Shifting demand, sales in aesthetics and reconstructive products markets

Data from our report, “Global Markets for Products and Technologies in Aesthetic and Reconstructive Surgery, 2013-2018”, illustrates the changing demand for different procedures in aesthetics and reconstructive medicine, which is resulting in projected shifts in the sales of products.

Below is are the compound annual growth rates (CAGRs) for North American sales in the major types of aesthetic and reconstructive procedures.

Screen Shot 2014-05-29 at 10.44.45 AM

Source: MedMarket Diligence, LLC; Report #S710.

The Staying Power of Spine Surgery Markets

While medtech over the past five years has seen continued pressure on prices, increased oversight on physician-manufacturer relationships, reduced med/surg procedure volumes, continued regulatory challenges and the real or perceived negative impacts of the Affordable Care Act, the business of spine surgical technologies remains one of the most steadfast oases of innovation and price stability.

The continued growth of spine surgery owes itself to a number of key drivers:

  • The ageing population worldwide
  • Increasing incidence of obesity
  • A growing middle class in developing countries, with the ability to pay out of pocket for spine surgery
  • Improving worldwide economy
  • Technological device enhancements, leading to improved surgical results
  • Developments in minimally invasive spine surgery (MISS) devices driving a strong increase in MISS, with its numerous advantages
  • In the US, improvements in reimbursement as clinical trials demonstrate the efficacy of treatments using the devices
  • US healthcare reform leading to medical insurance coverage for more people, allowing those suffering from intractable back pain to receive surgical treatment

(The last, of course, is debatable, since medical device manufacturers are not yet convinced that a 3.2% excise tax is supported by the anticipated boost in patient population. The jury is still out on this and, in any case, prospects for the 3.2% tax being repealed are slim, despite repeated efforts.)

Consequently, the worldwide aggregate spine surgery market has a 2012 to 2020 compound growth rate of 7.7%, with individual segments within it growing at a low of 2.3% to a high of 35.0%.

It is also worth noting that we have identified seven (7) new medtech startups (McGinley Orthopaedic Innovations, KB Medical, Trice Orthopedics, Tyber Medical, Direct Spinal Therapeutics, NLT Spine, Osseus Fusion Systems) in spine surgery that have been founded in the past three years alone.

Below is illustrated the spine surgery markets in the Americas and Europe for 2012-2020.

Screen Shot 2014-05-28 at 10.33.52 AMScreen Shot 2014-05-28 at 10.34.10 AM

Source: MedMarket Diligence, LLC; Report #M520, “Worldwide Spine Surgery: Products, Technologies, Markets and Opportunities 2010-2020”.

Growth versus volume in medtech

See also the December 2015 report, “Worldwide Wound Management, Forecast to 2024:
Established and Emerging Products, Technologies and Markets
in the Americas, Europe, Asia/Pacific and Rest of World”, Report #S251.


One of the more interesting aspects of well-established markets that have significant volume in medical technology product sales is that the revenue and the caseload are sufficient to drive fairly a continuous range of technologies that will meet patient demand. As a result, there tends to be a continuum between high-volume, low-growth and low-volume high-growth. This significance should be apparent to active or potential market participants.

This continuum can be represented in two noteworthy ways, each of which illustrates the inverse relationship between the size of a market segment and its growth. For example, one of the most well established medtech markets is traditional bandages and dressings in wound management. These are simple to manufacturer, applicable to a wide range of wound types, require little clinician knowledge to use and, therefore, widely used throughout the world. They represent very large volume, in the $billions worldwide. At the other end of this spectrum are emerging technologies such as the use of growth factors in wound management. They have a large, as yet untapped potential, so their anticipated growth is high, while their current volume still remains very low, at least by comparison to traditional wound dressings.

Here is how these two technologies appear at the ends of the spectrum in wound management, between which are large numbers of different wound management technologies.
20140523-114241-42161375.jpg
Source: MedMarket Diligence, LLC; Report #S249.

The second way this can be represented is the relative share of the market represented by each as they change over time given their differing sales growth rates. Below is an illustration of the net change in share of the total market for wound management products by each product type. Again, there is a noticeable continuum.

20140523-114506-42306054.jpg

Source: MedMarket Diligence, LLC; Report #S249.

See the December 2015 report #S251, “Wound Management, and the July 2016 report #S290, “Sealants, Glues, Hemostats, 2015-2022.”

Who drives medtech development?

A recent survey of medtech executives suggested that “patient needs” took priority over “doctor’s ideas” in medtech development. Seriously? And how exactly do patients define their needs? “I’m a 53 year old man with acute coronary artery disease (you see, I have 85% occlusion in my left-anterior descending coronary artery), so I really feel strongly that we should be developing more sirolimus-coated stents to affect a better outcome in terms of reduced restenosis. Gosh, I’d really like to have a few more years of good fishin’.”

Ludicrous.

The amount of medtech funded is often less than half the story

In tracking venture capital or other money flowing into “medtech”, I am frequently struck by how often the numbers that are presented as evidence tell only part of the picture, like one of the several blindfolded men touching different parts of an elephant tasked with identifying what it is they are touching.

Recent results from Pricewaterhouse Coopers on Q1 2014 venture capital paints a picture illustrating an 11% increase from Q1 2013 to Q2 2014 in total funding for “medical device” companies, with a drop in the number of deals, from 29 to 25.

There are two problems with this, the first being that the fundings data so presented is only looking at “medical device” companies, the second being that we have no evidence on the number of companies seeking funding in either year.

First, talking about medical devices in 2014 is a lot like talking about horses in 1910.  Neither one tells the whole story of the markets in which they very clearly compete. Second, while the amount of money actually funded by VC in 2014 versus 2013 is obviously important (especially to the recipients), the number and size of the deals rejected in both years is also rather important as well (especially to the non-recipients).

So, what should be presented differently? Well, tracking the “medical device” industry is just not relevant anymore (I’ve already argued this ad nauseum), since medical devices don’t just compete with medical devices anymore — for clinical applications or venture funding. In my opinion, the tracking of funding should first look at funding in, say, coronary artery disease treatment (i.e., “disease state”), then consider the share of that funding that is going toward this or that therapeutic option. As for the amount funded, would it not be meaningful to all involved to track the amount of actual versus proposed funding, especially if the proposed funding was limited to actual deals that were ultimately accepted or rejected?

Below is the amount of funding in “medtech”* by month from January 1, 2009, to May 21, 2014, presented both as an annual overlay to reflect seasonality and as a continuum, with a linear trendline.

Screen Shot 2014-05-21 at 1.02.36 PM

 

 

Screen Shot 2014-05-21 at 1.12.37 PM

Source: MedMarket Diligence, LLC

_________________________
*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.

Note: Historic coverage of “medtech” has been limited to medical devices, supplies and equipment. We feel that such a limited definition poorly reflects the true nature of the markets that once were limited to such products. In reality, assessing the markets and competition for medical devices by ONLY considering other medical devices would result in gross underestimations of both competition and market potential. Moreover, this is reflected in both the nature of medical devices, which may be hybrid device/bio/pharm products or products that may not be “devices” at all, especially in the typical definitions defined by material type and function, but that compete head-on with devices.

 

Established to emerging, commodity to advanced in wound management

Wound management is about as diverse a market as there can be in medtech. Wounds can be acute or chronic, surgically created or arising from trauma or disease, treated with technology as simple as a piece of gauze or as complex as a hyperbaric oxygen chamber or negative pressure would therapy technology.  The manufacturers range from producers of largely commodity-like dressings to devices to equipment to growth factors and other biotech products.

Simultaneously, the nature of patient populations, clinical practices, market development, economics and technology adoption vary widely around the world, resulting in considerable variation in the sales of traditional products all the way up through the most advanced products in wound management.

As an example, below are illustrations of the 2011 to 2020 forecast for the range of wound management products in the U.S. and a different set of markets, the Rest of Asia/Pacific (excluding Japan and Korea); predominantly China, India and Australia.

The distribution of product sales in wound management, on a relative basis, is very different in the U.S. than in the Rest of Asia/Pacific due in large part to the tendency for advanced technologies to be first introduced in well developed markets, like the U.S., Europe, Japan and others and later migrated to the “emerging” markets. T

The U.S. graph illustrates the decreasing/increasing share of each technology’s sales relative to all others.

Screen Shot 2014-05-20 at 3.23.43 PM

Source: MedMarket Diligence, LLC; Report #S249

For the Rest of Asia/Pacific Market, a different picture emerges, with interesting variations per product segment.

 

 

Screen Shot 2014-05-20 at 3.23.58 PM

Source: MedMarket Diligence, LLC; Report #S249

However, to put the relative differences into a meaningful context, one has to look at the absolute sales in the different markets. And, to show the very real, stark difference between the U.S. and Rest of Asia/Pacific markets for wound management products, we have plotted both on the same scale, with the max given for both as $12,000 million in sales.

 

 

Screen Shot 2014-05-20 at 3.24.16 PM

Source: MedMarket Diligence, LLC; Report #S249

Screen Shot 2014-05-20 at 3.29.56 PM

Source: MedMarket Diligence, LLC; Report #S249

2013 Medtech Startups — What and Where Are They?

I saw some coverage this month regarding the innovation in medtech in 2013, but I was surprised to see that it was limited to coverage of the companies who received PMA approvals and didn’t detail the specific technologies or where these technologies arose (by country or state).

Therefore, I thought I would detail the innovation in medtech that I have seen in 2013 based on the number of medtech startups for the year, what the specific technologies were, and the country and, if USA, the state. Of course, the receipt of a PMA and the founding of a company rarely (if ever) occur in the same year, so my focus on 2013 startups is really looking more into the future than if I were looking at 2013 PMAs.

So, below are the technologies under development at medtech startups:

  • Biomatarials for bone regeneration.
  • Vascular drill to cross chronic total obstructions and facilitate balloon angioplasty and stunting.
  • Non-invasive, migraine therapy device worn on the back of the head at the onset of or during a migraine to relieve pain.
  • Endoscopic, minimally-invasive harvesting of veins used for coronary artery bypass grafting.
  • Detection of concussion.
  • Various medical devices, including a device to assist laparoscopic surgery and pain management device.
  • Undisclosed technology for the treatment of aneurysm.
  • Implantable electrospun neurosurgical meshes and tools.
  • Undisclosed medical technology development. Affiliated with [VC firm].
  • Undisclosed medical technology relating to allografts.
  • Developing “generic” versions of medical technology.
  • 3D live, microscopic imaging technology for in vitro and in vivo use.
  • Undisclosed neuro technology.
  • Developing a leadless implantable cardioverter defibrillator.
  • Implant remote sensor technology.
  • Intramedullary rods and other orthopedic implants.
  • Single-use device to prevent postpartum hemorrhage.
  • Products for weaning from mechanical ventilation and use for patients with COPD.
  • Undisclosed spine treatment.
  • Left ventricular assist device.
  • Hypothermia device for patients with cardiac arrest, traumatic brain injury, stroke and concussion.
  • Systems for minimally invasive knee implants.
  • Hemostat/sealant.
  • Noninvasive blood glucose monitor.
  • Device to reduce sternal bleeding associated with cardiac surgery.
  • Lightweight and low cost 12-lead diagnostic ECG device.
  • Ultrasound-based brain noninvasive physiology measurement of cerebral blood flow and intracranial volumetric wave monitoring.
  • Device for the management of urinary incontinence.
  • Haptic device used in rehabilitation following stroke or neurological injury.
  • Biodegradable sealants and adhesives in surgery.
  • Developing a device that mimics the actions of gastric bypass surgery for the treatment of obesity and Type 2 diabetes.
  • Embolectomy devices
  • Ocular stent for treating age-based vision changes.
  • Ophthalmic device company focusing on age-related macular degeneration, diabetic retinopathy, retinitis pigmentosa, hemianopia, and glaucoma.
  • Neuroscience-based technology (neuromodulation) for enhancing performance on cognitive tasks, for the healthy and impaired.
  • Portable, ultrasound-based device non-invasive, transcranial diagnosis of stroke.
  • Temporary cardiac pacing as treatment for reversible symptomatic bradycardia.
  • Use of biomaterials in aesthetics for non-surgical temporary & permanent breast and buttock enhancement, facial rejuvination solutions and adipose tissue engineering related therapies.
  • Custom surgical implants including using 3D printing.
  • Device to harvest bone grafts
  • Magnetoencephalography and magnetocardiography.
  • Devices for cardiac and vascular procedures designed for easier use and lower cost.
  • Radiofrequency ablation probe for the treatment of breast cancer.
  • Laparoscopic instruments designed to make surgeries less invasive and produce no scarring.
  • Insulin delivery alternative to pens and syringes.
  • Orthopedic implant technologies including a force sensor to measure performance of an orthopedic articular joint.
  • Insulin patch pump for treatment of insulin-dependent type 2 diabetes.

This is a wide range of technologies. To distill it down and summarize it, below is the distribution of the clinical or technology categories into which these fall. (Note that multiple categories are possible, such as “minimally invasive” and “surgery”.)

Screen Shot 2014-05-12 at 11.24.56 AM

 Source: Medtech Startups Database, MedMarket Diligence, LLC

The bulk of medtech startups we identify are from the U.S., both due to the fact that most medtech startups globally are in the U.S. and that it is simply easier for us to identify U.S. startups. Here is the distribution nonetheless:

Screen Shot 2014-05-12 at 11.16.39 AM

 Source: Medtech Startups Database, MedMarket Diligence, LLC

Within the U.S., there is a wide distribution of states where this technology resides and, while there is typically a dominance of companies in California, there has been a shift in recent years [Editor’s note: 4 Jan 2016 — California remains strong in startups]  as state-based initiatives and incentives (include tax-based) drive creation of more startups in other states. Below is the distribution of 2013 U.S. medtech companies by state.

Screen Shot 2014-05-12 at 11.16.48 AM  Source: Medtech Startups Database, MedMarket Diligence, LLC

Where will medicine be in 20 years?

(This question was originally posed to me on Quora.com. I initially answered this in mid 2014 and am revisiting and updating the answers now, in mid 2015.)

An important determinant of “where medicine will be” in 2035 is the set of dynamics and forces behind healthcare delivery systems, including primarily the payment method, especially regarding reimbursement. It is clear that some form of reform in healthcare will result in a consolidation of the infrastructure paying for and managing patient populations. The infrastructure is bloated and expensive, unnecessarily adding to costs that neither the federal government nor individuals can sustain. This is not to say that I predict movement to a single payer system — that is just one perceived solution to the problem. There are far too many costs in healthcare that offer no benefits in terms of quality; indeed, such costs are a true impediment to quality. Funds that go to infrastructure (insurance companies and other intermediaries) and the demands they put on healthcare delivery work directly against quality of care. So, whether it is Obamacare, a single payer system, state administered healthcare (exchanges) or some other as-yet-unidentified form, there will be change in how healthcare is delivered from a cost/management perspective.

From the clinical practice and technology side, there will be enormous changes to healthcare. Here are examples of what I see from tracking trends in clinical practice and medical technology development:

  • Cancer 5 year survival rates will, for many cancers, be well over 90%. Cancer will largely be transformed in most cases to chronic disease that can be effectively managed by surgery, immunology, chemotherapy and other interventions.
    [View Aug. 2015: Cancer has been a tenacious foe, and remains one we will be fighting for a long time, but the fight will have changed from virtually incapacitating the patient to following protocols that keep cancer in check, if not cure/prevent it.] 
  • Diabetes Type 1 (juvenile onset) will be managed in most patients by an “artificial pancreas”, a closed loop glucometer and insulin pump that will self-regulate blood glucose levels. OR, stem cell or other cell therapies may well achieve success in restoring normal insulin production and glucose metabolism in Type 1 patients. The odds are better that a practical, affordable artificial pancreas will developed than stem or other cell therapy, but both technologies are moving aggressively and will gain dramatic successes within 20 years.
    [View Aug. 2015: Developments in the field of the “artificial pancreas” have recently gathered considerable pace, such that, by 2035, type 1 blood glucose management may be no more onerous than a house thermostat due to the sophistication and ease-of-use made possible with the closed loop, biofeedback capabilities of the integrated glucometer, insulin pump and the algorithms that drive it, but that will not be the end of the development of better options for type 1 diabetics. Cell therapy for type 1 diabetes, which may be readily achieved by one or more of a wide variety of cellular approaches and product forms (including cell/device hybrids) may well have progressed by 2035 to become another viable alternative for type 1 diabetics.] 
  • Diabetes Type 2 (adult onset) will be a significant problem governed by different dynamics than Type 1. A large body of evidence will exist that shows dramatically reduced incidence of Type 2 associated with obesity management (gastric bypass, satiety drugs, etc.) that will mitigate the growing prevalence of Type 2, but research into pharmacologic or other therapies may at best achieve only modest advances. The problem will reside in the complexity of different Type 2 manifestation, the late onset of the condition in patients who are resistant to the necessary changes in lifestyle and the global epidemic that will challenge dissemination of new technologies and clinical practices to third world populations.
    [View Aug. 2015: Despite increasing levels of attention being raised to the burden of type 2 worldwide, including all its sequellae (vascular, retinal, kidney and other diseases), the pace of growth globally in type 2 is still such that it will represent a problem and target for pharma, biotech, medical device, and other disciplines.] 
  • Cell therapy and tissue engineering will offer an enormous number of solutions for conditions currently treated inadequately, if at all. Below is an illustration of the range of applications currently available or in development, a list that will expand (along with successes in each) over the next 20 years.

    [View Aug. 2015: Cell therapy will have deeply penetrated virtually every medical specialty by 2035. Most advanced will be those that target less complex tissues: bone, muscle, skin, and select internal organ tissues (e.g., bioengineered bladder, others). However, development will have also followed the money. Currently, development and use of conventional technologies in areas like cardiology, vascular, and neurology entails high expenditure that creates enormous investment incentive that will drive steady development of cell therapy and tissue engineering over the next 20 years, with the goal of better, long-term and/or less costly solutions.] 

  • Gene therapy will be an option for a majority of genetically-based diseases (especially inherited diseases) and will offer clinical options for non-inherited conditions. Advances in the analysis of inheritance and expression of genes will also enable advanced interventions to either ameliorate or actually preempt the onset of genetic disease.
    [View Aug. 2015: It’s a double-edged sword with the human genome. As the human blueprint, It is the potential mother lode for the future of medicine, but it remains a complex set of plans to elucidate and exploit for the development of therapies. While genetically-based diseases may readily be addressed by gene therapies in 2035, the host of other diseases that do not have obvious genetic components will resist giving up easy gene therapy solutions. Then again, within 20 years a number of reasonable advances in understanding and intervention could open the gate to widespread “gene therapy” (in some sense) for a breadth of diseases and conditions.] 
  • Drug development will be dramatically more sophisticated, reducing the development time and cost while resulting in drugs that are far more clinically effective (and less prone to side effects). This arises from drug candidates being evaluated via distributed processing systems (or quantum computer systems) that can predict efficacy and side effect without need of expensive and exhaustive animal or human testing.
    [View Aug. 2015: The development of effective drugs will have been accelerated by both modeling systems and increases in our understanding of disease and trauma. It may not as readily follow that the costs will be reduced, something that may only happen as a result of policy decisions.] 
  • Most surgical procedures will achieve the ability to be virtually non-invasive. Natural orifice transluminal endoscopic surgery (NOTES) will enable highly sophisticated surgery without ever making an abdominal or other (external) incision. Technologies like “gamma knife” and similar will have the ability to destroy tumors or ablate pathological tissue via completely external, energy-based systems.
    [View Aug. 2015: By 2035, technologies such as these will have measurably reduced inpatient stays, on a per capita basis, since a significant reason for overnight stays is the trauma requiring recovery, and eliminating trauma is a major goal and advantage of the NOTES technology platform. A wide range of technologies across multiple categories (device, biotech, pharma) will also have emerged and succeeded in the market by producing therapeutic benefit without collateral damage.] 
  • Information technology will radically improve patient management. Very sophisticated electronic patient records will dramatically improve patient care via reduction of contraindications, predictive systems to proactively manage disease and disease risk, and greatly improve the decision-making of physicians tasked with diagnosing and treating patients.
    [View Aug. 2015: There are few technical hurdles to the advancement of information technology in medicine, but even in 2035, infotech is very likely to still be facing real hurdles in its use as a result of the reluctance in healthcare to give up legacy systems and the inertia against change, despite the benefits.]
  • Systems biology will underlie the biology of most future medical advances in the next 20 years. Systems biology is a discipline focused on an integrated understanding of cell biology, physiology, genetics, chemistry, and a wide range of other individual medical and scientific disciplines. It represents an implicit recognition of an organism as an embodiment of multiple, interdependent organ systems and its processes, such that both pathology and wellness are understood from the perspective of the sum total of both the problem and the impact of possible solutions.
    [View Aug. 2015: This orientation will be intrinsic to the development of medical technologies, and will increasingly be represented by clinical trials that throw a much wider and longer-term net around relevant data, staff expertise encompassing more medical/scientific disciplines, and unforeseen solutions that present themselves as a result of this approach.]

There will be many more unforeseen medical advances achieved within 20 years, many arising from research that may not even be imagined yet. However, the above advances are based on actual research and/or the advances that have already arisen from that research.

Medtech Market Reports for the Resource-Constrained

As often as I gather data on medtech startups, I find myself frequently talking to eager entrepreneurs who are very enthusiastic about their technologies while confidentially bemoaning how hard it is to operate when they are pre-funded or otherwise bootstrapped.

I also frequently connect with academics, many working on their “thesis” and in dire need of market data but unable to afford the full list prices on our market and technology reports (which I find dubious unless their email address ends in “.edu”).

Therefore, it seemed appropriate that I find a way to satisfy these eager would-be or otherwise cash-strapped entrepreneurs with a means to get useful data to help guide their businesses and even, potentially, support their fundraising efforts. What I have come up with is a selection of our full scale, global, proprietary market reports and made them available at what I’ve termed the “market starter” price of $125 each. These reports are indeed the full reports (300 to 500 pages in length, typically market priced at $3,000 or higher), but they are two or more years old — still eminently relevant in the broad coverage of market size, growth and, in particular, forecasts.

Thus far the topics of these Market Starter reports are:

  • Ablation Technologies
  • Spine Surgery
  • Obesity Management
  • Diabetes Management
  • Tissue Engineering & Cell Therapy

These reports are listed with links to the full descriptions and tables of contents, at link.

Tissue Engineering and Cell Therapy Market Outlook

The market for tissue engineering and cell therapy products is set to grow to nearly $32 billion by 2018. This figure includes bioengineered products that are themselves cells or are actively stimulating cell growth or regeneration, products that often represent a combination of biotechnology, medical device and pharmaceutical technologies. The largest segment in the overall market for regenerative medicine technologies and products comprises orthopedic applications. Other key sectors are cardiac and vascular disease, neurological diseases, diabetes, inflammatory diseases and dental decay and injury.

An overview (map) of the spectrum of clinical applications in tissue engineering and cell therapy is shown below:

Source: Report #S520

Cell therapy is defined as a process whereby new cells are introduced into tissue as a method of treating disease; the process may or may not include gene therapy. Forms of cell therapy can include: transplantation of autologous (from the patient) or allogeneic (from a donor) stem cells , transplantation of mature, functional cells, application of modified human cells used to produce a needed substance, xenotransplantation of non-human cells used to produce a needed substance, and transplantation of transdifferentiated cells derived from the patient’s differentiated cells.

Once considered a segment of biomaterial technologies, tissue engineering has evolved into its own category and now comprises a combination of cells, engineering and suitable biochemical and physiochemical factors to improve or replace biological functions. These include ways to repair or replace human tissue with applications in nearly every medical specialty. Regenerative medicine is often synonymous with tissue engineering but usually focuses on the use of stem cells.

Tissue engineering and cell therapy may be considered comprised of bioengineered products that are themselves cells or are actively stimulating cell growth or regeneration. These often comprise a combination of biotechnology, medical device and pharmaceutical technologies.

Researchers have been examining tissue engineering and cell therapy for roughly 30 years. While some products in some specialties (such as wound care) have reached market, many others are still in research and development stages. In recent years, large pharmaceutical and medical device companies have provided funding for smaller biotech companies in the hopes that some of these products and therapies will achieve a highly profitable, commercial status. In addition, some companies have been acquired by larger medical device and pharmaceutical companies looking to bring these technologies under their corporate umbrellas. Many of the remaining smaller companies received millions of privately funded dollars per year in research and development. In many cases it takes at least ten years to bring a product to the point where human clinical trials may be conducted. Because of the large amounts of capital to achieve this, several companies have presented promising technologies only to close their doors and/or sell the technology to a larger company due to lack of funds.

The goal of stem cell research is to develop therapies to treat human disease through methods other than medication. Key aspects of this research are to examine basic mechanisms of the cell cycle (including the expression of genes during the formation of embryos) as well as specialization and differentiation into human tissue, how and when the differentiation takes place and how differentiated cells may be coaxed to differentiate into a specific type of cell. In the differentiation process, stem cells are signaled to become a specific, specialized type of cell when internal signals controlled by a cell’s genes are interspersed across long strands of DNA and carry coded instructions for all the structures and functions of a cell. In addition, cell differentiation may be caused externally by use of chemicals secreted by other cells, physical contact with neighboring cells and certain molecules in the microenvironment.

The end goal of stem cell research is to develop therapies that will allow the repair or reversal of diseases that previously were largely untreatable or incurable.. These therapies include treatment of neurological conditions such as Alzheimer’s and Parkinson’s, repair or replacement of damaged organs such as the heart or liver, the growth of implants from autologous cells, and even regeneration of lost digits or limbs.

In a developing human embryo, a specific layer of cells normally become precursor cells to cells found only in the central nervous system or the digestive system or the skin, depending on the cell layer and the elements of the embryo that direct cell differentiation. Once differentiated, many of these cells can only become one kind of cell. However, researchers have discovered that adult body cells exist that are either stem cells or can be coaxed to become stem cells that have the ability to become virtually any type of human cell, thus paving the way to engineer adult stem cell that can bring about repair or regeneration of tissues or the reversal of previously incurable diseases.

Another unique characteristic of stem cells is that they are capable of self-division and self-renewal over long periods of time. Unlike muscle, blood or nerve cells, stem cells can proliferate many times. When exposed to ideal conditions in the laboratory, a relatively small sample of stem cells can eventually yield millions of cells.

There are five primary types of stem cells: totipotent early embryonic cells (which can differentiate into any kind of human cell); pluripotent blastocyst embryonic stem cells, which are found in an embryo seven days after fertilization and can become almost any kind of cell in the body; fetal stem cells, which appear after the eighth week of development; multipotent umbilical cord stem cells, which can only differentiate into a limited number of cell types; and unspecialized adult stem cells, which exist in already developed tissue (commonly nerves, blood, skin, bone and muscle) of any person after birth.

tissue-cell-2012-2018

Source: MedMarket Diligence, LLC; Report #S520, “Tissue Engineering & Cell Therapy Worldwide 2009-2018.”

Developmental Timescales

Tissue engineering and cellular therapy products take years of research and many millions of dollars (averaging about $300 million, according to some reports) before they make it over the hurdles of clinical trials and into actual market launch. More than one small biotech company has burned through its money too quickly and been unable to attract enough investment to keep the doors open. The large pharmaceutical and medical device companies are watching development carefully, and have frequently made deals or entered into alliances with the biotechs, but they have learned to be cautious about footing the bill for development of a product that, in the end, may never sell.

For many of the products in development, product launch is likely to occur within five years. Exceptions include skin and certain bone and cartilage products, which are already on the market. Other products are likely to appear on the European market before launch in the United States, due to the presence of (so far) less stringent product review and approval laws in the European Union.

Even when the products are launched, take-up will be far from 100% of all patients with that particular condition. Initially, tissue engineering and cell therapy products will go to patients suffering from cancers and other life-threatening conditions, who, for example, are unable to wait any longer for a donor organ. Patients who seem to be near the end of their natural lives likely will not receive these treatments. Insurance coverage will certainly play a key role as well in the decision about who receives which treatments and when. But most importantly, physicians will be selecting who among their patients will be treated; the physicians learn about the treatments by using them, by observing the patient’s reactions, and by discussing their experiences with colleagues. In other words, the application of tissue engineering and cellular therapy will progress in a manner similar to the introduction of any new technology: through generally conservative usage by skilled, highly trained physicians dedicated to providing their patients with the best possible treatment without causing them additional harm.

 

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