Artimplant Falls at U.S. Hurdle

Problems have been mounting for Swedish company Artimplant ever since U.S. patients started proceedings against it for problems they were experiencing with the Artelon CMC spacer, an absorbable thumb-joint reconstruction scaffold.

Now it seems they’ve hit the buffers with the announcement that they have applied for bankruptcy and had their application granted by a court in Gothenburg.

So what went wrong?

Artimplant has been sued by approximately 50 patients in the USA, who claim they have been injured by the CMC Spacer. Problems were first reported in 2009 and attributed by the company to physicians not following instructions. These were followed by two negative articles in the peer-reviewed Journal of Hand Surgery.

Behind the scenes, in recent months the company has been undertaking its own arbitration in Sweden to determine which insurance company or insurance broker is responsible for each claim related to the litigations in the USA.

It’s not difficult to imagine the negative impact these ongoing disputes have had on Artimplant’s sales and the brake it must have applied to the company’s plans.

Add to that a chronic need for money for a company that hadn’t yet reached profitability: According to its press release the company has been trying to find a new main shareholder, attract new capital to the company and to find new improved distribution channels.

The cold question will ultimately be, what happens to the intellectual property, which must by now be pretty substantial, given that the company has been in existence since 1997 and developed a broad product range on its poly(urethane-urea) absorbables platform.

Whether the 50 U.S. complainants have a case is yet to be tested: The problem might simply be that the chemistry doesn’t work in the applications for which it was intended, however compelling the idea was at the time. However, the significant number of implants performed over the years suggests the original company statement blaming technique may have some basis in truth.

It’s a shame, because the technology looked like it had promise in applications throughout the body. As is so often the case, this may unfortunately be yet another company finding out the hard way that pushing on into the ever-so-slightly litigious environment that is the United States, is not for the faint-hearted nor shallow of pocket. And when you have a unique new polymer it’s an even bigger ask.