LDR Medical – from Troyes to New York, A French success story

christophe-lavigneAmong the French medtechs that have been incredibly successful abroad, you will find LDR Medical. In just 10 years, this small Troyes-based company expanded internationally until it was bought out in 2016 by US company Zimmer for over $1 billion. One of its founders, Christophe Lavigne, divulges the secrets of his company’s dazzling success.

 

LDR Medical – “made-in-France” healthcare innovation

 

Messrs Lavigne, Dinville and Richard had been working together in the medical sector for 10 years when they decided to create LDR Medical. “We were in regular contact with surgeons and wanted to be able to develop devices that would considerably improve the quality of life of patients with severe spinal pathologies, such as cervical disc prostheses that would give patients the physiological mobility they didn’t have with existing devices.” They suggested to their managers that they should invest in the spinal column, but this market was not considered a priority. So all three colleagues left and became partners. It was the beginning of a brand-new adventure built from scratch – when the company was founded in 2000, it had €8,000 in capital. “We didn’t have much except for the most important ingredient: determination”, remembered Christophe.

 

Their audacity quickly convinced local investors, securing them financing for their R&D. The company set up in a technology hub in the Champagne region, where a network of local experts helped expedite the startup process, in particular creating the legal and financial structure. In 2001, after having created numerous work groups with French and international surgeons, the company filed its first patent. “Back then, the cost of filing that patent nearly put us in the red, but the risk/reward profile was too attractive to ignore!” Christophe recalled.

 

Over the next four years, following successful surgical implantations in France, the company had continued to develop, attracting other investors including the Rothschild family. In 2005, it started marketing its first artificial cervical discs. LDR Medical was now ready to take on the world.

 

Transparency and precision – the secrets to appealing to US investors

 

“Back in 2005, expanding into the US was already in our minds”, explained Christophe. And the reason is clear: Uncle Sam accounts for 65% of the global spine market. The cervical prostheses market totaled a potential $1.3 billion in the United States alone. “Three solutions were available to us: working with local distributors, teaming up with a licensed partner, or going it alone.” The three founders finally settled on the latter option. But to move forwards, they needed US investors. Christophe booked a flight to New York, armed with his “very basic” English and his sales pitch on revolutionary prostheses, in an attempt to win over investors on the other side of the pond. “In the United States, you are judged more on the quality of your ideas than your language skills. If your audience believes in you, money is not a problem. You just need to be able to clearly explain your innovation, be transparent about the risks and not hesitate to offer seats on your board.” Christophe’s entrepreneurial presentation found favor with a number of investors including Austin Ventures, which put more than $80 million on the table. This money would be used to finance the approval process for LDR Medical’s devices in the United States and develop the company’s business development worldwide. And while $80 million is a tidy sum, it would all be needed to secure the sacrosanct FDA approval.

 

 

One of the most stringent markets in the world

 

“Breaking into the US medical market is tough, as the approval process is one of the most demanding in the world”, explained Christophe. To gain access – bearing in mind that there was no equivalent of our flagship device in the US market – we had to undergo an IDE clinical study to prove both that our devices were risk-free and that they offered real benefits over existing solutions. And for highly technical devices, such as those LDR Medical makes, this test phase can be very long and costly. “We registered with the FDA in 2005, undertook the largest study ever carried out on the cervical spine and finally obtained approval eight years later in 2013!” Our device became the first cervical disc prosthesis approved in the United States for both one and two-level indications.” Once they had obtained IDE approval for medical devices, it set the ball rolling.” US approval and the associated Clinical One Evidence certification allowed us to sell in the United States, and what’s more, its global recognition acted as a passport to worldwide sales.” Furthermore, this approval was a convincing marketing argument that the Troyes-based company promoted to its customers as proof of its quality and professionalism.

 

And since then?

Since 2013, the company has continued to grow, making headlines in the economic press. Following the $80 million private equity investment, it was successfully listed on NASDAQ in 2013, raising more than $200 million, and was most recently bought out in 2016 by Zimmer-Biomet, the world leader in orthopedics, for over $1 billion. A success story that its founder, now heading a new consulting company, draws upon to advise other medtechs in making their American dream come true.

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