For the next seven or eight months, we had no employees; it was just Mark and I. On Nov. 26, 2008, we received 510(k) clearance from the FDA. We then raised private money, about $4.5 million from friends and family. We hired our first employee in April 2009 and basically spent that year setting up manufacturing, quality systems, setting up the training programs for the surgeons, doing work around the diagnosis and finding the diagnostic algorithms to teach surgeons how to diagnose SI joint pain.
We have trained more than 700 surgeons to date. We did our very first surgery in June of 2009. We have grown as a company approximately 50 percent every single quarter, quarter over quarter, since June 2009.
Q: I also saw that you recently raised some venture funding.
A: We raised $16 million from Montreux Equity Partners and also Skyline Ventures. Our very first venture money came in last summer from Skyline, and then we had a bunch of private investors also participate who were friends of Mark’s and mine that have made money with us before.
Q: Talk a little bit about this type of surgery and the market SI-Bone is addressing.
A: There is $50 billion a year spent on lower back pain in the United States. Clinical studies show that 22 percent of that is related to the SI joint. The only surgery to treat the SI joint over the last number of decades is an open surgery where the patient endures a 12-inch incision. It is very bad for the patient, obviously. Ours is a minimally invasive surgery. It takes about an hour. So, we are treating something that almost has never been treated, but accounts for 22 percent of all lower back pain. As you probably know, the No. 1 reason that people visit their physician is for the flu. The second most important reason is back pain. So, it is a huge problem, and we are addressing an underserved, unmet need that afflicts millions of patients.
Q: How does the company stand out in the competitive landscape for minimally invasive surgery and surgery like yours?
A: Well, in the United States, there is only one very small company and one medium sized private company which have introduced products to compete with us. Let’s just say we have 95-plus percent market share. In Europe, there is one other competitor. We believe in our product. It is significantly better, easier to use for surgeons, better for the patient.
The key, though, is to educate the surgeons on how to diagnose this thing. We believe that everything is about patient selection because many people with lower back pain have an under-diagnoses. We spend a tremendous amount of money on educating surgeons, physician assistants, physical therapists, etc. about how to effectively diagnose these patients.
Q: Are you seeing patients that have gone through fusions or other surgeries come to you afterward? Are these new patients?
A: We have plenty of patients that are both de novo, who have been
diagnosed with sacroiliac joint issues or dysfunction, and previous spine fusion patients.
In the United States, there are hundreds of thousands of lumbar fusions each year. Literature shows that about 75 percent of all patients that have lumbar fusions develop adjacent segment disorder within five years. So, if you fuse a part of the lumbar spine, typically it affects other pieces of the orthopedic anatomy. The majority of people who have those kinds of surgeries within five years will have some kind of SI joint issues.
Q: You touched on this a little bit, but what does the reimbursement landscape look like for your device?
A: Our reimbursement rates are typically running about 94 percent. So, the reimbursement is actually quite reasonable. But, of course, as we get bigger as a company, the payers, i.e. the insurance companies and Medicare and the key medical societies including NASS, AAOS, CNS, AANS, ISAAS, ISIS and the AMA, are going to want to see efficacy, economic justification and safety data, so that is why we are investing so much in clinical studies. We are launching multiple studies.
Q: What else is good to know about SI-BONE?
A: What I am most proud of is we have hired 100 people in the last two years and we just have a tremendously talented group of people that are working together to help these patients. They are thriving as I am on the patients. What’s more fun than helping patients? Additionally, we have an advisory board made up of brilliant medical professionals like Dr. Steve Garfin, Dr. Frank Phillips, Dr. Paul Anderson and others. I would go out on a limb and say that our advisory board is among the most talented and respected spine advisory board in the United States.
So, we have a very good group of people that are trying to solve this problem and help educate people here and in Europe about how to help these patients.
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