchanged sentences
The information contained in, or that can be accessed through, our website is not part of this Annual Report.
+Added: Human Capital Resources
As of December 31, 2020, we had 108 employees worldwide.
1 unchanged sentence
We believe we have good relationships with our employees.
+Added: The success of our business is fundamentally connected to the well-being of our employees.
+Added: Accordingly, we are committed to their health, safety and wellness.
+Added: We provide our employees and their families with access to a variety of flexible and convenient health and wellness programs, including benefits that provide protection and security so they can have peace of mind concerning events that may require time away from work or that impact their financial well-being;
+Added: that support their physical and mental health by providing tools and resources to help them improve or maintain their health status and encourage engagement in healthy behaviors;
+Added: and that offer choice where possible so they can customize their benefits to meet their needs and the needs of their families.
+Added: In response to the COVID-19 pandemic, we implemented significant changes that we determined were in the best interest of our employees, as well as the communities in which we operate, and which comply with government regulations.
+Added: This includes having employees work from home, while implementing additional safety measures for employees continuing critical on-site work.
+Added: We strive to provide a competitive mix of pay, benefits and services that help meet the needs of our employees.
+Added: In addition to salaries, these programs include variable incentive compensation plans, potential annual discretionary bonuses, stock awards, a 401(k) Plan, healthcare and insurance benefits, health savings and flexible spending accounts, paid time off, family leave, and flexible work schedules, among others.
+Added: In addition to our broad-based equity award programs, we have used targeted equity-based grants with vesting conditions to facilitate retention of personnel.
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.