Maayan Ventures Ltd. (TASE:MAYN) portfolio company Surgix Ltd. has raised $500,000 from current and external shareholders. Maayan Ventures, which owns 32% of Surgix, invested $118,000.

Surgix is developing a computer assisted system for real-time image guided surgery, mainly for orthopedic trauma. Its CEO is Oren Drori. The system improves the accuracy of procedures and reduces mistakes by the surgeon.

“This can be a great procedure for someone under the age of 50 who has pain after a significant meniscal injury or multiple previous meniscus surgeries and is too young and active for a knee replacement,” said Dr. Patrick McCulloch, an orthopedic surgeon with the Methodist Center for Sports Medicine in Houston.

“In some cases, the meniscus has been damaged so severely that it has to be removed. This surgery works for people who have no functioning meniscus and have limited damage to the cartilage surfaces of the joint.”

Such laws have been enacted in Massachusetts and Vermont, and a federal effort, the Physician Payment Sunshine Act, is pending a vote in the U.S. Senate as part of a health-care reform bill. The Advanced Medical Technology Association, which represents device makers, says it supports the legislation.

“Disclosure is key, but self-disclosure by physicians may not be so accurate,” said Mininder Kocher, a Harvard Medical School orthopedic surgeon who participated in the research.

In the study, researchers measured the accuracy of disclosures by orthopedic surgeons who presented research at the March 2008 annual meeting of the American Academy of Orthopaedic Surgeons, by comparing the doctors’ disclosures against a similar list published by five makers of hip and knee implants.

But an industry analyst Wednesday said the businesses stand to gain more than they would lose because the tax revenue would be used to cover uninsured Americans. That would create hundreds of thousands of new consumers for the industry, he said.

“This is a good deal; the industry will make money,” said Robin R. Young, CEO and co-founder of PearlDiver, a Fort Wayne firm that gathers and analyzes data on the life sciences industry. “This tax is going to be used to bring in more patients.”

But one of Warsaw’s orthopedic device makers disputes that analysis.

“I don’t think he could be more wrong,” Biomet Inc. spokesman Bill Kolter said.

Young gave the keynote address at the fourth annual Orthopedic Device and Technology Conference and Exposition, which concludes today at Grand Wayne Center.

The orthopedic device industry, centered heavily in Warsaw, has been up in arms since Sen. Max Baucus, D-Mont., proposed a $4 billion annual fee to help cover the cost of an overhaul aimed at insuring at least some of the millions of Americans without insurance.

Last month, device makers got the Indiana and Minnesota Senate delegations to send a letter asking Baucus to drop the orthopedic fee proposal altogether.

Young said device makers are missing an opportunity to find common ground with the government – creating new recipients for orthopedic devices.

Research indicates that patients who receive those devices are more ambulatory and healthier.

“I don’t understand why the companies are so opposed to this,” Young said in an interview.

Baucus, chairman of the Senate Finance Committee, also proposed $6 billion in annual fees on health insurers and $2.3 billion on pharmaceutical manufacturers.

The fees translate into a tax of roughly 2 percent on the affected industries, Young said.

Biomet disputes whether the proposed fees would amount to a 2 percent tax on the industry.

In his calculations, Young assumed the medical device industry generates $200 billion a year.

But Wanda Moebius, of the industry group AdvaMed, pointed to figures pegging revenue at $164 billion.

Young said he calculated his figures using companies’ SEC filings and that he’d been told by one orthopedic maker they were too conservative.

But the point, he said, is figuring out how many new patients device makers would need before they have more new revenue than the fees cost.

The device makers also dispute that covering the uninsured would mean hundreds of thousands of new customers.

“The majority of hip and knee replacement patients are Medicare patients, for example, so it’s difficult to imagine new patients coming from the uninsured in the numbers you related to me,” Zimmer Inc. spokesman Brad Bishop said in an e-mail.

“We anticipated this approval, and it is very good news that we can now begin to manufacture OrthADAPT and Unite products. We have already started to ship Synovis-labeled OWC products,” said Richard W. Kramp, Synovis Life Technologies president and chief executive officer. “As previously reported, we have hired 25 experienced employees covering production, regulatory and clinical affairs, quality, marketing and customer service. We have also started hiring eight direct sales representatives for our OWC products, and we expect to complete this hiring in the first quarter of fiscal 2010. We are also looking to contract with independent representatives to complete our coverage of the United States and to begin seeking qualified distributors for European Union countries.

“Many physicians are already familiar with OrthADAPT and Unite products, and we are pleased to again make these proven, clinically advantageous products available to them,” Kramp continued. “Our investment in OWC fits our long-term growth strategy of acquiring approved products that expand our presence in the growing soft tissue repair market. Synovis increased its available market potential by almost one billion dollars with this acquisition, thus almost doubling the size of the markets where we have approved products to sell.”

The acquisition improves the competitive position of Kimberly-Clark Health Care in the $2 billion global market for minimally invasive chronic spinal pain management. Financial terms of the transaction were not disclosed.

“The acquisition of Baylis Medical’s pain management business is consistent with our global business plan strategy to invest in the higher-growth, higher-margin medical device market,” said Joanne Bauer, president, Kimberly-Clark Health Care. “This transaction will enable us to accelerate the growth of our pain management business around the world while strengthening our commitment to patients suffering from chronic spinal pain. Together with Baylis Medical, we’re enhancing patients’ quality of life through minimally invasive, radio-frequency therapies.”

Baylis Medical President Frank Baylis said that today’s announcement is a logical move for both companies. “We are very excited about Kimberly-Clark’s acquisition of Baylis Medical’s pain management business. We’ve enjoyed an excellent and mutually beneficial working relationship over the last eight years and integrating our technology with Kimberly-Clark’s global resources makes for a unique and powerful offering in the pain management category,” he said.

Mr. Blair has over 30 years of experience in the healthcare field, including serving as the President of Richards Medical Company (Smith & Nephew) as well as the Non-executive Chairman of DJO, Inc., (formerly NYSE-listed sports medicine company). Jack currently serves as a Director of NuVasive, Inc. (NASDAQ:NUVA), as Non-executive Chairman of Active Implants Corporation, and as a Director of Buckman Laboratories, a chemical company based in Memphis, TN.

“By leveraging the shape memory characteristics in PEEK Altera™, MedShape will be able to generate new implant designs and techniques that were previously not possible. I am very excited to be part of this innovative organization,” concluded Blair.

Mr. Hills is currently President and Chief Investment Officer of Hills Capital Management, a Barrington, Illinois investment company which manages public and private investment funds and is the lead equity investor in MedShape Solutions, Inc. “Investment opportunities in platform technology companies like MedShape are rare and we are thrilled to be an integral part of it,” stated Hills.

MedShape Solutions, Inc. also announced today the appointment of Jim Lorenzo as Vice President of Sales and Rick Leach as the Senior Director of Marketing.
Mr. Lorenzo has over 20 years of sales and sales management experience in orthopedics with a majority of those years with DePuy Orthopedics, a Johnson & Johnson company. “Having someone of Jim’s caliber join our organization speaks volumes to the type of company we are building. Jim’s relationships and knowledge of introducing orthopedic devices will provide MedShape with a distinctive advantage in the marketplace,” stated Chris Fair, MedShape’s Chief Operating Officer.

Mr. Leach brings over 25 years of sales and marketing experience in orthopedics as well as a background in international markets. “Rick’s diverse experience in sales, marketing and international markets will be instrumental as we launch products both in the U.S. and abroad. We are honored to have him join us,” stated Fair.
MedShape Solutions recently introduced the Morphix™ Suture Anchor system in select markets across the U.S. The Morphix™ anchor is the only orthopedic device currently available that utilizes PEEK Altera™, a proprietary shape memory PEEK material.

Suspension Orthopaedic Solutions received the money from two wealthy investors in Maryland and New York, CEO Dr. Jeffrey Gelfand said in an interview.

He declined to name the investors.

The money comes as life sciences companies see an uptick in funding as investors have more confidence in the economy. In Maryland, Washington, D.C., and Virginia, venture capital firms invested $14 million in biotech companies, a 16 percent increase compared with last year.

Suspension Orthopaedic will bring its first two markets by mid-2010, said Gelfand, an orthopedic surgeon. A one-year-old company, Suspension Orthopaedic employs three.

As a result of the Order, on September 30, 2009, Cardo entered into an Asset Purchase Agreement (the “Agreement”) with Vertebron, as a debtor-in-possession, to purchase substantially all of Vertebron’s assets, excluding certain assets, such as accounts receivable, cash and cash equivalents as of the closing date. Pursuant to the Agreement, the purchase price for the assets is $1,300,000 to be paid in cash.

Cardo, as a successor in interest to Accelerated Innovation, LLC, is a party to a license agreement with Vertebron, dated October 19, 2007. Pursuant to the Agreement, Cardo assumed the license agreement from Vertebron.

The description of the Agreement is qualified in its entirety by reference to the copy of such agreement filed as Exhibit 2.1 to this report, which is incorporated herein by reference.