Medtech Startups: Stealth, Location, and Platform Tech

Medical Technology Startups Identified in the December 2006 MedMarkets (subscribers only).

In the December 2006 issue of MedMarkets, I note in my MedMarket Outlook column the common tendencies in the formation of medical technology startups in 2006. It should come as no surprise that central to many (though certainly not all) were the premises of stealth (staying under the radar), location (where are startups concentrated, as if it should be any surprise), and platform technologies, among others.

Here, for reference (or late Christmas present), are the companies identified in the December issue.

Company Principal(s) Location Product/Technology Founded
Carticept Medical, Inc. (Domain Associates, New Enterprise Associates) Alpharetta, GA Development and sales of therapeutically related medical devices 2005
Forcept, Inc. John Maroney Menlo Park, CA Assisted cautery/cutting systems for performing transvaginal hysterectomy 2005
Internal Fixation Systems, Inc. Steve Hernandez Medley, FL Orthopedic implants (e.g., bone screws) 2006
I-Therapeutix, Inc. William H. Ransone II Waltham, MA Hydrogel sealant for use in ophthalmic surgery 2006
iCardiac Technologies, Inc. Mikael Totterman, CEO Rochester, NY ECG-based cardiac diagnostics and medical devices 2006
NBI Development, Inc. Undisclosed Chicago, IL Spinal neuromodulation devices 2006
Optmed, LLC Alain Klapholz New York, NY Developing “innovative medical technologies” 2006
Safe Surgery Technologies LLC David Michelson Cheyenne, WY Capsulotomy cutting device 2006
TriReme Medical, Inc. Eitan Constantino Pleasanton, CA Apparatus and methods for delivering prostheses to luminal bifurcations 2005
Vertebral Technologies, Inc. Jeffrey Felt, CEO Minnetonka, MN Biocompatible polymers for joint restoration in the spine 2005

Carticept Medical, Inc. (Alpharetta, GA; [under construction])
Forcept, Inc. (Menlo Park, CA; no URL)
Internal Fixation Systems, Inc. (Medley, FL; no URL)
I-Therapeutix, Inc. (Waltham, MA;
iCardiac Technoloigies, Inc. (Rochester, NY;
NBI Development, Inc. (Chicago, IL; [under construction])
Optmed, LLC (New York, NY;
Safe Surgery Technologies LLC (Cheyenne, WY; no URL)
TriReme Medical, Inc. (Pleasanton, CA; no URL)
Vertebral Technologies, Inc. (Minnetonka, MA; no URL)

Tags: medtech, startups

Can We Handle the Pace of Technology Development?

(From October 2006 MedMarkets)

From time to time, when I am looking at current developments to gauge the future of medical technology markets, certain common threads seem to be seen suggesting a theme, if not a legitimate trend, encompassing them all. Each of the developments may be noteworthy on their own, but if part of an overall trend, the developments become supportive evidence.

Explosive New Technology The emergence of evidence that drug-eluting stents correlate to some significant degree with increased risk of late-stage restenosis demonstrated that the technology that suddenly produced at $5 billion market for J&J, Boston Scientific and now others (see "Drug-Eluting Stents Vie for Market Share With Innovation, Acquisitions" in this issue, page 1) was not as perfect as cardiologists (or investors) would have hoped. One might be inclined to grant a little forgiveness on the part of both manufacturers and clinicians in their zeal for the new technology, given the incontrovertible data on the restenosis associated with bare metal stents and the overwhelmingly positive short term data that drug-eluting stents dramatically reduce restenosis. But the zeal did extend beyond the direct clinical benefit of anti-restenosis. It extended to the support for a huge medical device market—encompassing angioplasty and stents—that was arguably at risk of renewed competition by coronary artery bypass grafting, which has seen device market development of its own (beating heart bypass, percutaneous technologies, even robotics) to retake the market for treatment of coronary artery disease. Neither patients seeking better outcomes, nor clinicians seeking secured caseload, nor manufacturers seeking increased revenue had particular incentive to challenge the long-term outcomes of drug-eluting stents. Those who did raise such yellow flags were not well received. Business Week Online (Science & Technology, October 9, 2006) noted the case of Dr. Renu Virmani of the cvpath Institute (Gaithersburg, MD) who, at a meeting in Paris in 2004, tried to inject a level of restraint in the enthusiasm for drug-eluting stents. She believed, based more on (what turned out to be valid) instinct than on a large body of hard clinical data, that the drugs used to prevent restenosis would in fact only delay restenosis or lead to other problems, such as clots. By all accounts, her message was not well received. Now, with the benefit of hindsight and hard clinical data, even clinicians and manufacturers are acknowledging the higher risk of blood clots associated with drug-eluting stents. However, one can’t help but feel the implicit tendency among all stakeholders to minimize the significance of this increased risk while noting, of course, that more data needs to be collected. We can go out on a relatively short limb here and assert that virtually every new technology will be overused in the short run. For medical technologies, the primary limiter is contraindication, and until a sufficient body of clinical data is produced to flesh out the contraindicated population, there will be little limitation in a new technology’s growth. The alternative is untenable, that a new technology not be approved until such volume of data is produced by numbers of cases and long term follow up to fully elucidate all the risks. The FDA, of course, would be the remaining voice for restraint, but its voice is virtually drowned out by clinicians, manufacturers and patients who clamor for the new technology.

Radically New Technology In a recent report issued by the Woodrow Wilson Center’s Project on Emerging Nanotechnologies, Michael Taylor, former deputy commissioner for policy at the FDA and now a professor at the University of Maryland, notes that the FDA is severely constrained by budget limitations such that it is wholly ill-prepared to regulate nanotechnologies. Taylor notes that, with upwards of 320 products with nanomaterials already on the market, and with over 200 drugs and medical devices incorporating nanotechnology in the pipeline, the FDA needs to be authorized by Congress to collect more safety data and perform more post-marketing surveillance. Moreover, the agency simply needs more funding to hire staff and develop expertise that is as good or better than the nanotech industry that it will be expected to police. Nanotechnology is a radically new technology or, rather, technologies. The definition of nanotechnology, framed as it is simply by the size the of products (or their components), lends itself to an incredibly diverse set of technologies (see past MedMarkets issues //Dona??//) that will exceed FDA’s abilities to address safety and efficacy. By some estimates, the U.S. government has already invested $1.3 billion in nanotechnology initiatives and private industry has added another $1.7 billion, as testament to the benefits that are expected to emerge. If, as was already noted, the FDA had limited ability to provide effective restraint in the growth of drug-eluting stents, a market for which it arguably already has adequate expertise, then what might one expect for nanotechnology? The examples of drug-eluting stents and nanotechnologies centered on limitations with the FDA in constraining the emergence of technologies to protect patients, and while regulation of medical technologies by the FDA must certainly become more effective (read, more aggressive) to accompany the aggressive development of medical technologies, the best regulation of medical technologies cannot occur without the effective management of the downside of medical technologies by manufacturers themselves. The recent history of manufacturers not taking the long view of their products (e.g., Guidant, Merck) is evidence enough for products that aren’t characterized by rapidly growing or radically new technologies. The range, types and potential impact of new technologies poised to enter the marketplace (i.e., beyond nanotechnologies) is truly breathtaking and without some level of judicious restraint applied to the pace of their introduction, the past examples of repercussions from technologies too aggressively introduced will pale in comparison. Tags: medtech, FDA, nanotechnology, stents

Startup Medtech Companies, September 2006

Startup Companies Identified in September 2006 MedMarkets

Thomas A. Schreck
Portola Valley, CA
Drug-device technology for treatment of breakthrough pain
Amaranth Medical, Inc.
Guy Heathers, Charter Life Sciences
E. Palo Alto, CA
Bioresorbable drug-eluting stents
Arbel Medical Ltd.
Didier Toubia, CEO
Yoknean, Israel
Cryosurgical ablation technology
CardioInsight Technologies, Inc
Warren Goldenberg, CEO
Cleveland, OH
Electrocardiographic imaging of the heart’s electrical activity
Minos Medical, Inc.
Bradley J. Sharp, CEO
Irvine, CA
Minimally invasive (HIFU) surgical systems for appendectomy, cholecystectomy and hysterectomy
nContact Surgical, Inc.
John P. Funkhouser, President & CEO
Morrisville, NC
Intraoperative tissue coagulation devices
OmniMedics, Inc.
Alan Cohen
Newton, MA
Cardiac device
Sirion Therapeutics, Inc.
Philippe Boulangeat, Chief Business Officer
Tampa, FL
Therapeutic ophthalmology compounds and other products

AcelRx, Inc. (Portola Valley, CA; [under construction])
Amaranth Medical, Inc. (East Palo Alto, CA; no URL)
Arbel Medical Ltd. (Yoknean, Israel; [under construction])
CardioInsight Technologies, Inc. (Cleveland, OH;
Minos Medical, Inc. (Irvine, CA;
nContact Surgical, Inc. (Morrisville, NC;
OminiMedics, Inc. (Newton, MA;
Sirion Therapeutics, Inc. (Tampa, FL;

August 2006 startup medtech companies

These are the startup companies we identified and have published in the August 2006 issue of MedMarkets.

Artisan Therapeutics, Inc. — Framingham, MA; no URL
Andrew Tehnologies, Inc. — Haddonfield, NJ; [under contruction]
Nitric BioTherapeutics, Inc. — Brisol, PA; no URl
Recovery Science, LLC — Hollywood, MD; no URL
SurgiQuest, Inc. — Fairfield, CT; no URL

Source: MedMarkets, August 2006, MedMarket Diligence, LLC

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Megatrends in Medical Technology

(June 2006 MedMarket Outlook in MedMarkets)

Megatrends in Medical Technology
Aside from other trends in the medical product industry we’ve addressed previously in MedMarket Outlook, such as the dissolution of boundaries between device and pharmaceutical technologies, the increasing integration of information and information technologies with medtech, and the rise of “holistic research” (aka “systems biology”) that recognizes the value of studying pathology with a multidisciplinary scientific approach, there are specific overarching trends and forces that are changing medical technology and the markets for them on a grand scale.

Stem Cell Research
The debate about stem cell research was no more likely to end as a result of President Bush’s restriction on federal funding as it was that the established cell lines would be sufficient or appropriate for research (they weren’t) or that the case would abate (as they have not) for the use of stem cells in the treatment of diabetes, Parkinson’s, spinal cord injury or other disease and disorders. Here, we make no ethical case for or against embryonic or somatic stem cell research — the debate is likely to become wholly moot in a matter of time — we only comment on the inevitability of the science moving forward one way or another. In June, Harvard University’s Harvard Stem Cell Institute confirmed that two projects focused on cloning to produce embryonic stem cells will move forward under private funding. The projects employ the same general type of research, somatic cell nuclear transfer, that is underway at the University of California at San Francisco and at the University of Connecticut’s Center for Regenerative Biology. Aside from these approaches, a cursory review of the state of cell research in general and stem cell research in particular will reveal that researchers have both the innovation and the willingness to pursue cell therapeutics that lead to treatments heretofore not possible. It seems fairly certain that, looking back at progress in the development of the range of cell therapies, the Bush administration’s federal funding restriction will be seen to have produced a momentary hitch rather than the obstacle it was originally portrayed as producing.

Nano- and Microscale Juggernaut Forces
There are as many different functions — maybe even more — being provided by technologies designed around nanoscale or microscale level as there are different types of these technologies. The sole criteria for technologies grouped into the nano and micro categories is size. Aside from their size, there is then little common among these technologies, which represent an incredible array of devices, molecules, materials and other products that achieve functions not possible on the macro scale, even if one only considers nano- and microscale medical applications. These range from products that are largely nanoscale materials (e.g., silver nanoparticles as antimicrobials in wound management) to those providing functions such as artificial retinas, cancer diagnostics, drug delivery and biosensors. As an industry, nanotechnology (more so than MEMS, which has found considerable realized success) has been plagued by a combination of inflated promise and underestimated technical hurdles, but while MEMS (microelectromechanical systems) has found bigger initial commercial success, nanotechnology has begun scoring commercial success that will ultimately result in markets that will eclipse MEMS products by orders of magnitude.

Open Surgery in Decline, or the Rise of the Minimally Invasive, Less Invasive, Interventional, Percutaneous and Other Alternatives to Surgery
Often stated, but never emphasized enough, is the compelling drive for treatments (that were all too recently delivered exclusively via surgery) to be associated with, or replaced by, ever-decreasing invasiveness. Device manufacturers have well established records for producing devices that not only minimize the trauma of surgery (e.g., laparoscopy) but also promise to make open surgery obsolete (e.g., percutaneous procedures like coronary anastomosis). Driving this trend is the persistent recognition that “collateral damage” in achieving clinical outcomes is unacceptable, whether from the perspective of the physician seeking to optimize results, the healthcare system seeking to minimize the costs of healthcare (or optimize revenue streams by being able to market the latest less-invasive techniques) or the patient seeking to minimize the impact of surgery on his/her busy lifestyle.

Disease State-Centered Marketplaces
Certain technologies in certain clinical areas remain the predominant if not exclusive option for treatment in those areas. However, in 2006, any legitimate competitive analysis of a market considers a multitude of different technology types. Case in point: any treatment for coronary artery disease will of necessity consider the competitive threat of bare versus eluting stents, angioplasty, atherectomy (waning but not gone), products for identification/treatment of vulnerable plaque, traditional coronary artery bypass, MIDCAB, OPCAB and other bypass variants (e.g. robotics), percutaneous bypass, atherosclerosis-reversing drugs and others. Compelling arguments must be created through the intrinsic advantages of new technologies in order to secure sought-after shelf space in the cost-fixated healthcare system armamentarium.

Materials Science Creating/Upending Markets
Underlying a stunning number of new technologies, from biodegradable/resobable stents, cellular scaffolds and a wide arrange of other implant types are the advances in materials sciences that are leading to the ability to engineer implants that now go well beyond providing solely structural roles. Driving these advances are the needs to improve upon the function of implants as static, inert devices that do not fully reflect the in situ need upon implantation, fail to adapt to changing conditions or otherwise do not provide the functions that optimize the end results of the implants’ use. Whether by impregnation with different substances or by the nature of the implant material employed, implants have improved considerably in being able to not induce an anti-inflammatory response, to provide anti-microbial function to the device, to minimize formation of blood clots and to avoid the effects like restenosis of vasculature following interventional procedures. With the need for implants frequently changing at some point after their implantation, more devices — biodegradable/bioresorbable stents, matrices/scaffolds for tissue engineering and others — are being developed that are either resorbed completely by the body or just enough to be expelled in whole or in part once their purposes have been served. Lastly, materials science and implant engineering in general have also been able to simply produce implants that are more easily deployed through tortuous twists in vessels or through narrow channels in endoscopic devices. Expectations are that more complex functions will be served by implants as a result of these trends and forces in development, from the increasing sophistication of drug delivery in various passive and active forms, to the ability of implants to respond via biofeedback to changing conditions in situ, and to providing increasingly sensor-like functions. Increasing demands are being made of the medical product marketplace — cost, competitive technologies, financial performance of public companies, etc. — but it seems clear that these demands are driving the proliferation of technologies that indeed satisfy them, sometimes with each advance creating ever greater demand in an endless progression. It also seems apparent that this “technology burst” is taking place simultaneously with the increasingly strident need for healthcare costs to get under control. The focus in the U.S. Congress on the need for Medicare reform, and reform in the U.S. healthcare system overall (up to an including the increasing drive toward universal healthcare), is gaining greater intensity and may well yield more than nominal changes to the system. The medical product industry is likely to both respond to these changes and facilitate solutions that we can scarcely imagine even now.

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Categories on medtech companies tracked

Not a great picture, I know, but this is partly due to technology limitation (mobile phone pic sent to But this is a screenshot of the one of the database data entry forms used in our internal company database, which in turn is used to track medtech companies (and other entities (e.g., VCs, providers, etc.) active in medtech. The categories include technology type (biopharm, device, pharm, biotech), major clinical applications (cardio dx, cardio tx, surgery, orthopedics, cell therapy, tissue engineering, patient monitoring, minimally invasive therapies, etc., etc.). We also segment by manufacturer, distributer, healthcare provider, etc.

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Startup Medtech Companies

These are recent startups I am reporting on in the April issue of my newsletter. As always, there’s no guarantee (or endorsement on my part) that any of these will succeed:

Principals or Investors
Bioasssessments, LLC Peter Hyde, Christopher Hyde Elkton, MD Real-time angiotensin monitor for salt sensitivity 2006
Neotract, Inc. New Enterprise Associates Palo Alto, CA Surgical urological devices 2005
NeuroLife Noninvasive Solutions Daniel McChesney, MD Pittsburgh, PA
Noninvasive device to accurately monitor brain pressure 2006

The newsletter is described here. The coverage in back issues is detailed here.

Our VC tracking URLs

These are some of the VC and other sites we track to keep an eye on new investments and new technologies in order to identify formation of new medtech companies.

Startups Redux

In my previous post, I went generous and added the startups I planned to include in our March publication. I hav subsequently realized I was being too generous, as I keep finding out that many people in the medical product industry are clamoring for new technology/ideas, but (partly because of the interest) the small medical technology companies are increasingly inclined toward stealth. SOOO, it behooves me to try to recoup the costs I have incurrent in my hard-earned effort at ferretting out these little company gems. So, I’ve published a compilation of the startups I have identified who have been founded from January 2005 to March 2006.As good readers of this blog (sigh), I will be more than happy to reward you with occasional free listings of those companies.

See the new Startup report/listing described here.

Some new startups (wink)

Normally, I would not do this (add subscription content to this blog), but I thought I would drop a list of some new companies (from my Startups table in MedMarkets that I publish every month). Here are the ones from the upcoming March issue. For reference, my goal is to find companies that have been founded in the past month (not when they say they were founded, but when their corporate filings were done — a harsher measure of how “new” they are). Sometimes I’ll go a little farther back and publish on companies who have done an exceptional job at staying in stealth mode, but who have suddenly become apparent to me. If they are new to me (I am constantly looking), then maybe my customers haven’t heard of them either.






Aragon Surgical, Inc.

Onset Ventures

Palo Alto, CA

Surgical device platform designed to reduce OR time


EpiTeK, Inc.

Jean Paul Rasschaert

Pittsburgh, PA

Minimally invasive device to prevent strokes in atrial fibrillation


i25tech, Inc.

John Dunning, President

Santa Fe, NM

Undisclosed device for treatment of a variety of diseases


Keramed, Inc.

Yichieh Shiuey

Cupertino, CA

Device for facilitating corneal transplantation


Oringen, LLC

John Krusinski, President & CEO

Tallmadge, OH

Liquid crystal sensor for bacteria and viruses


Transtimulation Research, Inc.

Jiande Chen

Oklahoma City, OK

Intestinal pacing for obesity


Aragon Surgical, LLC — Palo Alto, CA; no URL
EpiTeK, Inc. — Pittsburgh, PA; (under construction)
i25Tech, Inc. — Santa Fe, NM; (under construction)
Keramed, Inc. — Cupertino, CA; (under construction)
Oringen, LLC — Tallmadge, OH; no URL
Transtimulation Research Inc. — Oklahoma City, OK; no URL