Amedica Ceases Distribution of Amniotic Derived Allograft Products

Salt Lake City, Utah-based Amedica Corporation, a biomaterial company focused on using its silicon nitride technology platform to develop, manufacture and sell a broad range of medical devices, has chosen to cease distribution of amniotic derived allograft products under a distribution agreement with a third party supplier.

According to company officials, the decision to cease distribution of these allograft products and terminate the agreement allows the company to direct resources to obtaining FDA 510(k) clearance on the company’s silicon nitride cancellous structured ceramic (CSC) biomaterial, a potential alternative to allograft bone with superior characteristics. This hydrophilic and osteoconductive bioceramic is designed to facilitate bone growth in the center lumen of an interbody spinal device, which should allow surgeons to reduce or eliminate the use of allograft bone and other osteoconductive biomaterials.

Amedica’s interbody devices utilizing CSC have received a CE mark and are currently being distributed in The Netherlands, Spain and Germany. The company is also conducting a prospective randomized clinical trial in Europe named CASCADE comparing its Valeo composite silicon nitride interbody devices, which combine an existing Amedica Valeo interbody product design with CSC, to PEEK (polyetheretherketone) interbody devices to obtain additional safety and efficacy data to support a 510(k) clearance in the United States. The trial is 100 percent enrolled with 100 patients, and results are expected to be published in the second half of 2014.

“Amedica’s silicon nitride interbody devices, with and without cancellous structured ceramic, offer significant advantages over other spinal implants,” said President and CEO Eric Olson. “With this in mind, the company is focused on driving the technology forward for rapid acceptance in the marketplace to the ultimate benefit of patients worldwide.”

“Revenue from the amniotic derived allograft products accounted for less than 4 percent of overall sales in Q1 of 2014, but was as high as 12 percent in 2013,” added Chief Financial Officer Jay Moyes. “However, gross margin from these products was negligible. While our decision to cease distribution of these allograft products under the distribution agreement may initially result in a decline in top-line revenue in the short-term, we believe it is in the best interest of our customers and shareholders that our company focuses on our proprietary biomaterials which yield much higher gross margins.”