Titan Spine, a Mequon, WI-based company that sells surgical implants designed for spinal surgeons to use when operating on patients, raised more than $7.8 million from investors across two separate funding rounds that closed in late December.
Titan’s products include a line of titanium “Endoskeleton” cages that are implanted to stabilize a patient’s spinal cord following the surgical removal of damaged vertebrae or the treatment of other conditions.
Co-founder and CEO Peter Ullrich says Titan plans to use some of the new money to fuel its continued growth. The company now has about 110 employees, says Ullrich, who estimates revenues from U.S. customers last year were about $62.2 million. That marked an increase of nearly 50 percent over Titan’s total U.S. sales in 2016, he says.
Southlake Equity Group, a private equity firm based in Southlake, TX, followed up its $7.5 million investment in Titan’s Series D funding round in 2016 with a second investment of the same amount late last year, Ullrich says.
Separately, on Dec. 29, Titan said it raised nearly $350,000 in equity funding from 10 investors, an SEC filing shows. That financing was part of the company’s Series B funding round, which now stands at more than $1.4 million.
According to company materials, some of the surgical implants Titan sells are made for procedures on patients afflicted with degenerative disc disease. A patient may elect to have surgery to remove a damaged disc, after which some of the remaining vertebrae in his neck or back may be fused together to protect the spinal cord.
Certain Titan-made implants feature a nanotextured surface technology that’s designed to mimic the coarse surface of bones. The surface throughout the cage is also rough on a micro- and nano-scale, making it rough to stem cells. Ullrich says the design is aimed at triggering the production of proteins associated with bone formation more effectively than other spinal fusion implants made from smooth titanium or a plastic material called PEEK (polyetheretherketone).
In mid-2016, Titan announced that the U.S. Centers for Medicare & Medicaid Services (CMS) had created new medical billing code for a “nanotextured surface on an interbody fusion device.” Ullrich said at the time that he and other leaders at Titan saw the code as something that could give the company a leg up against some of its larger and more established competitors whose implants are made with different materials. (Titan was incorporated in 2006 but is still relatively young and small compared to medical device heavyweights like Medtronic (NYSE: [[ticker:MDT]]) and Stryker (NYSE: [[ticker:SYK]])).
Over the past 18 months, surgeons have implanted more than 5,000 Titan devices featuring the nanotextured surface, which is known as nanoLOCK, Ullrich says. In a given month, about 300 surgeons use a Titan implant for at least one of their patients during an operation, he says.
Ullrich says in addition to signing up new healthcare providers that Titan has not done business with previously, the company is also working to get more existing customers to start using Endoskeleton implants with nanoLOCK surface technology.
“We have converted just under 40 percent of [customers] over to nanoLOCK,” he says.
The technology that underpins some of Titan’s newer spinal fusion cages could also later be used to develop other types of implants, such as medical screws and hip and knee implants, Ullrich says.
“This is a platform technology—the applications aren’t limited to cages,” Ullrich says. He emphasizes, however, that Titan’s intention is to “remain a spine company” and it has no plans to become a full-line orthopedic business.
According to Ullrich, having a CMS-created billing code for implants with nanotextured surfaces allows Titan and other organizations to examine data on patients’ health outcomes and healthcare costs. The company can now compare patients who have undergone procedures
