Every Day is an Opportunity to Make an Impact
An Interview of Accelus CEO Kevin McGann by F. Javier Perez, CFA
With his recent appointment to CEO, Kevin McGann is tasked with driving momentum at Accelus, a rapidly growing company in the expandable spinal implant space. We recently had the chance to speak with Kevin about what makes Accelus unique, the recent sale of the REMI robot to ATEC Spine, and his journey to the CEO seat.
Can you provide a quick intro of you and Accelus?
Kevin McGann: I was most recently named President & CEO of Accelus in April 2023. I joined Accelus, then Integrity Implants, in 2019 as Chief Commercial Officer and was promoted to President in 2021. I was attracted to the company because it was a smaller start-up with very innovative technology that allowed me to drive rapid growth.
Before joining Accelus, I had more than 30 years of experience in the medical device industry. I began my career in sales at U.S. Surgical before moving to Kyphon, another small start-up at the time, where I was able to play a key role in developing the Kyphoplasty procedure and helping the company grow from $20 million to over $400 million in revenue. In 2008, Kyphon was acquired by Medtronic for $4.2 billion, and I continued my journey at Medtronic Spine serving as the Vice President of Sales. I then joined Luminous, an Israeli-based medical laser company, which went from private to being publicly traded on Nasdaq and then back to private ownership. Then, I became the Vice President of Sales for Stryker Spine. However, my passion for working in a smaller start-up company, where I could once again experience the excitement of rapid growth and acceleration, brought me to where I’m sitting now at Accelus.
I guess you could say that it’s been an overnight success 30 years in the making?
Kevin McGann: Exactly. It’s been and continues to be a fun ride.
What led you into the medical device space in the first place?
Kevin McGann: It all started with my mother, who worked as a secretary for an orthopedic surgeon in New Brunswick, New Jersey. Growing up, I had always been intrigued by the medical field. Through a DePuy rep, I was fortunate to be introduced to the world of medical devices early in my career and joined a sales position at U.S. Surgical. Although it wasn’t specifically in Orthopedics or Spine, it was my gateway into the medical device industry. Since then, my focus has been predominantly on the commercial side, leading sales and marketing teams, and it’s been an incredibly rewarding career.
Could you share a little bit about how you made the jump into leadership and now as CEO of Accelus?
Kevin McGann: I’ve always viewed myself as a leader and have been fascinated by leadership and leaders themselves. U.S. Surgical was a small company when I joined. As we helped the company grow, they promoted from within, and taking on a leadership role was a natural fit for me. I really enjoyed the leadership aspect of my role and my ability to influence others’ lives.
I had a boss early on in my career, when I was managing seven individuals in seven different territories, ask me “How many people do you think you influence in a day?” And I said, “Well, seven.” And he said, “No, it’s actually closer to 28 because the average family has 2.3 kids and a spouse. Those 7 individuals will go home and talk about their day, and their experience affects their mood and the mood of their household.”
That conversation made my leadership role even more compelling, knowing the impact that I could have on so many people. And it’s multiplied even more in this industry as we influence patient outcomes. Every day is another opportunity to make a positive impact.
How has the transition to CEO been so far? I imagine it’s like drinking from a fire hose, but it seems you have been getting ready for this for some time.
Kevin McGann: It definitely has been a whirlwind. We acquired the Fusion Robotic technology, the Remi system, in July of 2021 and spent a lot of time helping develop that product from concept to commercialization. It’s an absolutely fabulous technology, but we also had a very successful implant business with FlareHawk. We took the company from just an implant company to an enabling technology and implant company pretty much overnight.
Candidly, it was a large undertaking for a relatively small company. When the markets changed, making it harder to raise capital, we found there was interest in Remi that led to discussions with Alphatec Holdings (ATEC). We ultimately decided to sell our Remi technology and assets to ATEC, finalizing the deal on April 19th, 2023.
As I talk with you now as CEO, we’re still in the first 100 days post the Remi sale. It’s been a very good move for Accelus. We’ve been able to shift the company’s focus to our highly differentiated implant systems, which we know will drive our growth and profitability.
Our implants are very unique. Our flagship product, FlareHawk, is a multidirectional expandable interbody cage that features our proprietary Adaptive Geometry™ technology, which is designed to respect a patient’s neural, vascular, bony, and soft tissue structures during insertion and then expand in a bilateral fashion to create a massive interbody footprint. This is unique in our niche of expandable implants, as most just expand in height while FlareHawk expands in both width and height. It’s been great to focus on that product line and drive international and domestic growth there.
What are some additional learnings from your experience developing Remi and ultimately selling the technology to ATEC?
Kevin McGann: Acquiring Remi allowed us to really dig into enabling technology and learn from the many surgeons currently interested in incorporating navigation, robotics, and augmented reality into their surgeries.
Brad Clayton, a long-time Medtronic enabling technology executive, and Dr. Kevin Foley had done a great job at developing a very relevant technology, and we were able to help get it ready for market and further expand its indications with 510(k) approvals for additional 3D imaging and 2D fluoro systems, which opens the market significantly.
However, in the current market environment, the technology will be better served by a larger company able to support it. ATEC realized that divesting Remi was a good move for Accelus and helped us shift our focus to the company’s core competencies and provided us with the capital that we could reinvest to continue to drive innovation and long-term business growth.
With you coming on as CEO and with the recent sale of the Remi robot, what does the future look like for Accelus?
Kevin McGann: The future at Accelus is incredibly bright. FlareHawk is a product that has a tremendous runway for growth both in the U.S. and internationally. Here in the U.S., we have many markets that we haven’t penetrated yet. That’s mostly due to being a small company, but our IP portfolio surrounding the FlareHawk technology and a sister technology that is branded Toro, is tremendous. Right now, we’re in the Alpha launch of our Toro lateral (Toro-L) interbody system, which is also an innovative multidirectional expandable implant.
Surgeons are experiencing good results with Toro-L, and we are excited to be able to expand our indications and applications to lateral spine surgery. From a growth perspective, we are primarily focused on FlareHawk in 2023 and driving that growth and profitability that will help bring our other IP portfolio technology to market.
In addition, for a small company, we have a tremendous amount of hospital approvals – more than 4,000 across the country. We’re on just about every major GPO contract and health system, which, again, speaks very well to technology. Plus, we’re doing business in 23 international countries, and we should be able to get to 25 by the end of the year. We are seeing significant growth in that marketplace with FlareHawk, giving us a pretty wide footprint (no pun intended) across the world. In addition, one of the key areas of focus for us is the growing of our presence in the minimally invasive space. Our implant plays incredibly well for those surgeons that are focused on MIS procedures, whether it’s percutaneous or endoscopic. We’re excited about the large runway before us at Accelus.
Let’s shift a bit. What do you see as the emerging trends in the industry, in your segment, but also broadly?
Kevin McGann: As I mentioned before, the integration of augmented reality, navigation, and robotics in spine is definitely a hot topic. While robotics is more prevalent in other orthopedic procedures, there is significant potential for growth in spine surgery and a major runway there. Some of the major current trends align perfectly with our technology, including the adoption of minimally invasive and endoscopic techniques, awake spinal fusions, and the shift towards 1-2 level degenerative fusions moving to ambulatory surgery centers (ASCs). We are excited to support our customers in those areas and grow alongside these trends.
Undoubtedly, spine is a very competitive industry with numerous spinal companies. Consolidation efforts are underway, and we expect the landscape to continue evolving. However, the advancements being made in these minimally invasive techniques and technology-driven surgical approaches will benefit the industry, and, most importantly, the patients we serve.
And what do you see as some of the main weaknesses or issues within the industry?
Kevin McGann: We constantly battle the reimbursement scenario as new techniques and approaches advance, making sure that they’re adopted by the insurance companies so that the surgeons are being reimbursed and reimbursed appropriately. Like any other industry, we also see continued pricing pressure and supply chain issues, but overall, the spine industry is incredibly healthy. Today’s active aging population and patient demographics match well for what we do for degenerative spine disease, which we expect to play out incredibly well for us.
The theme of The MedTech Digest is momentum and who is driving momentum in the industry. How do you drive momentum in both your organization and personally?
Kevin McGann: Momentum, to me, is that combination of cadence, speed, and discipline to continue moving forward. And so here at Accelus, it’s our major focus, continuing positive momentum and forward movement. Small wins pave the way for other small wins, which lead to much bigger wins. For Accelus and the tremendous amount of talent we have in our organization, one of my first actions as CEO was developing a clear vision and mission and setting ambitious goals for the company.
A lot of work has been done now internally to make sure that we’re all rowing and moving in that same direction, and with that in place, I’m seeing that the momentum just continues to accelerate. I’m very proud of the momentum we’ve been able to create in such a short time period and look forward to seeing where it takes us.
Who should we interview next?
Kevin McGann: We are fortunate to have a remarkable lineup of visionary surgeons in the field of spine – from Dr. Ernest Braxton in Vail and his significant contributions to awake spine surgery, Dr. Paul Houle in Cape Cod and Dr. Raymond Gardocki in Nashville, who are leaders in the endoscopic spine space, and Dr. Alex Vaccaro in Philadelphia for his work in outpatient and ASC spine surgery. I would recommend interviewing these esteemed thought leaders as they all possess invaluable insights and information that would greatly benefit your readers.
Just one more question for fun. So, do you whistle while you work?
Kevin McGann: ‘Whistle while you work’ is a value we’ve had for some time at Accelus, and yes, I do. I enjoy coming to work every day, what we’re doing and building, our company and employees, and our customers. And, of course, the benefit of what we do to influence positive outcomes for patients. I am grateful to be able to lead such an exciting company, and I enjoy what I do every day.
