St. Jude Medical Invests in Pain Therapy Device Developer

(NIH)

Medical device manufacturer St. Jude Medical in St. Paul, Minnesota is investing $40 million in pain therapy systems developer Spinal Modulation Inc. in Menlo Park, California. The equity investment deal, says St. Jude Medical, includes an option for the outright purchase of the privately-owned Spinal Modulation.

Under the agreement, St. Jude Medical becomes the exclusive distributor of Spinal Modulation’s lead product, the Axium Neurostimulator System. The system delivers a form of stimulation through low-level electrical signals to the dorsal root ganglion, a collection of neurons or nerve cells on the spine that carry signals from sensory organs to the brain.

The dorsal root ganglion has been identified as a promising target of treatments for chronic pain. Spinal Modulation says the system has shown results in managing chronic leg pain, as well as back and foot pain that can be difficult to treat. The Axium system, says the company, can be adjusted to treat broad or specific areas, often with less discomfort than other forms of spinal stimulation.

In the deal, St. Jude Medical will be the sole distributor of the Axium system, even in international markets where the device is now approved. The Axium system received in 2011 a CE mark, signifying clearance to market the device in Europe.

The agreement also give St. Jude Medical an option to purchase the entire Spinal Modulation company, following commercialization of the product in the U.S., for $300 million plus revenue-based milestones. Spinal Modulation received an  investigational device exemption from the Food and Drug Administration, which authorizes the conduct of clinical trials of the device in the U.S., which are expected to begin in the second half of 2013.

The American Academy of Pain Medicine says the number of people suffering from acute or chronic pain numbers in the millions. The organization cites data from the Institute of Medicine that chronic pain costs the U.S.  $560 to $635 billion annually, an amount equal to about $2,000 for every U.S. resident.

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