Medtech fundings for February 2017

Medtech fundings for February 2017 stand at $500.4 million, led by the $75 million credit facility secured by BioDelivery Sciences, the $45 million private placement by Corindus Vascular Robotics, the $41 million funding of Rhythm, Inc., the $37.2 million funding of Entellus Medical, and the $33 million funding of startup Surrozen.

Below are the top fundings for the month. For a complete list of fundings, see link.

Source: Compiled by MedMarket Diligence, LLC

For a historical listing of fundings in medtech, see link.

Factors Affecting Wound Healing

Excerpted from, “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.

A delicate physiological balance must be maintained during the healing process to ensure timely repair or regeneration of damaged tissue. Wounds may fail to heal or have a greatly increased healing time when unfavorable conditions are allowed to persist. An optimal environment must be provided to support the essential biochemical and cellular activities required for efficient wound healing and to remove or protect the wound from factors that impede the healing process.

Factors affecting wound healing may be considered in one of two categories depending on their source. Extrinsic factors impinge on the patient from the external environment, whereas intrinsic factors directly affect the performance of bodily functions through the patient’s own physiology or condition.

Preparation of the wound bed (WBP) is essential for the support of efficient and effective healing, especially when advanced wound care products are to be used. WBP involves removing localized barriers to healing, such as exudate, dead tissue or infected tissue.

Wound Bed Preparation: the TIME and DIMES acronyms

WBP involves debridement, reduction and neutralization of the bioburden and management of exudate from the wound. The TIME acronym provides a systematic way to manage wounds by looking at each stage of wound healing. The goal is to have the best, thoroughly-vascularized wound bed possible.

TIME stands for:

  • T: Tissue, non-viable or deficient.

The wound care professional should look for non-viable tissue, which includes necrotic tissue, tissue which has sloughed off, or non-viable tendon or bone.

  • I: Infection or Inflammation

Examine the wound for infection, inflammation or other signs of infection. Are there clinical signs that there may be a problem with bacterial bioburden?

  • M: Moisture Balance

Is the wound too dry, or does it have excess exudate?

What is the objective of topical therapy: absorption or drainage?

  • E: Edge of wound—non-advancing or undermined

Examine the edges of the wound. Are the edges undermined, or is the epidermis failing to migrate across the granulation tissue?

The DIMES acronym is very similar to TIME:

  • Debridement (autolytic)

For wounds with the ability to heal, adequate and repeated debridement is an important first step in removing necrotic tissue. Debridement may also help healing by removing both senescent cells that are no longer capable of normal cellular activities and biofilms that may be shielding bacterial colonies.

  • Infection/Inflammation

The level of bacterial damage may include contamination (organisms present), colonization (organisms present which may cause surface damage if critically colonized) or infection. Treatment needs to make a match between the individual patient’s wound and the appropriate product.

  • Moisture balance

Clinicians need to create a careful balance in the wound such that the environment is neither too wet nor too dry. The environment itself will change as the wound heals.

  • Edge/Environment

The clinician should carefully examine and monitor the wound edge. If the wound edge is not migrating after appropriate wound bed preparation, and if healing appears to be stalled, then more advanced wound care therapies should be considered.

  • Supportive Products and Services

There are additional products which support wound healing yet don’t fall into one of these steps. For example, proper nutritional support is important to achieving the goal of a fully healed wound.

Extrinsic Factors

Extrinsic factors affecting wound healing include:

  • Mechanical stress
  • Debris
  • Temperature
  • Desiccation and maceration
  • Infection
  • Chemical stress
  • Medications
  • Other factors such as alcohol abuse, smoking, and radiation therapy

Mechanical Stress

Mechanical stress factors include pressure, shear, and friction. Pressure can result from immobility, such as experienced by a bed- or chair-bound patient, or local pressures generated by a cast or poorly fitting shoe on a diabetic foot. When pressure is applied to an area for sufficient time and duration, blood flow to the area is compromised and healing cannot take place. Shear forces may occlude blood vessels, and disrupt or damage granulation tissue. Friction wears away newly formed epithelium or granulation tissue and may return the wound to the inflammatory phase.

Debris

Debris, such as necrotic tissue or foreign material, must be removed from the wound site in order to allow the wound to progress from the inflammatory stage to the proliferative stage of healing. Necrotic debris includes eschar and slough. The removal of necrotic tissue is called debridement and may be accomplished by mechanical, chemical, autolytic, or surgical means. Foreign material may include sutures, dressing residues, fibers shed by dressings, and foreign material which were introduced during the wounding process, such as dirt or glass.

Temperature

Temperature controls the rate of chemical and enzymatic processes occurring within the wound and the metabolism of cells and tissue engaged in the repair process. Frequent dressing changes or wound cleansing with room temperature solutions may reduce wound temperature, often requiring several hours for recovery to physiological levels. Thus, wound dressings that promote a “cooling” effect, while they may help to decrease pain, may not support wound repair.

Desiccation and Maceration

Desiccation of the wound surface removes the physiological fluids that support wound healing activity. Dry wounds are more painful, itchy, and produce scab material in an attempt to reduce fluid loss. Cell proliferation, leukocyte activity, wound contraction, and revascularization are all reduced in a dry environment. Epithelialization is drastically slowed in the presence of scab tissue that forces epithelial cells to burrow rather than freely migrate over granulation tissue. Advanced wound dressings provide protection against desiccation.

Maceration resulting from prolonged exposure to moisture may occur from incontinence, sweat accumulation, or excess exudates. Maceration can lead to enlargement of the wound, increased susceptibility to mechanical forces, and infection. Advanced wound products are designed to remove sources of moisture, manage wound exudates, and protect skin at the edges of the wound from exposure to exudates, incontinence, or perspiration.

Infection

Infection at the wound site will ensure that the healing process remains in the inflammatory phase. Pathogenic microbes in the wound compete with macrophages and fibroblasts for limited resources and may cause further necrosis in the wound bed. Serious wound infection can lead to sepsis and death. While all ulcers are considered contaminated, the diagnosis of infection is made when the wound culture demonstrates bacterial counts in excess of 105 microorganisms per gram of tissue. The clinical signs of wound infection are erythema, heat, local swelling, and pain.

Chemical Stress

Chemical stress is often applied to the wound through the use of antiseptics and cleansing agents. Routine, prolonged use of iodine, peroxide, chlorhexidine, alcohol, and acetic acid has been shown to damage cells and tissue involved in wound repair. Their use is now primarily limited to those wounds and circumstances when infection risk is high. The use of such products is rapidly discontinued in favor of using less cytotoxic agents, such as saline and nonionic surfactants.

Medication

Medication may have significant effects on the phases of wound healing. Anti-inflammatory drugs such as steroids and non-steroidal anti-inflammatory drugs may reduce the inflammatory response necessary to prepare the wound bed for granulation. Chemotherapeutic agents affect the function of normal cells as well as their target tumor tissue; their effects include reduction in the inflammatory response, suppression of protein synthesis, and inhibition of cell reproduction. Immunosuppressive drugs reduce WBC counts, reducing inflammatory activities and increasing the risk of wound infection.

Other Extrinsic Factors

Other extrinsic factors that may affect wound healing include alcohol abuse, smoking, and radiation therapy. Alcohol abuse and smoking interfere with body’s defense system, and side effects from radiation treatments include specific disruptions to the immune system, including suppression of leukocyte production that increases the risk of infection in ulcers. Radiation for treatment of cancer causes secondary complications to the skin and underlying tissue. Early signs of radiation side effects include acute inflammation, exudation, and scabbing. Later signs, which may appear four to six months after radiation, include woody, fibrous, and edematous skin. Advanced radiated skin appearances can include avascular tissue and ulcerations in the circumscribed area of the original radiation. The radiated wound may not become evident until as long as 10-20 years after the end of therapy.

Intrinsic Factors

Intrinsic factors that directly affect the performance of healing are:

  • Health status
  • Age factors
  • Body build
  • Nutritional status

Health Status

Chronic diseases, such as circulatory conditions, anemias and autoimmune diseases, influence the healing process as a result of their influence on a number of bodily functions. Illnesses that cause the most significant problems include diabetes, chronic obstructive pulmonary disease (COPD), arteriosclerosis, peripheral vascular disease (PVD), heart disease, and any conditions leading to hypotension, hypovolemia, edema, and anemia. While chronic diseases are more frequent in the elderly, wound healing will be delayed in any patient with a pre-existing underlying illness.

Chronic circulatory diseases which reduce blood flow, such as arterial or venous insufficiency, lower the amount of oxygen available for normal tissue activity and replacement. Anemias such as sickle-cell anemia result in reduced delivery of oxygen to tissues and decreased ability to support wound healing.

Normal immune function is required during the inflammatory phase by providing the WBCs (white blood cells) that orchestrate or coordinate the normal sequence of events in wound healing. Autoimmune diseases such as lupus and rheumatoid arthritis interfere with normal collagen deposition, and impair granulation.

Diabetes is associated with delayed cellular response to injury, compromised cellular function at the site of injury, defects in collagen synthesis, and reduced wound tensile strength after healing. Diabetes-related peripheral neuropathy (DPN), which reduces the ability to feel pressure or pain, contributes to a tendency to ignore pressure points and avoid pressure relief strategies.

Acquired Immune Deficiency Syndrome

Patients with acquired immunodeficiency syndrome (AIDS) have significant impact on the wound healing market as their numbers rise and their average life expectancy increases. Patients in the latter stages of the disease experience drastic reductions in mobility, activity, and nutritional status, placing them at high risk for the development of pressure ulcers. Minor scrapes or abrasions are at high risk for infection and may progress to full-thickness wounds requiring antibiotic therapy and aggressive wound management. Skin tumors, such as Kaposi’s sarcoma, lead to surgical incisions closed by secondary intention requiring the use of appropriate dressings.

The skin of AIDS patients becomes drier as the syndrome progresses. As the CD4+ T cell count falls below 400/mm3, pruritus increases and erythematous patches appear on the skin, progressing to ichthyosis and appearing as large polygonal scales, especially on the lower limbs. Histological changes include hyperkeratosis and thinning of the granular layer of the epidermis. As skin becomes more fragile, care must be exercised in the selection of tapes and adhesive dressings to avoid skin stripping and skin tears.

Age Factors

Observable changes in wound healing in the elderly include increased time to heal and the fragile structure of healed wounds. Delays are speculated to be the result of a general slowing of metabolism and structural changes in the skin of elderly people. Structural changes include a flattening of the dermal-epidermal junction that often leads to skin tears, reduced quality and quantity of collagen, reduced padding over bony prominences, and reduction in the intensity of the immune response.

Body Build

Body build can affect the delivery and availability of oxygen and nutrients at the wound site. Underweight individuals may lack the necessary energy and protein reserves to provide sufficient raw materials for proliferative wound healing. Bony prominences lack padding and become readily susceptible to pressure due to the reduced blood supply of wounds associated with bony prominences. Poor nutritional habits and reduced mobility of overweight individuals lead to increased risk of wound dehiscence, hernia formation, and infection.

Nutritional Status

Healing wounds, especially full-thickness wounds, require an adequate supply of nutrients. Wounds require calories, fats, proteins, vitamins and minerals, and adequate fluid intake. Calories provide energy for all cellular activity, and when in short supply in the diet, the body will utilize stored fat and protein. The metabolism of these stored substances causes a reduction in weight and changes in pressure distribution through reduction of adipose and muscle padding. Sufficient dietary calories maintain padding and ensure that dietary protein and fats are available for use in wound healing. In addition, adequate levels of protein are necessary for repair and replacement of tissue. Increased protein intake is particularly important for wounds where there is significant tissue loss requiring the production of large amounts of connective tissue. Protein deficiencies have been associated with poor revascularization, decreased fibroblast proliferation, reduced collagen formation, and immune system deficiencies.

Reduced availability of vitamins, minerals, and trace elements will also affect wound healing. Vitamin C is required for collagen synthesis, fibroblast functions, and the immune response. Vitamin A aids macrophage mobility and epithelialization. Vitamin B complex is necessary for the formation of antibodies and WBCs, and Vitamin B or thiamine maintains metabolic pathways that generate energy required for cell reproduction and migration during granulation and epithelialization. Iron is required for the synthesis of hemoglobin, which carries oxygen to the tissues, and copper and zinc play a role in collagen synthesis and epithelialization.

Adequate nutrition is an often-overlooked requirement for normal wound healing. Inadequate protein-calorie nutrition, even after just a few days of starvation, can impair normal wound-healing mechanisms. For healthy adults, daily nutritional requirements are approximately 1.25-1.5 g of protein per kilogram of body weight and 30-35 calories/kg.  These requirements should be increased for those with sizable wounds.

Malnutrition should be suspected in patients presenting with chronic illnesses, inadequate societal support, multisystem trauma, or GI or neurologic problems that may impair oral intake. Protein deficiency occurs in about 25% of all hospitalized patients.

Chronic malnutrition can be diagnosed by using anthropometric data to compare actual and ideal body weights and by observing low serum albumin levels. Serum prealbumin is sensitive for relatively acute malnutrition because its half-life is 2-3 days (vs 21 d for albumin). A serum prealbumin level of less than 7 g/dL suggests severe protein-calorie malnutrition.

Vitamin and mineral deficiencies also require correction. Vitamin A deficiency reduces fibronectin on the wound surface, reducing cell chemotaxis, adhesion, and tissue repair. Vitamin C is required for the hydroxylation of proline and subsequent collagen synthesis.

Vitamin E, a fat-soluble antioxidant, accumulates in cell membranes, where it protects polyunsaturated fatty acids from oxidation by free radicals, stabilizes lysosomes, and inhibits collagen synthesis. Vitamin E inhibits prostaglandin synthesis by interfering with phospholipase-A2 activity and is therefore anti-inflammatory. Vitamin E supplementation may decrease scar formation.

Zinc is a component of approximately 200 enzymes in the human body, including DNA polymerase, which is required for cell proliferation, and superoxide dismutase, which scavenges superoxide radicals produced by leukocytes during debridement.


From, “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. Available online.

Cardiovascular procedure volume growth (interventional and surgical)

Cardiovascular surgical and interventional procedures are performed to treat conditions causing inadequate blood flow and supply of oxygen and nutrients to organs and tissues of the body. These conditions include the obstruction or deformation of arterial and venous pathways, distortion in the electrical conducting and pacing activity of the heart, and impaired pumping function of the heart muscle, or some combination of circulatory, cardiac rhythm, and myocardial disorders. Specifically, these procedures are:

  • Coronary artery bypass graft (CABG) surgery;
  • Coronary angioplasty and stenting;
  • Lower extremity arterial bypass surgery;
  • Percutaneous transluminal angioplasty (PTA) with and without bare metal and drug-eluting stenting;
  • Peripheral drug-coated balloon angioplasty;
  • Peripheral atherectomy;
  • Surgical and endovascular aortic aneurysm repair;
  • Vena cava filter placement
  • Endovenous ablation;
  • Mechanical venous thrombectomy;
  • Venous angioplasty and stenting;
  • Carotid endarterectomy;
  • Carotid artery stenting;
  • Cerebral thrombectomy;
  • Cerebral aneurysm and AVM surgical clipping;
  • Cerebral aneurysm and AVM coiling & flow diversion;
  • Left Atrial Appendage closure;
  • Heart valve repair and replacement surgery;
  • Transcatheter valve repair and replacement;
  • Congenital heart defect repair;
  • Percutaneous and surgical placement of temporary and permanent mechanical cardiac support devices;
  • Pacemaker implantation;
  • Implantable cardioverter defibrillator placement;
  • Cardiac resynchronization therapy device placement;
  • Standard SVT & VT ablation; and
  • Transcatheter AFib ablation

For 2016 to 2022, the total worldwide volume of these cardiovascular procedures is forecast to expand on average by 3.7% per year to over 18.73 million corresponding surgeries and transcatheter interventions in the year 2022. The largest absolute gains can be expected in peripheral arterial interventions (thanks to explosive expansion in utilization of drug-coated balloons in all market geographies), followed by coronary revascularization (supported by continued strong growth in Chinese and Indian PCI utilization) and endovascular venous interventions (driven by grossly underserved patient caseloads within the same Chinese and Indian market geography).

Venous indications are also expected to register the fastest (5.1%) relative procedural growth, followed by peripheral revascularization (with 4.0% average annual advances) and aortic aneurysm repair (projected to show a 3.6% average annual expansion).

Source: MedMarket Diligence, LLC; “Global Dynamics of Surgical and Interventional Cardiovascular Procedures, 2015-2022,” (Report #C500).

Geographically, Asian-Pacific (APAC) market geography accounts for slightly larger share of the global CVD procedure volume than the U.S. (29.5% vs 29,3% of the total), followed by the largest Western European states (with 23.9%) and ROW geographies (with 17.3%). Because of the faster growth in all covered categories of CVD procedures, the share of APAC can be expected to increase to 33.5% of the total by the year 2022, mostly at the expense of the U.S. and Western Europe.

However, in relative per capita terms, covered APAC territories (e.g., China and India) are continuing to lag far behind developed Western states in utilization rates of therapeutic CVD interventions with roughly 1.57 procedures per million of population performed in 2015 for APAC region versus about 13.4 and 12.3 CVD interventions done per million of population in the U.S. and largest Western European countries.

Source: MedMarket Diligence, LLC; “Global Dynamics of Surgical and Interventional Cardiovascular Procedures, 2015-2022,” (Report #C500).


Global Cardiovascular Procedures report #C500 details the current and projected surgical and interventional therapeutic procedures commonly used in the management of acute and chronic conditions affecting myocardium and vascular system.

Investment in medtech and biotech: Outlook

Medtech and biotech investment is driven by an expectation of returns, but rapid advances in technology simultaneously drive excitement for their application while increasing the uncertainty in what is needed to bring those applications in the market.

MedMarket Diligence has tracked technology developments and trends in advanced medical technologies, inclusive of medical devices and the range of other technologies — in biotech, pharma, others — that impact, drive, limit, or otherwise affect markets for the management of disease and trauma. This broader perspective on new developments and a deeper understanding of their limitations is important for a couple of reasons:

  1. Healthcare systems and payers are demanding competitive cost and outcomes for specific patient populations, irrespective of technology type — it’s the endpoint that matters. This forces medical devices into de facto competition with biotech, pharma, and others.
  2. Medical devices are becoming increasingly intelligent medical devices, combining “smart” components, human-device interfaces, integration of AI in product development and products.
  3. Medical devices are rarely just “medical devices” anymore, often integrating embedded drugs, bioresorable materials, cell therapy components, etc.
  4. Many new technologies have dramatically pushed the boundaries on what medicine can potentially accomplish, from the personalized medicine enabled by genomics, these advances have served to create bigger gaps between scientific advance and commercial reality, demanding deeper understanding of the science.

The rapid pace of technology development across all these sectors and the increasing complexity of the underlying science are factors complicating the development, regulatory approval, and market introduction of advanced technologies. The unexpected size and number of the hurdles to bring these complex technologies to the market have been responsible for investment failures, such as:

  • Theranos. Investors were too ready to believe the disruptive ideas of its founder, Elizabeth Holmes. When it became clear that data did not support the technology, the value of the company plummeted.
  • Juno Therapeutics. The Seattle-based gene therapy company lost substantial share value after three patients died on a clinical trial for the company’s cell therapy treatments that were just months away from receiving regulatory approval in the US.
  • A ZS Associates study in 2016 showed that 81% of medtech companies struggle to receive an adequate return on investment

As a result, investment in biotech took a correctional hit in 2016 to deflate overblown expectations. Medtech, for its part, has seen declining investment, especially at early stages, reflecting an aversion to uncertainty in commercialization.

Below are clinical and technology areas that we see demonstrating growth and investment opportunity, but still represent challenges for executives to navigate their remaining development and commercialization obstacles:

  • Cell therapies
    • Parkinson’s disease
    • Type I diabetes
    • Arthritis
    • Burn victims
    • Cardiovascular diseases
  • Diabetes
    • Artificial pancreas
    • Non-invasive blood glucose measurement
  • Tissue engineering and regeneration
    • 3D printed organs
  • Brain-computer and other nervous system interfaces
    • Nerve-responsive prosthetics
    • Interfaces for patients with locked-in syndrome to communicate
    • Interfaces to enable (e.g., Stentrode) paralyzed patients to control devices
  • Robotics
    • Robotics in surgery (advancing, despite costs)
    • Robotic nurses
  • Optogenetics: light modulated nerve cells and neural circuits
  • Gene therapy
    • CRISPR
  • Localized drug delivery
  • Immuno-oncology
    • Further accelerated by genomics and computational approaches
    • Immune modulators, vaccines, adoptive cell therapies (e.g., CAR-T)
  • Drug development
    • Computational approaches to accelerate the evaluation of drug candidates
    • Organ-on-a-chip technologies to decrease the cost of drug testing

Impact on investment

  • Seed stage and Series A investment in med tech is down, reflecting an aversion to early stage uncertainty.
  • Acquisitions of early stage companies, by contrast, are up, reflecting acquiring companies to gain more control over the uncertainty
  • Need for critical insight and data to ensure patient outcomes at best costs
  • Costs of development, combined with uncertainty, demand that if the idea’s upside potential is only $10 million, then it’s time to find another idea
  • While better analysis of the hurdles to commercialization of advanced innovations will support investment, many medtech and biotech companies may opt instead for growth of established technologies into emerging markets, where the uncertainty is not science-based

 

Below is illustrated the fundings by category in 2015 and 2016, which showed a consistent drop from 2015 to 2016, driven by a widely acknowledged correction in biotech investment in 2016.

*For the sake of comparing other segments, the wound fundings above exclude the $1.8 billion IPO of Convatec in 2016.

Source: Compiled by MedMarket Diligence, LLC.

 

Medtech fundings in February 2017

Fundings in medical technology for the month of February stand at $148 million, led by the $37 million funding of Entellus Medical, followed by the $26 million funding of Viewray.

Below are the top fundings for the month thus far.

Source: Compiled by MedMarket Diligence, LLC.

For a complete list of fundings for the month, see link, and bookmark this post during February to see additional financings as they occur.

For a historical list of fundings, see link.

Hemostat sales growth and opportunity

Hemostats are normally used in surgical procedures only when conventional bleeding control methods are ineffective or impractical. The hemostat market offers opportunities as customers seek products that better meet their needs. Above and beyond having hemostats that are effective and reliable, additional improvements that clinicians wish to see in hemostat products include:

  • laparoscopy-friendly
  • work regardless of whether the patient is on anticoagulants or not
  • easy to prepare and store, with a long shelf life
  • antimicrobial
  • transparent so that the surgeon continues to have a clear field of view
  • non-toxic
  • preferably not made from human or animal materials.

 

Source: “Worldwide Markets for Medical and Surgical Sealants, Glues, and Hemostats, 2015-2022”; MedMarket Diligence, LLC (Report #S290).

Interventional and Surgical Cardiovascular Procedure Volumes

Cardiovascular diseases (CVDs) are a variety of acute and chronic medical conditions associated with an inability of the cardiovascular system to sustain an adequate blood flow and supply of oxygen and nutrients to organs and tissues of the body. The CVD conditions may be manifested by the obstruction or deformation of arterial and venous pathways, distortion in the electrical conducting and pacing activity of the heart, and impaired pumping function of the heart muscle, or some combination of circulatory, cardiac rhythm, and myocardial disorders.

These diseases are treated via the following surgical and interventional procedures:

  • Coronary artery bypass graft (CABG) surgery;
  • Coronary angioplasty and stenting;
  • Lower extremity arterial bypass surgery;
  • Percutaneous transluminal angioplasty (PTA) with and without bare metal and drug-eluting stenting;
  • Peripheral drug-coated balloon angioplasty;
  • Peripheral atherectomy;
  • Surgical and endovascular aortic aneurysm repair;
  • Vena cava filter placement
  • Endovenous ablation;
  • Mechanical venous thrombectomy;
  • Venous angioplasty and stenting;
  • Carotid endarterectomy;
  • Carotid artery stenting;
  • Cerebral thrombectomy;
  • Cerebral aneurysm and AVM surgical clipping;
  • Cerebral aneurysm and AVM coiling & flow diversion;
  • Left Atrial Appendage closure;
  • Heart valve repair and replacement surgery;
  • Transcatheter valve repair and replacement;
  • Congenital heart defect repair;
  • Percutaneous and surgical placement of temporary and permanent mechanical cardiac support devices;
  • Pacemaker implantation;
  • Implantable cardioverter defibrillator placement;
  • Cardiac resynchronization therapy device placement;
  • Standard SVT & VT ablation; and
  • Transcatheter AFib ablation

In 2016, the cumulative worldwide volume of these procedures is projected to approach 15.05 million surgical and transcatheter interventions. This will include:

  • roughly 4.73 million coronary revascularization procedures via CABG and PCI (or about 31.4% of the total),
  • close to 4 million percutaneous and surgical peripheral artery revascularization procedures (or 26.5% of the total);
  • about 2.12 million cardiac rhythm management procedures via implantable pulse generator placement and arrhythmia ablation (or 14.1% of the total);
  • over 1.65 million CVI, DVT, and PE targeting venous interventions (representing 11.0% of the total);
  • more than 992 thousand surgical and transcatheter heart defect repairs and valvular interventions (or 6.6% of the total);
  • close to 931 thousand acute stroke prophylaxis and treatment procedures (contributing 6.2% of the total);
  • over 374 thousand abdominal and thoracic aortic aneurysm endovascular and surgical repairs (or 2.5% of the total); and
  • almost 254 thousand placements of temporary and permanent mechanical cardiac support devices in bridge to recovery, bridge to transplant, and destination therapy indications (accounting for about 1.7% of total procedure volume).

Below is illustrated the overall global growth for each of the major categories of procedures through 2022.

Source: MedMarket Diligence, LLC; Report #C500.  (Full report available online.)

There is considerable variation in the growth of cardiovascular procedures globally, but most growth is coming out of Asia/Pacific. For example, within the area of venous interventions, the growth in the use of endovenous ablation for chronic venous insufficiency is markedly higher in Asia/Pacific than in other regions, though the U.S. will remain the largest volume of these procedures.

Source: MedMarket Diligence, LLC; Report #C500.  (Full report available online.)


“Global Dynamics of Surgical and Interventional Cardiovascular Procedures, 2015-2022” (Report #C500), published August 2016. See description, table of contents, list of exhibits at link. Available for purchase and download from link.

Forgotten Opportunities: Early Stage Biotech and Medtech Investment

Due to the uncertainty in the development, clinical testing, and regulatory approval of both biotech and medical technologies, which increasingly have to be viewed with the same competitive lens, investors have over the past few years shied away from seed stage or Series A stage company investment in favor of those nearer to market introduction. However, with the advent of a great number of new technologies and advances in the underlying science, there is enormous opportunity to identify companies and emerging sectors arising from these advances. The problem in identifying realistically promising companies is that it must be done so without falling prey to the bad investment practices in the past that ensued from a poor understanding of the technologies and their remaining commercial hurdles. Without careful consideration of remaining scientific development needed, the product’s target market, its competitors, and the sum total of the company’s capabilities to commercialize these technologies, investment in these areas will fall short of investment objectives or fail them outright.

While any of these considerations have the capacity to preempt a successful market introduction, a failure to understand the science behind the product and its remaining development hurdles to commercialization is likely to be the biggest cause of failure.

“We’ve already had one glaring example of a company, and its investors, learning the hard way that health and science advisors are important: Theranos.” (link)

Venture Capital has backed away from early stage investment

Earlier stage investment, with its higher risk, has higher potential reward, so there is a big need for more effective evaluation of potential early stage investments in order to (1) seize these opportunities that will otherwise potentially be lost with the shift to later stage fundings, (2) sort out those companies/technologies with overwhelming commercialization hurdles from those that will profitably tap an opportunity, and (3) gain the value of these opportunities before the innovation appreciates in value, driving up the price of the investment.

The Biotech Bubble

Biotech in the 1980s was enamored with companies pursuing “magic bullets” — technologies that had the potential to cure cancer or heart disease or other conditions with large, untapped or under-treated populations. With few exceptions, these all-in-one-basket efforts were only able achieve a measure of humility in the VCs who had poured volumes of money into them.

Here was evidenced a fundamental problem with biotech at a time when true scientific milestones were being reached, including successes in mapping the human genome: Landmark scientific milestones do not equate with commercial success.

As a result, money fled from biotech as few products could make it to market due to persistent development and FDA hurdles. By the late 1980s, many biotechs saw three quarters of their value disappear.

A Renewed Bubble?

The status of biomedical science and technology, with multiple synergistic developments, will lead to wild speculation and investment, potentially leading to yet another investment bubble. However, there will be advances that can point to real timelines for market introduction that will support investment.

Recent advances, developments and trends supporting emerging therapeutics

  1. Stem cells. A double-edged sword in that these do represent some the biggest therapeutics that will emerge, yet caution is advised since the mechanisms to control stem cells are not always sufficient to prevent their nasty tendency to become carcinogenic.
  2. Drug discovery models, such as using human “organoids” and other cell-based models to test or screen new drugs.
  3. Systems to accelerate the rapid evaluation of hundreds, perhaps, thousands of potential drugs before moving to animal models or preclinicals.
    1. Machine-learning algorithms
    2. Cell/tissue/organ models
    3. Meta-analysis, the practice of analyzing multiple, independently produced clinical data to draw conclusions from the broader dataset.
  4. Cross-discipline science
    1. cell biologists, immunologists, molecular biologists and others have a better understanding of pathology and therapeutics as a result of information sharing; plus BIG DATA (e.g., as part of the “Cancer Moonshot”). Thought leaders have called for collection and harnessing of patient data on a large scale and centralized for use in evaluating treatments for specific patients and cancer types.
    2. Artificial intelligence applied to diagnosis and prescribed therapeutics (e.g., IBM Watson).
    3. Examples of resulting therapies, at a minimum, include multimodal treatment – e.g., radiotherapy and immunotherapy – but more often may be represented in considerably more backend research and testing to identify and develop products with greater specificity, greater efficacy, and lowered risk of complications.
  5. Materials science developments, selected examples:
    1. Scaffolds in tissue engineering
    2. Microgels
    3. Graphene
    4. Polyhedral boranes
    5. Nanometric imprinting on fiber
    6. Knitted muscles to provide power link
    7. 3-D printed skin and more complex organs to come
    8. Orthopedic scaffolds made from electrospun nanofibers
  6. CAR-T (chimeric antigen receptor T cell therapy)
  7. CRISPR/Cas-9. Gene editing
    1. Removal, insertion of individual genes responsible for disease
    2. Potential use for creating chimeras of human and other (e.g., pig) species in order to, for example, use pigs for growing human organs for transplant.
  8. Smart devices: smart biopsy needles, surgical probes to detect cancer margins, artificial pancreas. Devices using information

 

We sum this up with these prerequisites for investment:

Prerequisites for Early Stage Med/Bio Investment

  1. A fully understood and managed gap between scientific advance and commercial reality.
    1. Investment must be tied to specific steps (prototyping, preclinicals, clinicals, physician training, etc.).
  2. A management team qualified in commercializing medtech or biotech products.
    1. CEOs (and/or Chief Medical Officers, Chief Scientific Officers) with medical science backgrounds (MD, PhD) favored over CPAs or even JDs.
  3. Reimbursement strategy pursued as something more than an afterthought
  4. Technology development in sync with end-user acceptance and training to leverage the benefits:
    1. Easier to use
    2. Fewer complications
    3. Attractive physician revenue streams
  5. Broad competitive advantage pursued:
    1. Product benefits must stand up against all competition, irrespective of technology type (devices competing with drugs, biotech).
    2. Benefits of reducing the cost of care for an existing patient population are paramount.
    3. Competitive advantage must consider the trend in technology development to avoid being disrupted by other products soon to reach the market.
  6. Predefined exit strategy; selected examples:
    1. Positioning to add innovation to a mid-cap or large-cap medtech or biotech as acquirers.
    2. Development of platform technologies for licensing or sale.
    3. IPO

 

Future investments are likely to track the historical focus on specific diseases and conditions:

Source: MedMarket Diligence, LLC and Emerging Therapeutic Company Investment and Deal Trends; Biotechnology Innovation Organization.


MedMarket Diligence, mediligence.com, tracks medical and biotechnology development to provide meaningful insights for manufacturers, investors, and other stakeholders.

High strength medical and surgical glues, growth to 2022

High strength medical and surgical glues currently command a $1.2 billion market that will grow to $1.7 billion by 2022, representing a 6.4% compound annual growth rate. More importantly, however, is that during this time frame the market will undergo steady shifts, including the regional representation, with growth slowing in western markets relative to Asia-Pacific and the rest of the world.

Below is illustrated the size versus growth of high strength glues in the U.S., Western Europe, Asia-Pacific and Rest of World.

Source: MedMarket Diligence, LLC; Report #S290. Order online.

The resulting differential growth over this period will result in a shift in the regional market balance, as shown below.

Source: MedMarket Diligence, LLC; Report #S290. Order online.

Source: MedMarket Diligence, LLC; Report #S290. Order online.

Peripheral Stenting Procedures and Markets

First introduced about two decades ago as a bailout technique for suboptimal or failed iliac angioplasty, peripheral vascular stenting gradually emerged as a valuable and versatile tool for a variety of primary and adjuvant applications outside the domain of coronary and cerebral vasculature.  Today, peripheral vascular stenting techniques are commonly employed in the management of the most prevalent occlusive circulatory disorders and other pathologies affecting the abdominal and thoracic aortic tree and lower extremity arterial bed. Stents are also increasingly used in the management of the debilitating conditions like venous outflow obstruction associated with deep venous thrombosis and chronic venous insufficiency.

Notwithstanding a relative maturity of the core technology platforms and somewhat problematic opportunities for conversion to value-adding peripheral drug-eluting systems, peripheral vascular stenting appears to have a significant room for qualitative and quantitative growth both in established and emerging peripheral indications.

Source: MedMarket Diligence, LLC; “Global Market Opportunities in Peripheral Arterial and Venous Stents, Forecast to 2020.” Report #V201. Order online.