Normal neural activity results from a balance of electrical and chemical signals that are vulnerable to disruption by trauma to the nervous system. Similar to the way a cardiac pacemaker corrects heartbeat abnormalities, neuromodulation therapies help to re-establish normal neural function by allowing focused delivery of therapeutic agents to precisely targeted areas of the nervous system. 

The most common neuromodulation therapy is spinal cord stimulation. California's privately owned Spinal Modulation has developed a new pain management option for patients with chronic, intractable pain -- the Axium Neurostimulator System, which targets the dorsal root ganglion of the spinal cord and consists of a specialized lead, delivery platform, and electrical stimulator.

St. Jude Medical (NYSE:STJ) announced Friday that it has entered into a series of agreements whereby St. Jude will invest $40 million in SM. The agreement provides St. Jude with an exclusive option to distribute the Axium Neurostimulator in international markets in which it is approved for sale. St. Jude will also have the exclusive option to acquire all of SM for up to $300 million, plus payment of certain revenue-based milestones, following U.S. commercialization of the product. 

An estimated 30% of the U.S. population suffers from chronic pain, and of those, approximately 32% suffer from severe chronic pain. 

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