NuVasive (San Diego, CA) faced Q2 losses due to its ongoing patent war with rival Medtronic. The company also faces a probe by the Office of the Inspector General at the United States Health & Human Services Department.

For Q2, NuVasive posted losses of $6.5 million on total revenue of $165.7 million. This represents sales growth of 7.3% from the same period during 2012.

Unfortunately, this small wave of good news was metered against a vast tide of red ink. The company faced a $7.9 million increase in royalty reserve costs following a ruling by a federal judge. In total, the company must pay Medtronic $101 million in patent infringement damages and royalties.

In a regulatory filing, the company revealed that the HHS Office of the Inspector General issued a subpoena in connection with alleged improper Medicare and Medicaid claims. The subpoena covered documents created from 2007 until this year.

The company did note that it is working with the OIG to understand the scope of the issue, but NuVasive alleges that it doesn't have a full understanding of the issue at the time. Since the OIG subpoena is very broad, the company doesn't know the full impact it will have.

"Results in the first half of 2013 demonstrate solid execution against a multi-year plan, and give us increased confidence in our ability to execute to the full year guidance we have outlined. Importantly, we are cultivating the pillars of NuVasive's foundation to sustain earnings growth well into the future," stated CEO Alex Lukianov.