KneeAlign System Value Proposition System Value Proposition OrthAlign Confidential Information –...

OrthAlign Confidential Information – September 27, 2010 001015 Rev E

KneeAlign™ System Value Proposition

OrthAlign Confidential Information – September 27. 2010 001015 Rev E

At A Glance About The KneeAlign™ System [See Section A]

• Palm-sized surgical navigation system for tibial resection in Total Knee Arthroplasty (TKA). • Universal and suitable for all TKA systems. • Precision of large console computer-assisted surgery (CAS) with the simplicity of conventional instrumentation. • Disposable unit for one-time use: significantly lower in cost than large console CAS. • Determines the tibia’s mechanical axis by using easily identifiable anatomic landmarks. • Enables the surgeon to set the orientation of the tibial cutting block to the surgeon’s desired pre-operative goals in a

short, easy procedure. • 510(k) cleared by the U.S. Food and Drug Administration as being substantially equivalent to large console CAS

systems on the market. • Early clinical and cadaver studies support the KneeAlign system’s ability to enable on-target tibial implant alignment.

• Requires no capital expenditures and entails only a small learning curve (estimated to be about 3 cases based on

clinical feedback), enabling the hospital and its surgeons to evaluate the system with minimal investment and time commitment.

Clinical Need: Reducing Implant Malalignment [See Section B] The KneeAlign System Compared to Large Console Computer-Assisted TKA Surgery [See Section C]

KneeAlign System / Large Console CAS Feature Comparison Feature KneeAlign System Large Console CAS Implant Mechanical Axis Alignment Precise Precise Capital Expenditures None > $100,000 Amortized (3 year) per procedure cost < $1,000 (no amortization. needed) > $1,000 Learning Curve < 3 cases (estimated)1 Difficult TKA procedure time added Marginal (potential time reduction) Up to 30 min. added2 Hassle factor None Significant Back table work Several minutes, simple Lengthy, complex

The KneeAlign System Compared to Conventional Instrument TKA Surgery [See Section D]

• The KneeAlign is equivalent in tibial measurement accuracy to CAS, which provides more precise alignment than

conventional instrument TKA and which can lead to superior clinical outcomes.3

• The KneeAlign system has the potential to reduce TKA surgery times by using easily identifiable landmarks to precisely calculate the mechanical axis, reducing the surgeon’s need to estimate the tibia’s position in its soft tissue envelope.

• The KneeAlign system can increase hospital revenues by enabling the hospital to attract patients and surgeons as a

computer-assisted surgery technology center. The KneeAlign System Compared to Custom-Fit Cutting Blocks (Pre-Operative Navigation) [See Section E]

• The KneeAlign system continues to allow surgeons to exercise their intra-operative clinical judgment, which is constrained by custom-fit cutting blocks.

• The KneeAlign system is lower in price.

• The KneeAlign system entails fewer logistical hurdles and does not require a CT Scan, MRI or additional x-rays.

• The precision of CAS has better-documented clinical support than custom-fit cutting blocks, which have had some negative clinical reports. 4


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A. About The KneeAlign System The KneeAlignTM system is a palm-sized, disposable surgical navigation system for tibial resection in Total Knee Arthroplasty (TKA). The KneeAlign system enables the surgeon to quantitatively measure and set the orientation of the tibial cutting block to the tibia’s mechanical axis intra-operatively in a short, easy procedure. The KneeAlign system combines the precision of large console computer-assisted surgery (CAS) with the simplicity of conventional mechanical instrumentation and is the only orthopedic device, other than large console CAS, which allows the surgeon to measure and set both the posterior slope and varus/valgus orientation of the tibial cutting block intra-operatively. The KneeAlign system utilizes familiar instrumentation and is universal and suitable for all TKA systems. The KneeAlign navigation unit is used in combination with a KneeAlign tibial jig. This user-friendly tibial cutting jig is similar to existing conventional instrumentation; however, when integrated with the KneeAlign unit, it registers the desired anatomic landmarks. Using the KneeAlign tibial jig and the disposable KneeAlign unit, the surgeon can quickly and easily establish the tibia’s mechanical axis. The surgeon can then quickly set the desired varus/valgus angle and posterior slope angle - a measurement that no system other than large console CAS is able to provide- and lock the tibial cutting block in position. Multiple TKA cases have been performed by surgeons from the Insall Scott Kelly Institute using the KneeAlign system, with successful alignment results achieved in the twenty cases performed as of the date of this report.5 Prior to reaching the clinic, the KneeAlign system was the culmination of an intensive 15-month product development effort aided by the efforts of a dozen of the top TKA surgeons in the U.S. As part of this rigorous, iterative process, the KneeAlign system was fine-tuned in multiple cadaveric studies to enable precise tibial alignment in a procedure designed to meet the high demands of an orthopedic surgeon’s workflow. The KneeAlign system has received 510(k) clearance from the FDA as being substantially equivalent to large console CAS systems for tibial measurements. Since the KneeAlign system requires no capital expenditures and entails only a small learning curve (estimated to be about 3 cases based on clinical feedback), the hospital and its surgeons can evaluate the system first-hand with minimal investment and time commitment.

KneeAlign Surgical Navigation Unit


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B. Clinical Need: Reducing Implant Malalignment

At a Glance

Malalignment Literature Findings

• 31.8% of TKAs performed using conventional instrumentation resulted in implant malalignment. 6

• 9% of TKAs performed using large console computer-assisted surgery (CAS) resulted in implant malalignment. 7

• Implant malalignment accounted for approximately 16% of total knee revisions.8

• > 3° of tibial component varus alignment increased the odds of implant failure by roughly 17x.9

• The combination of tibial malalignment and obesity resulted in relative revision risk of 168.10


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B. Clinical Need: Reducing Implant Malalignment The prevailing consensus in TKA is that tibia-femoral alignment should be within 3° of the leg’s neutral mechanical axis11, a clinical outcome that is usually within the surgeon’s complete control. Despite this clinical standard, implant malalignment (frequently defined as a deviation of > ±3° from the mechanical axis) is a major cause of TKA implant failure, accounting for approximately 16% of total knee revisions.12 A recent analysis of twenty-nine clinical studies comparing CAS to conventional instrumentation TKA found that 31.8% of TKAs performed with conventional instrumentation resulted in implant malalignment, compared to 9% of TKAs performed with CAS.13 Given that 97% of TKAs performed in the U.S. today are performed using conventional mechanical instrumentation,14 this 31.8% malalignment rate for conventional TKA is a cause for concern. Since TKA clinical studies tend to be performed by high-volume TKA-specialist surgeons, the malalignment rate may actually be even higher when taking into account TKAs performed by general orthopedic surgeons, who perform about 80% of all TKAs.15 Tibial component malalignment has been specifically associated with adverse clinical events. In a study of 2,125 patients (3,152 knees) undergoing TKA between the years of 1983– 2000, it was found that tibial malalignment was a strong predictor of the need for revision, with more than 3° of tibial component varus alignment increasing the odds of implant failure by roughly 17x (Hazard Ratio = 17.2, p < 0.0001).16 This same study found that the combination of tibial malalignment and obesity indicated an especially strong risk for revision, with a relative risk of approximately 168 (p < 0.0001), suggesting that a well-aligned tibial component could significantly reduce revision rate among obese patients. 17 Given that approximately 87% of Canadian TKA patients are obese or overweight18 (with the U.S. likely sharing similar statistics), achieving accurate tibial component alignment is particularly important. Moreover, relatively little clinical research has been done regarding posterior-slope alignment (an angle which the KneeAlign system enables the surgeon to measure and set), with available data suggesting that the prevalence of malalignment in this dimension may even be worse than varus/valgus malalignment.19


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C. The KneeAlign System Compared to Large Console Computer-Assisted TKA Surgery

At a Glance

KneeAlign System / Large Console CAS Feature Comparison Feature KneeAlign System Large Console CAS Implant Mechanical Axis Alignment Precise Precise Capital Expenditures None > $100,000 Amortized (3 year) per procedure cost < $1,000 (no amortization. needed) > $1,000

Learning Curve < 3 cases (estimated)20 Difficult TKA procedure time added Marginal (potential time reduction) Up to 30 min. added21

Hassle factor None Significant

Back table work Several minutes, simple Lengthy, complex


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C. The KneeAlign System Compared to Large Console Computer-Assisted TKA Surgery

1. The KneeAlign System is Significantly Less Expensive than Large Console CAS and Provides Comparable

Precise Alignment

As stated in Section A, the KneeAlign system has received 510(k) clearance as being substantially equivalent for tibial measurements to large console CAS systems on the market, and its clinical and cadaver experience to date has demonstrated success in enabling the surgeon to achieve precise tibial alignment.

Large console CAS, however, is significantly more expensive than the KneeAlign system. Figure 1 describes the payments that hospitals may be required to make for large console CAS. As illustrated in Figure 2, for a hospital able to utilize a CAS console for 100 TKA cases per year,26 this would result in a cost per case for large console CAS of approximately $2700, amortizing costs over 1 year of cases, and approximately $1400 per case, amortizing costs over 3 years of cases.

Figure 2: Hypothetical Amortized Cost Per Case for Large Console CAS

Years of Large Console CAS System Usage Annual Proced. Vol. 1 2 3 4 5 50 $4,800 $2,900 $2,267 $1,950 $1,760 100 $2,700 $1,750 $1,433 $1,275 $1,180 200 $1,650 $1,175 $1,017 $938 $890

This does not take into account the financial burden to the hospital of upfront cash commitments for the initial purchase of CAS capital equipment and software and annually for services. Nor does it take into account the additional expenditures that a hospital would likely be required to make for the replacement of CAS hardware (assuming a lifetime of 5 years or less)27 and for software upgrades. In addition, a CAS system is typically specific to a given implant system or requires additional software (with associated costs) for use with more than one implant system, making it difficult (if not impossible) for a single CAS system to accommodate all of a hospital’s knee surgeons. Finally, despite being on the market for over 10 years and the intensive surgeon training efforts made by the large orthopedic CAS companies during this time, large console CAS is rarely used in TKA surgery,28 suggesting that there is a high risk that a hospital’s investment in CAS would go under-utilized. On the other hand, the KneeAlign system is compatible with all TKA implant systems, and entails no capital expenditures, software or servicing costs- the only payment the hospital is required to make is the per procedure cost for the disposable KneeAlign unit, which is under $1,000. In addition to being almost always lower than the amortized, per procedure cost of large console CAS, the KneeAlign system allows the hospital to provide its surgeons with computer navigation without having to make upfront capital expenditures, and with relatively little investment at stake if surgeons decide to discontinue use of the device or to leave the hospital.

Figure 1: Hypothetical Payment Structure for Large Console CAS Hardware capital expenditures $100,000 - $200,00022 Software capital expenditures $40,00023 Servicing $20,000 per year24 Disposables $200-$900 per TKA procedure25


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2. The KneeAlign System is Significantly Easier to Use than Large Console CAS Based on clinical and cadaver experience to date with multiple orthopedic surgeons, the learning curve for the KneeAlign system is estimated to be approximately 3 cases, as opposed to the learning curve for most CAS systems, which can be much longer. Since OR staff for many surgeons changes frequently, and most TKAs are performed by surgeons that average fewer than 4 TKAs per month, the learning curve for CAS may continue indefinitely for many surgeons.29 In addition, large console CAS has been found to increase operating times by up to 30 minutes per case compared to conventional instrumentation.30 On the other hand, the KneeAlign system, as will be described in Sections D2 and D3, may reduce operating times for many surgeons compared to conventional instrumentation, and is expected to be time-neutral for TKA specialists that typically use conventional instrumentation. Large console CAS systems also entail a significant “hassle” factor, arising from their time-consuming set-up and non-intuitive interfaces. This hassle factor includes CAS’s requirement that the surgeon look outside of the operative field for computer feedback, the vulnerability of their complex optical systems to operating room interference (e.g. people or surgical material blocking equipment line of sight) and the occurrences of system shutdowns and delays (e.g. caused by the system booting up or crashing due to over-heating).31 The KneeAlign system, in contrast, requires only a quick, simple set-up, utilizes instruments similar to those the surgeon is familiar with, has its user interface within the operative field and requires no optical systems. 3. The KneeAlign System Can Increase Hospital Revenue and Reduce Costs by Reducing TKA Surgery Times

Compared To Large Console CAS As will be described in Sections D2 and D3, KneeAlign is time neutral compared to conventional instrument TKA surgery and may even allow surgeons to reduce their TKA procedure times. Given that large console CAS can increase operating times by up to 30 minutes per case compared to conventional instrumentation, 32 if a hospital is able to achieve moderate time-savings in additional areas, it could perform another 2 TKA procedures in a given OR per day compared to CAS. If the hospital is reimbursed $12,257 for a TKA procedure33 and that OR is utilized 240 days per year, this would represent additional gross income to the hospital of almost $6 million. A hospital able to utilize 3 ORs in this fashion would be able to increase its gross revenue by about $18 million annually.

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Figure 3: Potential Annual Hospital Gross Revenue Increases from OR Time Savings Compared to Large

Console CAS!


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The timing-savings described in this section for the KneeAlign system compared to large console CAS does not take into account the additional OR time that CAS requires to be set-up before the procedure and disassembled after the procedure is complete. In contrast to many CAS systems, which frequently require multiple trays for instrumentation, the KneeAlign system only requires one instrumentation tray for the KneeAlign tibial jig (as described in Section A), which replaces the tibial jig the surgeon would otherwise have used and requires only a few minutes of back table assembly, which occurs concurrently with back table set-up for the operation. 4. The KneeAlign System Can Reduce Hospital Costs by Reducing Hospital Staff Requirements Compared To

Large Console CAS

The minimal set-up and disassembly times required for the KneeAlign system compared to large console CAS and the fact that all of the KneeAlign instrumentation requires only one tray, as compared to the multiple trays required for CAS instrumentation, means that fewer hospital personnel resources would be required to manage the KneeAlign system, which can decrease the hospital’s internal costs. For example, the KneeAlign system would require less time and personnel for OR set-up, management and disassembly than CAS, and for instrument transport, sterilization and processing. In addition, since the KneeAlign system back-table assembly is short and relatively simple, OR scrub technician training would be far easier than with CAS, allowing the hospital to dedicate less time to training and to train new personnel quickly. Further, unlike, large console CAS, the simplicity of the KneeAlign system would not require a company technician in the OR to assist the staff in navigating system complexities or errors.


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D. The KneeAlign System Compared to Conventional Instrumentation TKA Surgery

At a Glance

• The KneeAlign system is equivalent in tibial measurement accuracy to large console CAS, which

provides more precise alignment than conventional instrument TKA and which can lead to superior clinical outcomes.34 [See Section D1]

• The KneeAlign system has the potential to reduce TKA surgery times by using easily identifiable landmarks to precisely calculate the mechanical axis, reducing the surgeon’s need to estimate the tibia’s position in its soft tissue envelope. [See Section D2]

• The KneeAlign system can increase hospital revenues by enabling the hospital to attract patients and surgeons as a computer-assisted surgery technology center. [See Section D3]


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D. The KneeAlign System Compared to Conventional Instrumentation TKA Surgery

1. The KneeAlign System is Equivalent in Tibial Measurement Accuracy to Large Console CAS, Which Provides More Precise Alignment Than Conventional Instrument TKA and Which Can Lead to Superior Clinical Outcomes

As described above, the KneeAlign system has received 510(k) clearance from the FDA as being substantially equivalent in tibial measurement accuracy to large console CAS systems, which have been shown to be significantly superior to conventional instrumentation in reducing implant malalignment and have been shown to lead to improved clinical results.35

2. The KneeAlign System Has the Potential to Reduce TKA Surgery Times and Increase Their Predictability

by Removing Time-Consuming Steps in Preparing the Tibial Cut

Based on clinical and cadaveric experience to date and consultations with orthopedic surgeons, the KneeAlign system is expected to have about a 3 case learning curve and reduce the time that many orthopedic surgeons spend making the tibial cut by removing the following potentially time-consuming steps that many surgeons currently must perform using conventional instrumentation:

• Lining up the tibial jig with the mechanical axis of the tibia by attempting to estimate by eye the exact location of the tibia, which is often unclear, especially in obese patients, in which alignment is crucial.

• Holding the tibial jig on the tibia and keeping it oriented with the tibia’s mechanical axis, while attempting to pin the jig onto the tibia in its soft tissue envelope, which is often time consuming.

• Confirming that the tibial jig is oriented with the tibia’s mechanical axis, while confronting issues of

parallax when viewing the position of the jig relative to the tibia from different angles. The KneeAlign system reduces and simplifies these steps, which a recent clinical study has found to be among the most time-consuming elements in a TKA procedure. 36 Once the KneeAlign tibial jig is pinned to the tibia, the surgeon can use the KneeAlign to calculate the mechanical axis using easily identifiable anatomic landmarks. The surgeon is then able to set the desired varus/valgus and posterior slope angles and to lock the cutting block into position. The cutting block is then pushed to the anterior tibia, with resection depth set and the cutting block pinned in position in the usual manner.

This technique may result in time-savings for many orthopedic surgeons, and is expected to be time-neutral for high-volume TKA-specialist surgeons that typically use conventional instrumentation. A surgical time-savings for many surgeons could lead a reduction in patient tourniquet, anesthesia and immobilization times, increased time of which has been associated with one or more of: deep vein thrombosis,37 blood-loss, anesthesia side effects, infection and knee revision.38 Assuming that a hospital is normally able to perform 5 TKA procedures in a single OR per day with conventional TKA instrumentation, a time-saving of 15 minutes per procedure would allow a 75 minute time-savings for that OR per day. Depending on the hospital’s current OR turn-over efficiency and if it is able to achieve moderate time-savings in additional areas, it could perform another TKA procedure in that OR per day. If the hospital is reimbursed $12,257 for a TKA procedure39 and that OR is utilized 240 days per year, this would represent additional gross revenue to the hospital of almost $3 million per OR year. A hospital able to utilize 3 ORs in this fashion would be able to increase its gross revenue by about $9 million annually.


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By reducing its surgical procedure time, a hospital could also reduce its costs. For example, certain direct costs frequently tied to surgical procedure time length, such as the cost of anesthesia drugs and staff time and overtime, could be reduced if surgical time is reduced. Further, infection risk and therefore the risk of the hospital incurring additional costs arising from infection treatment and increased hospital stay could also be lowered by reducing surgical time.40 In addition, if complexity is removed from the tibial cut a hospital can better estimate TKA surgery time in surgery schedule planning, reducing uncertainty about OR and staff availability and potentially allowing the hospital to book more surgeries. 3. The KneeAlign System Can Increase Hospital Revenues by Enabling the Hospital to Attract Patients and

Surgeons as a Computer-Assisted Surgery Technology Center The KneeAlign system can help a hospital increase its revenues by attracting more patients as a result of its substantial equivalence to large console CAS in tibial measurement precision. Similarly, the hospital may be able to attract more surgeons to its facilities by offering a cutting-edge computer navigation product, which would also lead to an increase in the hospital’s patient volumes and revenues. The hospital’s orthopedic surgeons can also use the KneeAlign system and the outcomes that they obtain with it to market their practices and increase their patient base through, for example, community lectures and referral discussions with internists. In addition, the KneeAlign system can help hospitals compete in a far more capital-efficient manner with other hospitals that have purchased capital-intensive large console CAS systems (as described in Section C above). For example, the availability of CAS for orthopedic procedures is one of the positive weighting criteria used by the US News & World Report in ranking hospitals, with a hospital employing such a system eligible for a 1 point increase in its specialty index score (calculated out of 100 points).41

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Figure 4: Potential Annual Hospital Gross Revenue Increases from OR Time Savings Compared to

Conventional Instrumentation!


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E. The KneeAlign System Compared to Custom-Fit Cutting Blocks (Pre-Operative

Navigation)

At a Glance

• The KneeAlign system continues to allow surgeons to exercise their intra-operative clinical judgment, which is constrained by custom-fit cutting blocks. [See Section E1]

• The KneeAlign system is lower in price. [See Section E2]

• The KneeAlign system entails fewer logistical hurdles and does not require a CT Scan, MRI or

additional x-rays. [See Section E2]

• The accuracy of intra-operative navigation has better-documented clinical support than custom-fit cutting blocks, which have had some negative clinical reports. [See Section E2]


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E. The KneeAlign System Compared to Custom-Fit Cutting Blocks (Pre-Operative

Navigation) 1. The KneeAlign System Continues to Allow Surgeons to Exercise Their Intra-Operative Clinical Judgment,

which is Constrained by Custom-Fit Cutting Blocks The KneeAlign system enhances the surgeon’s performance by providing precise quantitative feedback on the orientation of the tibial cutting block while allowing the surgeon the freedom to exercise his or her own clinical judgment during the procedure. Custom-fit cutting blocks, on the other hand, are designed by the cutting block company’s computer software and engineers and do not allow the surgeon the freedom to navigate intra-operatively. If the surgeon disagrees with the design of the cutting block during the course of the procedure - for example, the surgeon may discover something not identified pre-operatively - the custom-fit cutting block does not allow the surgeon the flexibility to address this discovery and the surgeon must instead discard the block and continue the procedure with conventional instrumentation. 2. Other Benefits of the KneeAlign System Over Custom-Fit Cutting Blocks

• Lower Price: A custom-fit cutting block is typically between $1,000 and $2,000 (not including the additional cost of the CT Scan or MRI to create the block) while the KneeAlign system is under $1,000.

• Fewer Logistical Hurdles: In general, in order to have custom-fit cutting blocks available for surgery, the hospital must send a CT scan or MRI of the patient to the cutting block manufacturer several weeks in advance of the procedure, and the surgeon must correspond with the cutting block manufacturer over the design of the cutting block. Once the surgeon has approved the cutting block design, approximately two weeks are required for the cutting blocks to be made. The KneeAlign system does not require any of this type of advance coordination.

• No CT Scan or MRI: A CT Scan or MRI of the patient’s knee is required to be taken for the custom-fit

cutting block to be made. Insurers are increasingly refusing to pay for this $1,000-$2,000 imaging cost, requiring the hospital to cover any costs of the scan itself. Moreover, public concerns over radiation over-exposure, including significant radiation errors that have recently been publicized, have made patients and health care providers alike less receptive to any unnecessary exposure of patients to radiation.42

• The Precision of CAS Has Better-Documented Clinical Support than Custom-Fit Cutting Blocks, which

Have Had Some Negative Clinical Reports: As described in Sections A and B, the KneeAlign system has shown equivalent tibial measurement accuracy to large console CAS systems already on the market, which have been shown by multiple clinical studies to reduce the incidence of implant malalignment. Introduced around 2006, custom-fit cutting blocks are a relatively new TKA technology, sometimes described as pre-operative navigation. There is scarce clinical literature supporting the precision of custom-fit cutting blocks, and there have been clinical reports indicating that they can recommend component malalignment and that they place implants at high risk of early failure.43


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References 1 Estimate based on feedback from OrthAlign’s orthopedic advisors and on early cadaveric and clinic experience. 2 Chin PL, Yang KY, Yeo SJ et al. (2005). Randomized Control Trial Comparing Radiographic Total Knee Arthroplasty Implant Placement Using Computer

Navigation Versus Conventional Technique. The Journal of Arthroplasty, 20(5): 618-26. “Computer-Assisted Navigation for Total Knee Arthroplasty,” Blue Cross / Blue Shield Assessment Program, Volume 22, No. 10, Nov. 2007.

3 Mason J, Fehring T, et al (2007). Meta-Analysis of Alignment Outcomes in Computer-Assisted Total Knee Arthroplasty Surgery. The Journal of Arthroplasty 1097:1106. Berend ME, Ritter MA, Meding JB et al. (2004). Tibial Component Failure Mechanisms in Total Knee Arthroplasty. Clinical Orthopaedics and Related Research 428:26-34.

4 Klatt, B.A., et al. (2008). Custom-Fit Total Knee Arthroplasty (OtisKnee) Results in Malalignment. The Journal of Arthroplasty 23:26-29. 5 A report of the cases performed in November and December 2009 is available from OrthAlign upon request. 6 Mason J, Fehring T, et al (2007). Meta-Analysis of Alignment Outcomes in Computer-Assisted Total Knee Arthroplasty Surgery. The Journal of Arthroplasty 1097:1106.

7 Mason J, Fehring T, et al (2007). Meta-Analysis of Alignment Outcomes in Computer-Assisted Total Knee Arthroplasty Surgery. The Journal of Arthroplasty 1097:1106.

8 Mulhall K, Ghomrawi H, et al (2006). Current Etiologies and Modes of Failure in Total Knee Arthroplasty Revision. Clinical Orthopaedics and Related Research;45:50. Sharkey P, Hozack W, et al (2002). Why Are Total Knee Arthroplasties Failing Today? Clinical Orthopaedics and Related Research 7:13.

9 Berend ME, Ritter MA, Meding JB et al. (2004). Tibial Component Failure Mechanisms in Total Knee Arthroplasty. Clinical Orthopaedics and Related Research 428:26-34.


11 Decking, R., et al (2005). Leg Axis After Computer-Navigated Total Knee Arthroplasty, A Prospective Randomized Trial Comparing Computer-Navigated and Manual Implantation. The Journal of Arthroplasty 20:282-288. R.A. Denham, R.E.D. Bishop (1978). Mechanics of the Knee and Problems in Reconstructive Surgery. The Journal of Bone and Joint Surgery (American) Vol. 60-B, No. 3, pp. 345-352. Stulberg, S.D. (2003). How Accurate is Current TKR Instrumentation? Clinical Orthopaedics and Related Research. Number 416, pp. 177-184.

12 Mulhall K, Ghomrawi H, et al (2006). Current Etiologies and Modes of Failure in Total Knee Arthroplasty Revision. Clinical Orthopaedics and Related Research;45:50. Sharkey P, Hozack W, et al (2002). Why Are Total Knee Arthroplasties Failing Today? Clinical Orthopaedics and Related Research 7:13.

13 Mason J, Fehring T, et al (2007). Meta-Analysis of Alignment Outcomes in Computer-Assisted Total Knee Arthroplasty Surgery. The Journal of Arthroplasty 1097:1106.

14 http://www.aaos.org/news/bulletin/sep07/reimbursement3.asp. 15 J. Katz et al (2004), Association Between Hospital and Surgeon Procedure Volume and the Outcomes of Total Knee Replacement. The Journal of Bone and Joint Surgery (American) 86:1909-1916 [Approximately 80% of TKAs are performed by surgeons with an annual volume of less than 50 procedures per year.]


17 The Blue Cross / Blue Shield Technology Evaluation Committee has found the design of the Berend, et al. study and several other published studies too limited

to support malalignment as a definitive cause of implant revision. However, the Committee has acknowledged the strong link between malalignment and revision shown by these studies. “Computer-Assisted Navigation for Total Knee Arthroplasty,” Blue Cross / Blue Shield Assessment Program, Volume 22, No. 10, Nov. 2007.

18 Bourne, R., et al. (2007). Role of Obesity on the Risk for Total Hip or Knee Arthroplasty. Clinical Orthopaedics and Related Research 465(4): 188. 19 Jenny, J.Y, et al. (2001). Computer-Assisted Implantation of Total Knee Prostheses: A Case-Control Comparative Study with Classical Instrumentation.

Computer Aided Surgery 6:217-220. 20 Estimate based on feedback from OrthAlign’s orthopedic advisors and on early cadaveric and clinic experience. 21 Chin PL, Yang KY, Yeo SJ et al. (2005). Randomized Control Trial Comparing Radiographic Total Knee Arthroplasty Implant Placement Using Computer


22 http://www.aaos.org/news/bulletin/janfeb07/clinical9.asp. Slover et al (2008). Impact of Hospital Volume on the Economic Value of Computer Navigation for

Total Knee Replacement. The Journal of Bone Joint Surgery (American) 90:1492-1500.


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23 Slover et al (2008). Impact of Hospital Volume on the Economic Value of Computer Navigation for Total Knee Replacement. The Journal of Bone Joint

Surgery (American) 90:1492-1500. 24 Slover et al (2008). Impact of Hospital Volume on the Economic Value of Computer Navigation for Total Knee Replacement. The Journal of Bone Joint

Surgery (American) 90:1492-1500. 25 http://www.aaos.org/news/bulletin/janfeb07/clinical9.asp. 26 J. Katz et al (2004). Association Between Hospital and Surgeon Procedure Volume and the Outcomes of Total Knee Replacement. The Journal of Bone Joint

Surgery (American). 86:1909-1916. [80% of all TKAs in the US are performed at hospitals that perform less than 200 TKA cases annually.] 27 Slover et al (2008). Impact of Hospital Volume on the Economic Value of Computer Navigation for Total Knee Replacement. The Journal of Bone Joint

Surgery (American);90:1492-1500. 28 http://www.aaos.org/news/bulletin/sep07/reimbursement3.asp. [It is estimated that approximately 2% of US orthopedic surgeons currently use CAS systems

and that they may account for 3% of all total knees implanted.] Based on OrthAlign’s discussions with its orthopedic surgeon advisors. 29 J. Katz et al (2004). Association Between Hospital and Surgeon Procedure Volume and the Outcomes of Total Knee Replacement. The Journal of Bone Joint

Surgery (American) 86:1909-1916. 30 Chin PL, Yang KY, Yeo SJ et al. (2005). Randomized Control Trial Comparing Radiographic Total Knee Arthroplasty Implant Placement Using Computer


31 Based on OrthAlign’s discussions with its orthopedic surgeon advisors. 32 Chin PL, Yang KY, Yeo SJ et al. (2005). Randomized Control Trial Comparing Radiographic Total Knee Arthroplasty Implant Placement Using Computer


33 Range of Medicare Payments for Top Five Elective Inpatient Hospital Procedures, FY2006. StateHealthFacts.org. [Average Medicare reimbursement for TKA

in 2006 was approximately $12,257 for primary and $16,228 for revision procedures.] 34 Mason J, Fehring T, et al (2007). Meta-Analysis of Alignment Outcomes in Computer-Assisted Total Knee Arthroplasty Surgery. The Journal of Arthroplasty 1097:1106. Berend ME, Ritter MA, Meding JB et al. (2004). Tibial Component Failure Mechanisms in Total Knee Arthroplasty. Clinical Orthopaedics and Related Research 428:26-34.

35 Mason J, Fehring T, et al (2007). Meta-Analysis of Alignment Outcomes in Computer-Assisted Total Knee Arthroplasty Surgery. The Journal of Arthroplasty 1097:1106. Berend ME, Ritter MA, Meding JB et al. (2004). Tibial Component Failure Mechanisms in Total Knee Arthroplasty. Clinical Orthopaedics and Related Research 428:26-34.

36 Dushey, Craig, Pelker, Richard. Time Allocation in Total Knee Arthroplasty: Time Allocation Differs Between Longer and Shorter Cases. [Pending

publication] 37 Epps, C, et. al (1987). General Principles in the Prevention of Surgical Complications in Orthopedic Surgery. Clinical Orthopaedics & Related Research.

222:5-20. [Pathogenesis of deep vein thrombosis has been associated with patient age, length of surgical procedure, degree and length of time of immobilization and obesity.]

38 AAOS- 2009 Annual Meeting Podium Presentations, Adult Reconstruction Knee 2: Outcomes of Primary TKR 2, Correlation of Procedure Time and Surgeon

Volume with Primary Knee Outcomes: A Medicare Study, Podium No: 252, Thursday, February 26, 2009, 09:24 AM - 09:30 AM, Ong, Laug, Mont et al., Location: Venetian Hotel, Palazzo P. [Revision risk was significantly associated with procedure duration (p=0.001). Primary knee procedures lasting more than 240 minutes were significantly associated with higher revision rates (adjusted odds ratio: 1.34; p=0.012) compared to 120-150 minutes. Procedures shorter than 120 min. (p=0.008) and between 150-180 min. (p=0.004) also had significantly higher revision rates compared to those lasting 120-150 min.]

39 Range of Medicare Payments for Top Five Elective Inpatient Hospital Procedures, FY2006. StateHealthFacts.org. [Average Medicare reimbursement for TKA

in 2006 was approximately $12,257 for primary and $16,228 for revision procedures.] 40 Kurtz SM, et. al (2008). Infection Burden for Hip and Knee Arthroplasty in the United States. The Journal of Arthroplasty 23:984-91. [The hospital stay for

patients with an infection at the site of an arthroplasty was approximately double that for patients without an infection.] 41 US News & World 2009 Best Hospitals Report Methodology Report. http://static.usnews.com/documents/health/2009-best-hospitals-

methodology.pdf?s_cid=related-links:TOP. 42 “Radiation Offers New Cures, and Ways to Do Harm,” New York Times, January 23, 2010. http://www.nytimes.com/2010/01/24/health/24radiation.html. 43 Klatt, B.A., et al. (2008). Custom-Fit Total Knee Arthroplasty (OtisKnee) Results in Malalignment. The Journal of Arthroplasty 23:26-29.

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