GS Medical USA LLC: Spinal Implant Supplier

GS Medical USA LLC (GSM) is a fully-owned subsidiary of GS Medical Company Ltd., a Korean company that specializes in the design and distribution of spinal implants and instrumentation. The company was founded in South Korea in 2002 and purchased a California-based supplier in 2011. John Stephani, general manager of GSM, started his business in 2006 with 30 years of industry experience.

“I built it up from zero to $2 million with a partner by 2010,” Stephani recalls. GS Medical Company Ltd. recognized Stephani’s success with GSM, so he was asked to run direct operations in the Santa Cruz office after the company’s buyout.

GSM serves the needs of neurological and orthopedic spinal surgeons across the country and even internationally. “We only do spinal fusion products, like screws, hooks and PEEK cages that are inserted into the disc spaces in the degenerative spine,” says Stephani. With rising medical costs, GSM’s business depends on providing high-quality implants at lower costs. The design department at GSM works collaboratively with surgeons and medical engineers to constantly improve products for efficiency both in cost and functionality.

High-tech Materials and Design for Spinal Fixation

The GSM line of products is specific, yet broad enough to serve various needs in purpose and sizing for spinal procedures. One of GSM’s staple products is the pedicle screw, sometimes used in spinal fusion for added stability. Conditions that may require the use of pedicle screws include disc herniation, tumors, fractures and several diseases of the spine.

Pedicle screws are made of a specialized medical grade, corrosion-resistant titanium alloy compatible with MRIs. GSM offers two separate lines of pedicle screws, including a more robust option as well as a smaller gauge rod option for minimally invasive procedures, assisting surgeons in techniques marked by smaller incisions and minimal muscle resection. These operations are usually less time-consuming, less painful and reduce the risk of excessive blood loss. In most cases after these surgeries patients recovery quicker and secure a better quality of life.

GSM designs another component for spinal repairs called interbody cages. These products are made of a biocompatible polymer formed into implants that mimic the same properties of bone. The cage is inserted surgically into the cleaned out disc space to augment stability while fusion takes place. The implants are designed with large openings or windows, allowing bony ingrowth to increase stability. The PEEK polymer material has the same elasticity as that of bone, which prevents stress risers that occur in the more rigid titanium implant options.

A Changing Industry

The American market for these supplies has made a turnaround from exporting to importing. “In Korea, the reimbursement price couldn’t support the import price,” explains Stephani. “They started making spinal products themselves, basically a copy of the American products.”

The products were made at such a significantly lower cost that United States-based companies like GSM began importing them. “The American-made implant would sell to hospitals or distributors for $1,500 and we were selling the import product for half that price,” he says.

As the American subsidiary, GSM is involved in the design process and receiving, but does not manufacture its products in the United States, though the products are distributed in 30 states. The company works with buying groups to market GSM products to medical professionals and distributors across the country. GSM is fairly small, but Stephani says the company has been growing steadily since its inception. “Our revenue is growing gradually,” he says proudly.

GSM’s technologies have been in use since the 1960s, but the market has only existed in a real sense for the last 20 years. “It’s a young industry, but there are billions of dollars in it,” Stephani explains. Because these implants are made at a significantly lower cost overseas, the import sector of the business has seen a large increase in market share. “There are foreign companies entering the market almost daily with a low-cost profile,” he explains.

Stephani’s success continues due to this extensive expertise in the industry. His background in international sales spans decades and his involvement with seven successful start-ups has also added to his proficiency. Currently he employs a simple mathematical system for determining the financial success of GSM based upon quarterly and yearly growth factors.

“If your growth measure at double digits above what the industry growth rate is doing, you’ve done well,” Stephani explains. With added foreign competition in the market, as well as a continued increase of United States-based start-ups, Stephani has seen industry growth slow down over the past few years. However, GSM is still measuring up.

GSM’s ability to compete makes price a priority, but in the complex, delicate world of spinal surgery, quality and innovation come first. Stephani looks forward to years of sustained growth through expanding sales networks and recruiting American surgeons to cooperatively develop new technologies. The company’s work has helped to drive down not only the cost, but also the dangers of spinal operations in the United States. Through professional relationships with doctors and engineers, GS Medical USA LLC continues to build upon a core line of fusion products to provide a more diverse offering in affordable medical products.