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.

Where will medicine be in 2035?

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, in the U.S., whether Obamacare persists (most likely) or is replaced with 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. Cancer and genomics, in particular, has been a lucrative study (see The Cancer Genome Atlas). Immunotherapy developments are also expected to be part of many oncology solutions. 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.

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.

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.

    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.

    As the human genome is the engineering plans for the human body, it is a 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 –> Case in point, the recent emergence of the gene-editing technology, CRISPR, has set the stage for practical applications to correct genetically-based 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.The development of effective drugs will have been accelerated by both modeling systems and increases in our understanding of disease and trauma, including pharmacogenomics to predict drug response. 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.

    By 2035, technologies such as these will measurably reduce 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 minimally invasive technologies (e.g., especially the NOTES technology platform). A wide range of other technologies (e.g., gamma knife, minimally invasive surgery/intervention, etc.) across multiple categories (device, biotech, pharma) will also have emerged and succeeded in the market by producing therapeutic benefit while minimizing or eliminating 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.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.

  • Personalized medicine. Perfect matches between a condition and its treatment are the goal of personalized medicine, since patient-to-patient variation can reduce the efficacy of off-the-shelf treatment. The thinking behind gender-specific joint replacement has led to custom-printed 3D implants. The use of personalized medicine will also be manifested by testing to reveal potential emerging diseases or conditions, whose symptoms may be ameliorated or prevented by intervention before onset.
  • 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.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.Other technologies being developed aggressively now will have an impact over the next twenty years, including medical/surgical robots (or even biobots), neurotechnologies to diagnose, monitor, and treat a wide range of conditions (e.g., spinal cord injury, Alzheimer’s, Parkinson’s etc.).

The breadth and depth of advances in medicine over the next 20 years will be extraordinary, since many doors have been recently opened as a result of advances in genetics, cell biology, materials science, systems biology and others — with the collective advances further stimulating both learning and new product development. 


See the 2016 report #290, “Worldwide Markets for Medical and Surgical Sealants, Glues, and Hemostats, 2015-2022.”

Medtech fundings in August 2015

Medtech fundings for August 2015 totaled $754 million, led by the $115 million IPO of Penumbra.

Below are the top fundings for the month.

COMPANY, FUNDINGPRODUCT/TECHNOLOGY
Penumbra, Inc., has filed for a $115 million initial public offeringMicro-catheter based multi-modality device for the revascularization of an occluded vessel in the brain
LDR Holding has raised $86.5 million in a round of funding according to press reportsCervical discs in spine surgery
Mevion Medical Systems, Inc., has raised $58.84 million in a round of funding according to a regulatory filingProton radiation therapy for cancer
InVivo Therapeutics Corp. has raised $50 million in equity funding from Cowan and Company according to the companyBiomaterial scaffold for treatment of spinal cord injury
ReShape Medical, Inc., has raised $38 million in a Series D round of funding according to the companyDual balloons implanted in stomach endoscopically to create satiety in treatment for obesity
Advanced Inhalation Therapies has filed an IPO valued up to $36 millionDrug delivery

For the complete list of medtech fundings in August 2015, see link.

For a historical list of the individual fundings in medtech, by month, since 2009, see link.

Medtech succeeds by responding to multiple demands

Medtech is resilient, adapting to the changing demands of patients, payers, regulators, and the economy, but only in the hands of the innovators who keep a finger in the wind on these demands.

  1. Comprehensive outcomes versus symptomatic intervention. Competition in medtech, heightened by cost pressures in particular, is characterized by the demand for comprehensive solutions to disease/trauma rather than technologies that simply ameliorate symptoms. Manufacturers are focusing on longer term solutions, competing against the full spectrum of therapeutic alternatives rather than incremental improvements in their widgets.
  2. Whatever the cost, make it lower. Cost is poorly understood in healthcare (hence the problem!), but it is recognized as important simply by the rate at which premiums increase, the percentage of GDP adding to healthcare spending, the cost of Medicare and other similar benchmarks. Cost is difficult to assess in medical technologies, because there are long term, unforeseen implications of nearly every medtech development. Nonetheless, the manufacturer who does not only bow down in homage to cost but also makes cost at least an implicit part of its value proposition will be quickly put out of business.
  3. The life spans of “gold standards” of treatment are getting shorter and shorter. Technology solutions are being developed, from different scientific disciplines, at such a pace as to quickly establish themselves, in a broad enough consensus, as new gold standards. Physicians are increasingly compelled to accept these new new standards or find their caseload shifting to those who do.
  4. Many manufacturers strive for being able to claim their products are “disruptive” — overturning existing paradigms. However, few medtech manufacturers really ever achieve anything more than marginal improvements. Note the relative amount of 510Ks versus PMAs in regulatory approvals (not that a PMA denotes a “disruptive” development).
  5. Materials technologies are defining what is a “device” as well as what they can accomplish. Competitive manufacturers are aggressively gaining a broad understanding of materials technologies to encompass traditional device, pharma, biopharma, biotech, cell biology and others, ensuring their success from a broadly competitive position.
  6. Interest in startup innovations by VCs and large-cap medtech companies has never been more intense, but funding still demands concrete milestones. Proof-of-concept gets entrepreneurs excited, but 510(K) or better is what gets the money flowing. This is not the credit-crunch of 2008, when the sour economy caused funding to largely dry up. Money is indeed flowing into medtech now, as evidenced by the IPO market and the volume of early stage funding, but potential investments — especially at very early stages — are no less intensively vetted. Startups must therefore carry the risk well into the development timeline, when the prospect of their products reaching the market has been demonstrated far more effectively.
  7. Medtech markets are influenced by many forces, but none more strongly than the drive of companies to succeed. Reimbursement. Regulatory hurdles. Healthcare reform. Cost reduction, even a 2.3% medical device excise tax, et cetera, et cetera. None of these hold sway over innovation and entrepreneurship. And the rate of innovation is accelerating, further insulating medtech against adverse policy decisions. Moreover, that innovation is reaching a sort of critical mass in which the convergence of different scientific disciplines — materials technology, cell biology, biotech, pharma and others — is leading to solutions that stand as formidable buttresses against market limiters.
  8. Information technology is having, and will have, profound effects on medical technology development. The manufacturers who “get” this will always gain an advantage. This happens in ways too numerous to mention in full, but worth noting are: drug and device modeling/testing systems, meta-analysis of clinical research, information technology embedded in implants (“smart” devices), and microprocessor-controlled biofeedback systems (e.g., glucose monitoring and insulin delivery). The information dimension of virtually every medtech innovation must be considered by manufacturers, given its potential to affect the cost/value of those innovations.

This is not a comprehensive list of drivers/limiters in medtech, but these stand behind the success or failure of many, many companies.

Patrick Driscoll is an industry analyst and publisher of content on advanced medtech markets through MedMarket Diligence.

Medical technologies at startups, June 2015

Below is a list of the technologies under development at medical technology startups identified in June 2015 and added to the Medtech Startup Database.

  • Ophthalmic surgical products
  • Devices for graft and other tissue implant delivery.
  • Biosynthetic scaffold for the management of chronic and acute wounds.
  • Ultrasound-based treatment of stroke to dissolve clots.
  • Intraocular drug delivery implant for treatment of intraocular pressure.
  • Cellulose film that prevents fibrosis forming at implant sites (e.g., breast implant)
  • Spinal implant and robot-assisted training to restore functional motor control in spinal cord injury patients.
  • Contact-lens blood glucose monitoring in diabetes.
  • Medical adhesives and delivery systems.
  • Implant for the treatment of glaucoma.
  • Stem cell technology for use in bone, cartilage, skin, muscle, vasculature and the central nervous system.
  • Low-intensity ultrasound treatment of melanoma and other cancers.

For a historical listing of medical technologies at startups since 2008, see link.

New Medical Technologies at Startups, May 2015

Below is the list of technologies under development at medical technology companies identified in May 2015 and included in the Medtech Startups Database.

  • Nanotechnology-based diagnostic
  • Bone fixation devices, including for post-sternotomy closure
  • Devices and materials for bone lengthening
  • Nanopolymer drug delivery
  • Developing an artificial pancreas; combined blood glucose monitor and insulin pump
  • Terahertz radiation-based measurement of blood glucose
  • Patient-specific orthopedic implants
  • Undisclosed medical technology
  • Novel energy delivery-based medical technology
  • Device for early detection of cardiovascular disease based on endothelial dysfunction
  • Facet joint surgical instruments
  • Neuromodulation technology
  • Electric stimulation in wound healing
  • Mesenchymal stem cell treatment in cardiology, transplantation, and autoimmunity
  • Integrated blood glucose monitor, insulin dosing
  • Surgical instrumentation

For a historical listing of technologies at medtech startups, see link.

 

Medtech Fundings in May 2015

Fundings for medical technologies in May 2015 came in at $757 million, led by the $96 million IPO of EndoChoice, Inc.

Below are the top fundings for May.

Company, fundingProduct/technology
EndoChoice, Inc., raised $96 million from a planned $115 million initial public offering according to the companyEndoscopy imaging and instruments
Glaukos Corp. has set terms for a $75 million (previously filed for $86 million) initial public offering according to a regulatory filingDevice-based treatment for glaucoma
Outset Medical, Inc., has raised $59.59 million of a planned $65.59 million round of funding according to a regulatory filingDialysis technology
Shockwave Medical, Inc., has raised $40 million in a round of funding according to the companyBalloon dilatation catheters integrated with lithotripsy for treatment of vascular and valvular lesions
Intact Vascular, Inc., has raised $38.9 million in a Series B round of funding according to the companyDevices for minimally invasive peripheral vascular procedures
Autonomic Technologies, Inc., has raised $38 million in a Series D round of funding according to the companyMicrostimulator for treatment of autonomic disorders, including severe headache
AirXpanders, Inc., has filed for a $36.5 million initial public offering according to the companyBreast tissue expander
AEGEA Medical, Inc., has raised $36 million in a Series C round of funding according to the companyConnective water vapor treatment for menorrhagia (abnormal uterine bleeding)
Ceterix Orthopedics, Inc., has secured $35 million in debt funding according to the companySurgical instruments and other products for treatment of soft tissue injuries
Moximed, Inc., has raised $33 million of a planned $37.64 million round of funding according to a regulatory filingExtra-capsular and extra-articular knee implant for treatment of osteoarthritis

For the complete list of medtech fundings in May 2015, see link.

For a historical list of the individual fundings in medtech, by month, since 2009, see link.

Medtech fundings in April 2015

Fundings for medical technologies in April 2015 reached $615 million, led by the huge $225 million funding of Intarcia Therapeutics.

Below are the top fundings for the month.

Company, fundingProduct/technology
Intarcia Therapeutics has raised $225 million in a round of funding according to the companySubcutaneous, osmotic pump for drug delivery in type 2 diabetes
Mesoblast has raised $58.5 million in a round of funding by Celgene Corp.Precursor and stem cells for cell therapy
MyoKardia, Inc., has raised $46 million in a round of funding according to a regulatory filingGenetically based treatments for cardiomyopathies
Scanadu has raised $35 million in a Series B round of funding according to press reportsDevice that enables patients to scan and upload diagnostic information
Neuronetics, Inc., has completed a $34.3 million Series F funding round, according to the companyTranscranial magnetic stimulation for the treatment of depression
Lombard Medical, Inc., has raised $26 million in financing from Oxford Finance, LLCStent grafts for treatment of abdominal aortic aneurysm
EBR Systems, Inc., has raised $20 million in a round of funding according to the companyWireless cardiac pacing

For the complete list of medtech fundings in April 2015, see link.

For a historical list of the individual fundings in medtech, by month, since 2009, see link.

Medtech fundings in March 2015

Fundings for medical technologies in March 2015 totaled $542 million, led by the $57 million funding of EndoChoice, Inc.

Below are the top fundings for the month.

Company, fundingProduct/technology
EndoChoice, Inc., has raised $57 million in a round of funding, according to the companyEndoscopes and other instrumentation in gastroenterology
Apollo Endosurgery, Inc., has closed a $50 million secured term loan according to the companyMinimally invasive endoscopic surgical products for bariatric and gastrointestinal procedures
Semma Therapeutics has raised $44 million in a Series A round of funding according to the companyCell therapy for type I diabetes
Svelte Medical Systems, Inc., has raised $38.01 million of a planned $48.74 million round of funding according to a regulatory filingDrug eluting and other coronary stents
Auxogyn, Inc., has raised $34.32 million of a planned $40 million round of funding according to a regulatory filingDiagnostic and other technologies focused on women’s reproductive health
SteadyMed Therapeutics, Inc., has raised $39.95 million in its IPO according to press reportsPatch-pump drug delivery technology
Hansen Medical, Inc., has raised $35 million in a round of funding according to a regulatory filingIntravascular robotics

For the complete list of medtech fundings in March 2015, see link.

For a historical list of the individual fundings in medtech, by month, since 2009, see link.

Medtech Financings for November Already Near $350M, Propelled by Single $210M Funding

Driven in LARGE measure by the $210 million funding of Intarcia Therapeutics, the total for medtech fundings in November is already at nearly $350 million by mid-month. Intarcia Therapeutics is developing a continuous subcutaneous delivery of drug for treatment of Type 2 diabetes (note, please, that we classify this product in “medtech” rather than “biotech” due to the fact that this is both a drug and drug-delivery).

According to the Intarcia Therapeutics:

The financings consisted of $160 million in proceeds from a preferred stock private placement and $50 million in proceeds from a private debt placement. Investors in these financings included existing investors New Enterprise Associates, Inc., New Leaf Venture Partners and Venrock, as well as new investors, The Baupost Group, LLC, Farallon Capital Management, LLC and three additional top-tier institutional investors based in Boston and New York.

Further according to the company:

ITCA 650 (continuous subcutaneous delivery of exenatide) is being developed for the treatment of type 2 diabetes. The investigational therapy employs Intarcia’s proprietary technology platform involving a matchstick-size, miniature osmotic pump that is inserted subcutaneously to provide continuous and consistent drug therapy, and the company’s proprietary formulation technology, which maintains stability of therapeutic proteins and peptides at human body temperatures for long extended periods of time.

 

Data from Intarcia’s ITCA 650 Phase 2 program have demonstrated significant and sustained reductions in HbA1c and body weight over 48 weeks of treatment with a marked reduction in the GI adverse events typically associated with the self-injection products in this class. ITCA 650 is an investigational new therapy and is not currently approved by any regulatory authority. Exenatide, the active agent in ITCA 650, is a glucagon-like peptide-1 (GLP-1) receptor agonist currently marketed globally as a twice-daily self-injection therapy for type 2 diabetes. Upon approval, ITCA 650 would represent the first injection-free GLP-1 therapy that can deliver a full year of treatment from a single placement. Intarcia’s robust intellectual property portfolio protects ITCA 650 through 2031.

The next most significant funding for the month of November thus far is transcatheter valve company, CardiAQ Valve Technologies, with a $32.5 million funding.

The complete list of November medtech fundings is being compiled at link.