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ArthroCare's Three-Pronged Spine Play

ArthroCare's recent purchase of Parallax gives the company a broader platform from which to build a spine business based on its innovative Coblation technology. While ArthroCare currently can play in microdiscectomies, the bread and butter of spine surgeons, its most promising opportunity: the vertebral compression market that Kyphon has had such success with.

Given all of the interest in the booming spine market, it's tempting to see success driven by a series of technology debates: fusion versus disc/nucleus arthroplasty, for example, or the clinical and economic value of minimally invasive procedures as compared to open techniques. But as ArthroCare Corp. 's recent acquisition of Parallax Medical Inc. makes clear [See Deal], behind the technology debates lies a bigger issue, that of market adoption and finding the appropriate business model.

While the Parallax acquisition represents a major boost for ArthroCare's spine program, it isn't the company's first foray in this...

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