Integra LifeSciences Holdings Stock

Integra LifeSciences Holdings Corporation (Integra) operates as a global medical technology company innovating treatment pathways to advance patient outcomes and set new standards of surgical, neurologic and regenerative care.

The company has developed numerous product lines from this technology for applications ranging from burn and deep tissue wounds to the repair of dura mater in the brain, as well as nerves and tendons. The company has expanded its base regenerative technology business to include surgical instruments, neurosurgical products and advanced wound care through global acquisitions and product development to meet the evolving needs of the company’s customers and enhance patient care.

Integra products are sold in more than 130 countries through a direct sales force, as well as distributors and wholesalers. The company manufactures and sells medical technologies and products in two reportable business segments: Codman Specialty Surgical (‘CSS’) and Tissue Technologies (‘TT’).

The CSS segment consists of market-leading technologies and instrumentation used for a wide range of specialties, such as neurosurgery, neurocritical care, and otolaryngology. The company is the world leader in neurosurgery and one of the top three providers in instruments used in precision, specialty, and general surgical procedures.

The company’s TT segment focuses on three main areas: complex wound surgery, surgical reconstruction, and peripheral nerve repair.

The company has key manufacturing and research facilities located in California, Indiana, Maryland, Massachusetts, New Jersey, Ohio, Puerto Rico, Tennessee, Utah, France, Germany, Ireland, and Switzerland. The company sources most of its handheld surgical instruments and dural sealant products through specialized third-party vendors.

Strategy

The company’s strategies include innovating for outcomes; growing internationally; broadening impact on care pathways; and driving operations and customer excellence.

Business Segments

The company manufactures and sells its medical technologies and products in the following two reportable business segments: Codman Specialty Surgical and Tissue Technologies.

Codman Specialty Surgical

The company’s CSS segment offers global, neurosurgery market-leading technologies, brands and instrumentation. The product portfolio represents a continuum of care from pre-operative, to the neurosurgery operating room, to the neuro-critical care unit and post care for both adult and pediatric patients suffering from brain tumors, brain injury, cerebrospinal fluid pressure complications and other neurological conditions. The company offers leading technologies in dural repair, ultrasonic tissue ablation, intracranial pressure (‘ICP’) monitoring, hydrocephalus management, and cranial stabilization systems, while providing a rich research and development pipeline for growth.

Rounding out the portfolio is a catalog of surgical headlamps, surgical instrumentation, as well as after-market service. With thousands of surgical instrument products, including specialty surgical instruments, the company calls on the central sterile processing unit of hospitals and acute care surgical centers. Additionally, through a strong U.S. distribution model, the company can serve the needs of hundreds of medical offices.

The company’s global commercial network includes clinical specialists, a large direct global sales force and strategic partnerships and distributors that serve hospitals, integrated health networks, group purchasing organizations, clinicians, surgery centers and health care providers. Outside the U.S., the company has a combination of direct and indirect sales channels in international markets to sell certain product lines.

Tissue Technologies

The company’s TT segment focuses on three main areas: complex wound surgery, surgical reconstruction, and peripheral nerve repair and consists of five unique regenerative technology areas - highly engineered bovine collagen, bovine dermis, porcine urinary bladder, human amniotic tissue, and resorbable synthetic mesh. This broad regenerative platform, which includes multiple leading brands, such as Integra Dermal Matrices, AmnioExcel, SurgiMend, MicroMatrix and NeuraGen, primarily addresses the needs of plastic, reconstructive and general surgeons focused on the treatment of acute wounds, such as burns, chronic wounds, including diabetic foot ulcers, and surgical tissue repair, such as hernia, tendon, peripheral nerve repair and protection. Following the company’s acquisition of SIA in 2022, the company has also sought to expand the company’s IBBR product offerings and in June 2023 the company completed enrollment in the DuraSorb U.S. IDE clinical study for two-stage breast reconstruction.

The company has a specialized sales organization composed of directly employed sales representatives, as well as specialty distributors, organized based upon their call point. The company’s wound reconstruction sales representatives call on surgeons doing procedures in limb salvage, trauma, wound reconstruction and burns, and chronic wounds primarily in the inpatient wound care clinic setting. The company also has a dedicated surgical reconstruction sales team focused on plastic and reconstructive surgery and hernia procedures with differentiated products. Finally, the company has a distributor network focused on biologics. Outside the U.S., the company has a combination of direct and indirect sales channels in international markets to sell certain product lines.

This business segment also includes private-label sales of a broad set of the company’s regenerative and wound care technologies. The company’s customers are other medical technology companies that sell to end markets primarily in spine, surgical and wound care.

Competition

The company’s competitors for CSS include divisions within Medtronic, Inc., Stryker Corporation, Steris PLC, and B. Braun Medical, Inc.

The company’s competitors for TT include Smith & Nephew plc, Organogenesis Holdings Inc., MiMedx Group, Inc., Allergan PLC, Becton Dickinson and Company, and Axogen, Inc.

Research and Development Strategy

Regenerative Technologies

The company is a world leader in regenerative technology. The company’s regenerative technology development program applies the company’s expertise in bioengineering to a range of biomaterials, including natural materials, such as purified collagen, intact human or animal tissues, honey as well as resorbable synthetic polymers with the company’s DuraSorb and DuraSeal product lines. These unique product designs are used for neurosurgical and reconstructive surgical applications, as well as dermal regeneration, including the healing of chronic and acute wounds, tendon and nerve repair. The company’s regenerative technology platform includes the company’s legacy Integra Dermal Regeneration Template (‘IDRT’) products and complementary technologies that the company has acquired. The company’s collagen manufacturing capability, combined with the company’s history of innovation, including the company’s launch of NeuraGen 3D, provides the company with strong platform technologies for multiple indications.

In the second quarter of 2023, after consultation with the FDA, the company initiated a voluntary global recall of all products manufactured at the Boston facility, including Primatrix, Surgimend, Revize, and TissueMend, distributed between March 1, 2018 and May 22, 2023.

In the third quarter of 2021, the company filed a PMA application for a specific indication for Surgimend in the use of post-mastectomy breast reconstruction. In 2022, the company acquired SIA, which is also PMA for DuraSorb with IBBR, and in June 2023 the company completed enrollment in the DuraSorb U.S. IDE clinical study for two-stage breast reconstruction; the primary follow-up period is one year after device implantation. By offering two distinct product solutions, the company has the opportunity to build a leading position in the IBBR market. The company intends to obtain FDA approvals in 2025.

Additionally, in 2022 the company launched NeuraGen 3D Nerve Guide Matrix, a resorbable implant for repair of peripheral nerve discontinuities and engineered to create an optimized environment for nerve regeneration. Following the completion of design control activities in 2022, the company launched both Cytal and MicroMatrix in Europe in 2023. In 2023, the company received 510(k) clearance from the FDA for MicroMatrix Flex.

Electromechanical Technologies and Instrumentation

The CSS business consists of a broad portfolio of market-leading brands, such as Codman, DuraGen, DuraSeal, CUSA, Mayfield,Bactiseal, and Certas Plus, which are used for the management of multiple disease states, including brain tumors, traumatic brain injury, hydrocephalus and other neurological conditions. The growth in this business in recent years has been fueled by geographic expansion and new product registrations in markets, such as China, Japan, and Europe, which the company expect to continue in the near-to-long term. Because the company’s electromechanical products and instruments address significant needs in surgical procedures and limit uncertainty for surgeons, the company continues to invest in registrations, clearances, and approvals for new indications and next generation improvements to the company’s market-leading products. The company has several active programs focused on life cycle management and innovation for capital and disposable products in the company’s portfolio. The company’s product development efforts are focused on core clinical applications in cerebrospinal fluid (‘CSF’) management, neuro-critical care monitoring, minimally invasive instruments and electrosurgery and ultrasonic medical technologies, as well as the company’s ambition to transform the standard of care in neurosurgery with product advancements in minimally invasive surgery (‘MIS’) and the surgical management of intracerebral hemorrhage (‘ICH’). The company’s lighting franchise is among the most dynamic in the industry.

The company is focused on the development of core clinical applications in the company’s electromechanical technologies portfolio. The company continues to update its CUSA Clarity platform by incorporating new ultrasonic handpiece and integrated electrosurgical capabilities. In 2022, the company made progress to several enhancements to the company’s CUSA Clarity Tissue Ablation System. The extended laparoscopic tip was launched in the U.S. to enhance laparoscopic liver procedures. In addition, a single-sided bone tip received 510(k) clearance from the FDA. Commercial launch was completed successfully in early 2023. In August 2023, the company launched a modified 23 kHz CUSA Electrosurgery Module (CEM) for Clarity handpieces that can be used with additional electrosurgery generators. The company continues to work with several instrument partners to bring new surgical instrument platforms to the market.

Throughout 2023 the company also continued to advance the early-stage technology platforms the company acquired in 2019. Through the acquisition of Arkis Biosciences, Inc. (‘Arkis’) the company added a platform technology, CerebroFlo external ventricular drainage (‘EVD’), catheter with Endexo technology, a permanent additive designed to reduce the potential for catheter obstruction due to thrombus formation. The CerebroFlo EVD catheter has demonstrated an average of 99% less thrombus accumulation onto its surface, in vitro, compared to a market leading EVD catheter. The company’s work to combine the company’s Bactiseal antimicrobial technology with the Endexo anti-occlusive technology continues to progress for both a silicone-based hydrocephalus and EVD project.

Throughout 2023, the company continued to advance its innovation from the Rebound Therapeutics Corporation (‘Rebound Therapeutics’), which was acquired in 2019. Rebound Therapeutics specializes in a single-use medical device, known as the Aurora Surgiscope, which is the only tubular retractor system designed for cranial surgery with an integrated access channel, camera and lighting. The 9mm Surgiscope received 510(k) clearance from the FDA in the fourth quarter of 2023.

In the third quarter of 2021, the company launched its CereLink ICP Monitor System in the U.S. and Europe and continued the global rollout in the first half of 2022. On August 18, 2022, the company, after consultation with the FDA and other regulatory authorities outside of the United States, initiated an immediate voluntary global product removal of all CereLink intracranial pressure monitors. The out-of-range readings are principally caused by a combined interaction of electrical noise (originating from sources such as electrical components in the device, other devices set up near the CereLink Monitor, and the hospital power grid) and an electrical potential difference between the patient and monitor. The company submitted a traditional 510(k) submission to the FDA on September 15, 2023 as a result of customer reports about monitors whose pressure readings were out of range. The company has received 510(k) clearance from the FDA on February 4th, 2024. The company plans to resume shipments of CereLink monitors in the U.S. in the first quarter of 2024. Shipments resumed in international markets with a limited release in the third quarter of 2023.

Intellectual Property

AccuDrain, AmnioExcel, Aquasonic, Auragen, Aurora Surgiscope, Bactiseal, BioDFence, BioDOptix, Brainet, Budde, Buzz, CereLink, CerebroFlo EVD Catheter with Endexo Technology, Codman, Codman Accu-Flo, Codman Bicol, Codman Certas Plus, Codman HakimProgrammable valve, Codman Holter, Codman ICP Express, Codman Microsensor, Codman VersaTru, Codman VPV, Contour-Flex, Cranioplastic, CRW, CRW Precision, Ctherm, CUSA, Cytal, DirectLink, DuraGen, DuraSeal, DuraSorb, Gentrix, HeliCote, HeliPlug, HeliTape, HeliMend, Helistat, Helitene, Hermetic, Hy-Tape, Integra, IntegraLink, Isocool, Jarit, Lead-Lok, Licox, LimiTorr, Luxtec, Mayfield, MatriStem UBM, MediHoney, MicroFrance, MicroMatrix, Miltex, Mischler, MoniTorr ICP, Natus, NeuraGen, NeuraWrap, Nicolet, Omnigraft, Omni-Tract, OSV II, Padgett, PriMatrix, Pureflow, Q-Snor, Redmond, Revize, Ruggles, Signacreme, SurgiMend, TCC-EZ, TenoGlide, TissueMend, Ultra VS, VersaTru, Xtrasorb, zRIP, and the Integra logo are some of the material trademarks of Integra and its subsidiaries. MAYFIELD is a registered trademark of SM USA, Inc., and is used by Integra under license.

Seasonality

Revenues during the company’s fourth quarter (year ended December 2023) tend to be stronger than other quarters because many hospitals increase their purchases of the company’s products during the fourth quarter to coincide with the end of their budget cycles in the U.S. In general, the company’s first quarter usually has lower revenues than the preceding fourth quarter, the second and third quarters have higher revenues than the first quarter, and the fourth quarter revenues are the highest in the year. The main exceptions to this pattern occur because of material acquisitions.

Government Regulation and Compliance

The company is a manufacturer and marketer of medical devices and Human Tissue and Cell Based Products (‘HCT/Ps’) and therefore is subject to extensive regulation by the FDA, the Center for Medicare Services of the U.S. Department of Health and Human Services (‘HHS’), other federal governmental agencies, and in some jurisdictions, by state and foreign governmental authorities.

The company’s products are subject to extensive regulation particularly as to safety, efficacy and adherence to FDA Quality System Regulation, and related manufacturing standards. To perform clinical trials for significant risk devices in the U.S. on an unapproved product, the company is required to obtain an IDE from the FDA.

In Tennessee, the company is registered with the FDA Center for Biological Evaluations and Research.

Commercial sales of the company’s Class II medical devices (except for Class II exempt devices) and Class III medical devices within the U.S. must be preceded by either a pre-market notification filing pursuant to Section 510(k) of the FD&C Act (Class II) or the granting of a pre-market approval, or PMA (Class III).

The company is also required to register with the FDA as a medical device manufacturer and any devices the company manufactures and distributes pursuant to clearance or approval by the FDA are subject to pervasive and continuing regulation by the FDA and certain state agencies. These include product listing and establishment registration requirements, which help facilitate FDA inspections and other regulatory actions, and the company’s manufacturing sites are subject to periodic inspection by the FDA for compliance with the FDA's Quality System Regulations.

The majority of Integra manufacturing facilities participate in the Medical Device Single Audit Program and are audited annually for compliance with the Quality System for the U.S. FDA, Canada, Australia, Brazil, and Japan. A recognized Notified Body audits the company’s facilities annually to verify its compliance with the ISO 13485 Quality System standard.

The delivery of the company’s devices is subject to regulation by the U.S. Department of Health and Human Services and comparable state and non-U.S. agencies responsible for reimbursement and regulation of healthcare items and services.

Similar anti-bribery laws exist in many of the countries in which the company sells its products outside the U.S., as well as the United States Foreign Corrupt Practices Act (the ‘FCPA’) which addresses the activities of U.S. companies in foreign markets.

The company has compliance procedures in place for compliance with Employee Health & Safety laws, driven by a centrally led organizational structure that ensures proper implementation, which is essential to the company’s overall business objectives.

In the U.S. the company is obligated to comply with the requirements of the Health Insurance and Portability Act of 1996, as amended by the Health Information Technology for Economic and Clinical Health Act of 2009 (collectively, ‘HIPPA’).

In Europe, the company is subject to EU General Data Protection Regulation (‘GDPR’) which requires member states to impose minimum restrictions on the collection, use and transfer of personal data and includes, among other things, a requirement for prompt notice of data breaches to data subjects and supervisory authorities in certain circumstances and significant fines for non-compliance.

History

Integra LifeSciences Holdings Corporation was founded in 1989. The company was incorporated in Delaware in 1989.