Medtech fundings for June 2013

Medical technology fundings for June 2013 reached a total of $558 million.

Below are the top fundings for the month.

  • Valeritas, Inc. has raised $100 million (insulin delivery device)
  • Mevion Medical Systems, Inc., has raised $55 million (proton therapy for cancer)
  • Spinal Modulation, Inc., has raised $45 million from St. Jude Medical (intraspinal neuromodulation for the management of pain)
  • Baxano Surgical, Inc., has raised $37.29 million (minimally invasive treatments of the lumbar spine)
  • Lombard Medical, Inc., has raised $32 million (aortic stent graft)
  • Vertos Medical, Inc., has raised $23 million (treatment for lumbar spinal stenosis)
  • Vital Therapies, inc., has raised $22.5 million (bioartificial liver)
  • Acutus Medical, Inc., has raised $20.6 million (cardiac arrhythmia mapping)

For the complete list of fundings, see link.

Medtech from incremental to quantum leap advances

Advanced medical technologies become advanced by the application of innovation that results in more effective, less costly or otherwise arguably better outcomes (including reduced risk of complications or disease recurrence) for patients, including in some cases enabling treatment when none was previously possible. It is intrinsic to every entrepreneur that the idea he/she is pursuing accomplishes this.

Manufacturers of products on the market have an imperative to either improve upon those products or make them obsolete. This imperative is manifested in a spectrum of planned innovation from simple incremental innovations to the quantum leap of a radically new approach.

There is an enormous amount of technology development, often applicable to multiple different clinical applications, that will be realized in product markets in the future. For the moment, though, I would like to look beyond “incremental improvements” or “product line extensions” or other marginal advances that serve little more than superficially addressing shortcomings of existing products on the market. I would like to look at waves of innovation coming in the short to long term that are expected to impact medtech in ways that are increasingly “radical” or represent varying orders of magnitude of improvement in results.

Three categories spanning short, mid, and long reflect what I see in medtech development. Below, I outline the nature of each and the specific examples that are or will be emerging.

Short term. With change encompassing technologies that are just sufficiently different so that they cannot simply be called incremental innovations, some short term advances often combine two or more complementary and/or synergistic technologies in new ways to advance healthcare. Examples include:

  • Image-guided surgeries to augment the surgeon’s ability to navigate complex anatomy or discern the margins of healthy versus disease tissue.
  • Natural orifice endoscopic surgery (and shift in general from invasive to interventional and intraductal procedures) to either drastically reduce or eliminate the trauma of surgical access
  • Non-invasive therapeutics (like lithotripsy, gamma knife, others) to treat disease without trauma to collateral tissues.
  • Genome-driven treatment profiling (prescreening to determine ideal patients with high probable response).
  • Personalized (custom) implants. These already exist in orthopedics, but the potential for customized implants in gastroenterology, cardiology, and many other clinical areas is wholly untapped.
  • Regenerative technologies (bone, skin, other). These technologies represent introductory markets with lowered challenge compared to more complex functional anatomy (e.g., vital organs).
  • Smart devices (implantable sensors, RFID-tagged implants, etc.) to provide data to clinicians on implant location and status or, in the extreme respond diagnostically or therapeutically to changes in the implant’s immediate environment.

Mid-term. These are new therapeutic options that are fundamentally different than those in current use for a given treatment option. These are technologies that have demonstrated high probability of being feasible in large scale use, but have not yet accumulated enough clinical data to warrant full regulatory approval.

  • Nanotech surface technologies for biocompatibility, localized treatment delivery or other advantages at the interface between patient and product.
  • Materials that adapt to changes in implant environment, to maintain pH, to release drugs, to change shape.
  • Artificial heart. A vital organ replacement that currently has demonstrated the capacity to be a bridge to transplant but has also advanced sufficiently to open the possibility of permanent replacement in the not-too-distant future.
  • Cell/device hybrids. These are organ replacements (e.g., kidney, lung, liver) performing routine function or natural organs, but configured in a device to address unresolved issues of long term function, immune response and others.
  • Artificial organs (other than heart) — closed loop glucometer/insulin pump (artificial pancreas). These are not even partial biological representations of the natural organ, but completely synthetic “organs” that intelligently regulate and maintain a steady state (e.g., blood glucose levels) by combining the necessary functions through combined, closed-loop mechanical means (an insulin pump and glucometer with the necessary algorithms or program to independently respond to changes in order to otherwise maintain a steady state.

Long-term. Orders of magnitude, quantum shift, paradigm shift or otherwise fundamentally different means to serve clinical need.

  • 3D implant printing. In a recent example, in an emergency situation a 3D implant for repair of a infant’s trachea was approved by the FDA. These implants, as in the case of the trachea repair, will most often be customized for specific patients, matching their specific anatomy and may even include their (autologous) cells. They may also be made of other materials including extracellular matrices that will stimulate natural cell migration followed eventually by bioabsorption of the original material. Depending upon type of material and complexity of the anatomy, these technologies may emerge in the near or distant future.
  • Gene therapies. Given the root cause of many diseases has a genetic component or is entirely due to a genetic defect, gene therapies will be “permanent corrections” of those defects. An enormous number of hurdles remain to be crossed before gene therapies are largely realized. These deal with delivery and permanent induction of the corrected genes into patients.
  • Stem cell therapies. The potential applications are many and the impact enormous of stem cell therapies, but while stem cell technology (whether for adult or embryonic) has made enormous strides, many challenges remain in solving the cascade of differentiation while avoiding the potential for aberrant development of these cells, sometimes to proliferative (cancerous) states.
  • “Rational” therapeutics. Whether by stem cell therapies, gene therapies or other biochemical or biological approach, “rational” therapeutics represent the consummate target for medical technology. Such therapeutics are “rational” in the sense that they perfectly address disease states (i.e., effect cures) without complication or need for recurrent intervention.

There are certainly more holes than fabric in this tapestry of short-, mid- and long-term technology innovation, but this should serve to illustrate the correlation between the sophistication of the potential medtech solution and the level of technical challenge in order to achieve each.

 

Technologies at recently identified medtech startups

Below are the technologies under development at recently identified startups that have been added to the Medtech Startups Database.

  • Devices in interventional neuroradiology including for treatment of aneurysm.
  • Device for the removal of hemorrhoids.
  • Undisclosed medical technology.
  • Medical device company focused on the treatment of prostate cancer.
  • Retinal imaging test for the detection and diagnosis of Alzheimer’s Disease.
  • Non-immunogenic xenograft heart valves.
  • Visualization in orthopedic, spine and sports medicine procedures.
  • Minimally invasive retractor for use in spine surgeries (micro-endoscopic discectomies).
  • Spinal cord stimulation for pain management
  • Spinal implant with sensor.

 

 

Reference reports in Ophthalmology, Coronary Stents and Tissue Engineering

MedMarket Diligence has added three previously published, comprehensive analyses of  medtech markets to its Reference Reports listings. The markets covered in the three reports are:

  • Ophthalmology Diagnostics, Devices and Drugs (see link)
  • Coronary Stents: Drug-Eluting, Bare, Bioresorbable and Others (see link)
  • Tissue Engineering, Cell Therapy and Transplantation (see link)

Termed “Reference Reports”, these detailed studies were initially completed typically within the past five years. They now serve as exceptional references to those markets, since fundamental data about each of these markets has remained largely unchanged. Such data includes:

  • Disease prevalence, incidence and trends (including credible forecasts to the present)
  • Clinical practices and trends in the management of the disease(s)
  • Industry structure including competitors (most still active today)
  • Detailed appendices on procedure data, company directories, etc.

Arguably, a least one quarter of every NEW medtech report contains background data encompassing the data listed above.  Therefore, the MedMarket Diligence reports have been priced in the single user editions at $950 each, which is roughly one quarter the price of a full report.

See links above for detailed report descriptions, tables of contents, lists of exhibits and ordering. If you have further questions, feel free to contact Patrick Driscoll at (949) 859-3401 or (toll free US) 1-866-820-1357.

See the comprehensive list of MedMarket Diligence reports at link.

 

Recent Clinical/Technology Distribution of Medtech Startups

Since January 2011, we have identified 158 medical technology companies that have been founded globally. As in the past when we have discussed “medtech” companies, whether in the context of startups or in fundings, we would like to make clear what we define as medtech:

What is “medtech”?: We view medical technology (medtech) as principally medical devices and equipment, but also all technologies that are directly competitive with or complementary to technologies represented by therapeutic or diagnostic medical devices/equipment.

An enormous range of technologies are under development at these companies (see our detailed list of technologies from past years at link). For the sake of our database subscribers interested only in specific clinical/technology areas, we categorize the companies accordingly (based on the nature of their technologies or clinical application). Below is represented the distribution of technologies at the companies identified from 2011 to May 2013. Note, please, that multiple clinical/technology categories are possible for each company, so the pie chart below represents the whole not as the total number of companies, but a multiple of the number of companies and clinical/technology areas.

startups-2011-2013

Source: MedMarket Diligence, LLC; Medtech Startups Database.

 

 

Worldwide Surgical Sealants, Glues, Wound Closure and Anti-Adhesion Market, Forecast to 2017

Potential for the Use of Hemostats, Sealants, Glues and Adhesion Prevention Products, Worldwide

This report details the complete range of sealants & glues technologies used in traumatic, surgical and other wound closure, including tapes, sutures/staples/mechanical closure, hemostats, fibrin sealants/glues and medical adhesives and anti-adhesion products. The report details current clinical and technology developments, with data on products in development (detailing market status) and on the market; market size and forecast; competitor market shares; competitor profiles; and market opportunity. The report provides full year actual data from 2011. The report provides a worldwide forecast to 2017 of the markets for these technologies, with emphasis on the market impact of new technologies through the forecast period. The report provides specific forecasts and shares of the worldwide market by segment for Americas (detail for U.S., Rest of North America and Latin America), Europe (detail for United Kingdom, German, France, Italy, Spain, Rest of Europe), Asia/Pacific (detail for Japan, Korea, Rest of Asia/Pacific) and Rest of World. The report provides background data on the surgical, disease and traumatic wound patient populations targeted by current technologies and those under development, and the current clinical practices in the management of these patients, including the dynamics among the various clinical specialties or subspecialties vying for patient population and facilitating or limiting the growth of technologies. The report establish the current worldwide market size for major technology segments as a baseline for and projecting growth in the market through 2017. The report assesses and projects the composition of the market as technologies gain or lose relative market performance over this period. The report profiles 122 active companies in this industry, providing data on their current products, current market position and products under development.

See description, table of contents and list of exhibits at http://www.mediligence.com/rpt/rpt-s190.htm Published February 2012..

Advice to forward-looking medtech manufacturers (and their competitors)

trainWill Rogers said, “Even if you are on the right track, you’ll get run over if you just sit there.” The current challenge for medtech manufacturers is that, as a result of a wide range of forces, trends and developments, the train that threatens to run them over has gotten a whole lot faster. Below is a short list of perspectives that is needed by medtech manufacturers and their competitors in order to stay ahead of the train.

  • Focus on your competitors’ solutions, not their products. Stent manufacturers (and this is just an example) are not competing only against stent manufacturers; they are also competing against drug-eluting balloon angioplasty, atherectomy, percutaneous myocardial revascularization, atherosclerotic plaque-reducing drugs, myocardial stem cell therapy and other device, drug, biotech and other options.  The focus is on the disease and all the alternative ways to treat it (even preventing it). And it bears reminding that a duty of your market intelligence is to keep a watchful eye on the broadest possible definition of potential competitors — gene therapy, holistic medicine, eastern medicines.
  • Be careful where you draw the line on your product’s features. There are many choices to be made in designing and engineering a medical product. The more you build into the product (being resorbable, being intelligent, having biocompatibility coating, having embedded drug(s), etc.), the more benefits you can potentially claim, but the more arduous the engineering, testing and regulatory approval will be.  The traditional advantage medical devices have over drugs has been that devices are “inert”, accomplishing their therapeutic endpoint without the large scale side effects possible with systemically active drugs.  The more devices are imbued with drugs, made of resorbable material or have any kind of interactive capability with the tissue around them, the more likely will be occurrence of adverse effects.
  • Directly or indirectly, your product must be viewed as lowering healthcare cost. In real terms, a product that demonstrably lowers costs compared to alternatives has a decided advantage. However, your product has only to give the appearance of saving money, or at least clearly suggests that it will not raise healthcare costs. Directly, if you can point to units per patient and average selling price and you can point to explicit cost saving compared to currently used products, you’ve gained an advantage. Short of that, you can gain advantage if you can make a defensible cast that your product leads to indirect cost savings such as in less trauma, less collateral damage, faster healing times and similar.
  • “Zero invasiveness” is the target. Expect increasing numbers of percutaneous and “natural orifice” procedures at the expense of not only open surgical procedures but also laparoscopic procedures. Too many surgical and interventional formats, and support systems for them, have been developed that signal the end of the need for invasive procedures.  And whether the procedure is done laparoscopically, endoscopically, percutaneously, or even radiosurgically, the need to cut, resect/excise or otherwise physically alter anatomy or morphology to address pathology will be obviated by, and be less attractive than, effective non-surgical/non-interventional approaches.
  • “Personalized medicine” may be largely theoretical, or at least largely unrealized, BUT the potential to be able to predetermine when therapies will or will not work is too significant in its implications to ignore. (Looking at this another way, I recently spoke with a pharmaceutical colleague who noted that blood markers in patients with a particular condition could help them screen out 97% of the diagnosed patients for whom their therapy would be ineffective.  Their conclusion was not that the drug was 97% ineffective but that, for 3% of the diagnosed population, the drug would be highly effective and therefore highly profitable.)
  • The pace of change is accelerating. Developments in material sciences, the growth in applied understanding of basic life sciences, the emergence of “paradigm-shifting” industries like stem cell and tissue regeneration, the rewards being reaped by genome sequencing, the integration of advanced information technologies in drug discovery, simulated device prototype testing and other advances are dramatically shortening the gap between idea and market introduction, reducing product life cycles (accelerating obsolescence) and increasing the intensity of competition for all manufacturers.

The advice for any medtech manufacturer — or, for that matter, any manufacturer of a product competing against a “medtech” product — is that they must continually address the view of their competitive landscape to recognize and be prepared to respond to real and perceived competition, trends, forces and opportunities.