Introduction • The Gift of Invention • The Lawsuit
Seventeen years ago, a spine surgeon called an engineer at Sofamor Danek (now Medtronic Spine and Biologics) and said he had just used their new Orion Cervical Plate. He said it was a nice device, but there were some problems with it. He asked if he could make some suggestions.
The engineer said, “No thanks.” He told the surgeon that if he thought he could do a better job, he should do it himself.
The Gift of Invention
Gary Michelson, M.D. did exactly that. Now, $1.35 billion dollars and 955 patents later, Michelson is on the Forbes magazine annual list of the 400 richest Americans. He was listed at No. 290 in 2010, with a net worth estimated at $1.4 billion.
In a 2005 interview with Orthopedics This Week, Michelson said he did not want to be a business man. “I wanted to practice medicine. I did not want to get rich from medical devices. That is not why I patented them. I wanted to insulate myself from the business side of things.”
Having had the gift of being able to take things apart and put them back together as a kid, inventing was not hard for Michelson. He said the only difficult part in inventing is identifying the problem. Solving it is much easier.
For instance, during one surgery he thought to himself, “I cannot leave this piece of bone behind, it’s too big…I never invented something in the abstract and then wondered what it will be useful for,” said Michelson.
That led him to develop a small set of instruments which were the right size and right shape for treating different spurs and osteophites. He eventually made a deal with Sofamor Danek to develop his patented devices.
However, in 2001 the company filed a lawsuit against him for allegedly attempting to license his inventions to competing spinal implant companies.
He countersued Medtronic and accused the firm of failing to aggressively develop his inventions and pay him royalties.
A jury awarded Michelson $510 million in punitive and compensatory damages. Eventually, in order to settle all claims, he agreed to accept $1.35 billion and sell the company a range of inventions and technologies
Michelson’s experience and settlement will be seen by some as a watershed moment in the relationship between spine surgeons and device companies. A new health care economic environment is pushing payers to demand that products be safer, more effective and cost effective than previous products.