Former Medtronic executive gets top spot at Colorado spine firm

June 21, 2010 by MedCity News

Medtronic Inc.'s former chief operating officer Michael DeMane joins spinal surgery device company Lanx Inc. as chairman and CEO.

MedCity News logo

By Thomas Lee

Michael DeMane joined Lanx Inc. as chairman and CEO. The former chief operating officer at Medtronic Inc. (NYSE:MDT) was once thought to be a top candidate to lead the firm.

Lanx, based in Broomfield, Colorado, makes devices for spinal surgeries. Investors include Chicago Growth Partners, Goldman Sachs Private Equity Opportunities Fund, Noro-Moseley Partners and Oakwood Medical Investors.

"Lanx has established considerable momentum based on an impressive product portfolio and pipeline," DeMane said in a prepared statement. Founders "Michael Fulton, Jeffrey Thramann and their team have built a company with a responsive, solutions oriented culture, while maintaining a high level of ethics and integrity. We expect to continue our commitment to those values in our mission to build a world class spine company over the long term."

DeMane joined Medtronic in 1999 when the company bought spine firm Sofamor Danek. He served as president of Medtronic's spine division where "he was instrumental in building one of the largest global spine franchises and his tenure was marked by a period of substantial new product flow and rapid revenue growth," the Lanx release said.

DeMane's tenure was marked by controversy. In 2006, Medtronic paid $40 million to settle a federal investigation that accused the company of making improper payments to doctors who recommended Medtronic's spine products. The Justice Department accused Sofamor Danek of paying kickbacks to doctors through "sham consulting agreements, sham royalty agreements and lavish trips to desirable locations."

The episode prompted Sen. Chuck Grassley (R-Iowa) to examine possible conflict of interest relationships between doctors and medical device companies, scrutiny that continues today.