The proosal by CMS to reduce by up to 30% the reimbursement to hospitals for cardiac devices arises from a compelling need to reduce the clearly high costs associated with these devices (stents, defibrillators, etc.). Given the size of the proposed cuts, however, and their impact on device makers and hospitals, their negative reaction (see Boston Globe) was anything but surprising. The reality is twofold: the proposal will get scaled back moderately to significantly before a final rule, likely in October, and this CMS proposal is only the first shot fired in a volley regarding device costs. As I noted in my publisher’s letter in the April MedMarkets, device manufacturers and healthcare systems alike have to recognize that the writing is on the wall.
This is preliminary(!) list of the companies involved in nanotech and/or MEMS with at least a minimum level of activity in applying the technologies to medical applications. This list was updated from a previous report by MMD, but still may included a number of companies (not yet edited out) who ultimately were unable to sustain the rampant, rabid optimism needed to drive investment in support of R&D in this area. We also will likely have a moderate to significant number of additional companies profiled.
Advanced Photonic Systems GmbH
Amersham Biosciences Corp
Anson Nano-Biotechnology Company Ltd
Aquamarijn MicroFiltration BV
Biodelivery Sciences International
Bio-Gate Bioinnovative Materials GmbH
Capsulation Nanoscience AG
Digital BioTechnology Co Lts
DIOLAS Diodenlaser GmbH
Fairfield Sensors Ltd
Flamel Technologies SA
HealPlus International Inc
ImaRx Therapeutics Inc
Improvita Health Products Inc
Insert Therapeutics Inc
JR Nanotech plc
Liplasome Pharma A/S
Magforce Applications GmbH
MicroTec Geselschafft fur Mikrotechnologie GmbH
MIV Therapeutics Inc
Nanobac Pharmaceuticals Inc
Nanocarrier Co Ltd
NanoMed Pharmaceuticals Inc
Petnet Pharmaceuticals Inc
Precision Optics Corp
Silex Microsystems AB
Starpharma Pooled Development Ltd
Tecan Group Ltd
The report is about a week away, depending on how much additional content we feel meets the “absolutely-have-to-include-this” test.
The April 2006 issue of MedMarkets updates the market for drug-eluting stents. We also review the status of the biotech industry, considering a report from Ernst & Young (Beyond Borders: The Global Biotechnology Report) and other data on this ever-optimistic industry. (BTW, I found it particularly curious that the E&Y report referred to this year as the 30th anniversary of the biotech industry — having once worked for one of the first biotechnology companies, Collaborative Research, which was founded in 1961, later named Genome Therapeutics and now known as Oscient Pharmaceutials, I guess biotech just measures time differently.)Coverage in the April MedMarkets is outlined (and will be updated) on our archives page.
Lastly, thank you for those comments received on our all-too-brief, but apparently well received, “High Growth Medical Technologies” white paper. We are considering updating and expanding it in the near future.
The most rewarding aspect of tracking medical technology markets is witnessing the innovation that emerges as entrepreneurs device solutions to healthcare problems that sometimes providers didn’t know exist (or at least couldn’t put their finger on).
We put together a small white paper looking at some of the high growth medical technologies we see for the next few years, and probably beyond.
Related Tags: Medical, Advanced Medical, Medtech, Medical Technology
The market for products worldwide in the management of diabetes is the subject of an analysis done by MMD at the end of 2005. While a plethora of studies are available on markets for diabetes-related products, our analysis succeeds uniquely by looking at both established and developing technologies with a more critical eye and doing so in a global analysis.
Worldwide Diabetes Market 2004
|Diagnostic devices||$8,000 million|
|Insulin therapy devices||$275 million|
|Insulin pumps||$1,000 million|
This $24 billion global market — big enough as it stands — represents only the tip of the potential market iceberg, for several important reasons.For the majority of Type 2 diabetes, the adult onset segment, is an undiagnosed, untreated population
- A huge pent-up demand exists for improved treatment due to the need for frequent testing (finger pricks) and insulin administrations (pen/syringe)
- A huge payer demand exists for effective treatment (read high patient compliance) that reduces the incidence of costly complications
- Advancements in diagnosis OR treatment that lead to (pick one) improved quality of life or reduced rate of complication leading to even a modest increase in the penetration of the Type 2 undiagnosed will be a huge boon to the market
So, the technologies being pursued with aggressive energy include:
- minimally invasive glucose monitors (optical coherence tomography, ultrasonic, measurement, infrared, etc.)
- closed loop pump/monitor systems (“artificial pancreas”)
- stem cells (“cure”)
It is very diffiicult to discern between those analyses of the diabetes market that are largely driven by spreadsheet formulas and those that both grind out the hard numbers and apply real insight to determine the defensible timing and impact of technology developments.
Our intention and our belief is that our hard work has produced the latter.
News came out last week (published in Lancet) on the successes achieved by well-known researcher Dr. Anthony Atala, professor at the Wake Forest Institute of Regenerative Medicine, in the development of pediatric bladders engineered from patients’ own cells.
The development of bioengineered organs, which faces many technological hurdles but also holds tremendous promise, was part of our report, Tissue Engineering, Cell Therapy and Transplantation, published in 2005. There is lengthy waiting lists for organs of all types, and even those patients who are lucky enough to receive transplanted organs are then faced with the ongoing requirement to take immunosuppressive drugs to prevent rejection.Dr. Atala envisaged the solution, but was stymied in bringing it to reality and is only now, after some 16 years of research, succeeding in being able to harvest the right patient cells, culture them ex vivo to grow from one million cells to 1.5 billion cells, apply them to a protein scaffold and reimplant them back in the patients.
Dr. Atala is on the Board of Directors for Tengion (http://www.tengion.com), a company developing the technology. From Tengion’s website:
Tengionâ€™s technology of creating a neo-organ, such as a neo-bladder, starts when a surgeon sends the patient’s biopsy to Tengion. Tengion’s scientists identify and multiply the patient’s own healthy progenitor cells, and then place these cells on a structure that is shaped like the needed organ or tissue (a bioresorbable scaffold). The resulting neo-organ becomes ready for implantation after a period of maturation. The surgeon then implants the neo-organ in the patient’s body, where it integrates with the rest of the body and becomes functional. By contrast, the current therapy for urinary bladder reconstruction, Augmentation Cystoplasty, dates from the 1890â€™s and is associated with acute and chronic risks and complications.
Organ replacements are a ripe area of development in the field of tissue engineering and cell therapy (again, see our report). The intrinsic value of bioengineering tissues/organs from the patient’s own cells is unquestioned, given the organ shortages, the need for immunosuppressants and other constrains of organ donation, as noted.What makes Dr. Atala’s success noteworthy is that tissue engineering of this type is among the most promising of medical technologies insofar as its ability to dramatically change treatment options for serious diseases. The initial tissue engineering successes were limited to less complex anatomical structures, such as skin, but has been expanded to include bone, cardiac tissue and other tissues with more complex functional and structural roles. Moreover, Dr. Atala’s work is like the “rising tide that floats all boats,” in that the process of isolating the appropriate cell types, optimizing their conditions for growth and applying them to scaffolds or matrices to form the transplantable organ structures can be replicated by researchers focused on other organ types.
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|
Am I the only one who gets frustrated when finding that most references to “technology” are limited only to discussions of computers? I know it’s a combination of the investment industry (which in this respect seems remarkably lazy) seeking to simplify the world so that it can post prognostications without using many words . . . “technology stocks are up on positive news from Microsoft.”But for the love of Thomas Edison, technology isn’t only computers! It’s bridges, medical devices, rockets, medical devices, automobiles, medical devices…
What are you going to get more excited about, a piece of hardware that can ultimately only handle or transfer information in some unique way, or a medical device that saves a life or even just dramatically improves it?
People innately don’t undestand medicine and they can’t be faulted for it. At the same time, it is inherenly in the interest of physicians to mystify the science. Instead of saying, “your child is bleeding from the lungs and we don’t know why,” they say, “your child has a confirmed diagnosis of idiopathic pediatriac pulmonary hemorrhage” as if by their multisyllabic discourse they have gotten a firm handle on the problem.
But there is good information out there, and it’s getting better just as the healthcare consumer is yearning for it. Now, I’m pretty healthcare savvy, but when people call me up and ask what I think of some obscure symptom, I suggest (after telling them to call their DOCTOR) they take a look at WebMD. As for sites that are less, consumer-oriented, I like sites like MedGadget, for the fact that the site’s authors are (apparently) a group of young MDs and that this leads them to a youthful enthusiasm for new stuff, even an appreciation of the technologies’ missteps (see Patently Silly which I came across awhile back and recently saw on MedGadget’s site) and others. If you’re in the medical product industry, however, I absolutely have to recommend my own site, MedMarket Diligence.
We’re working on finalizing this report. It shouldn’t be a surprise to anyone who has looked at the nanotech “industry” over the past couple years (we did a report three years ago) that it is the most hyped, promise-filled industry that has kept forestalling investors and any other interested parties from seeing concrete successes. Producing a report on this subject that achieves even the least resemblance to realistic timelines or realizable potential demands a diligent, critical eye to filter out the unlikely-to-ever-be-fulfilled potential.
Having said that, even the most conservative analyst would have to look at this industry and recognize that, REVENUES ASIDE, the industry is exploding with activity. The number of companies pursuing applications in nanotech and MEMS is huge. When you then distill the content down to focus only on those in the medical arena, the numbers are still huge.
There is revenue, too, and it is growing steadily toward that hockey stick upward shot that will take place, well, I’m not saying yet… We’re still applying our analysis and tracking multiple technologies approaching the launch pad.
* * *
Micro- and Nano-Medicine: Technologies, Applications, Industry, and Markets Worldwide
Â· 250 pages Â· 45 Exhibits Â· 72 Company Profiles Â· Pub. Date April 2006 Â· Report #T625
The Report will be a detailed assessment of the products and technologies under development in the nanometer scale and micrometer scale levels with clinical applications, and an assessment of the market potential for products/technologies to be successfully commercialized for use in clinical practice within a ten year forecast period. This assessment will identify the technological, market, regulatory or other hurdles to be crossed en route to commercialization. The report will provide particular emphasis in detailing the current activities and status of product development at active companies. The analysis will be directed toward revealing specific opportunities for current or hopeful competitors.
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.