By JEFFREY BERG, PhD
BB&T Contributing Editor
And JOHN BROSKY
BB&T Contributing Writer
ZURICH — Switzerland recently was host country to the second annual BioDevice Partnering conference organized by the EBD Group (Carlsbad, California/Munich, Germany) and Eucomed (Brussels), the European medical technology industry association. The program drew an audience of about 350 deal- and decision-makers from throughout the medical device industry with more than 800 prearranged one-on-one partnering meetings among the attendees, ongoing during a program of company presentations and panel discussions.
Switzerland has plenty of credentials for positioning itself as a nexus for contacts such as these since the country is pursuing a growing emphasis on advanced technology, and moving away from its long-time historical emphasis on beautiful snow-capped peaks and skiing. As one development executive in Switzerland has put it, the country is shifting “from Heidi... to hi-tech.” And among this advanced tech development is a robust emphasis on healthcare and medical science.
Big strength in med-tech
Switzerland is home to more than 500 medical technologies companies employing a full-time workforce totaling around 40,000. These companies spend about $500 million annually on R&D and export goods valued at $4.5 billion annually. The country also has Europe’s highest per-capita income and boasts one of the world’s best healthcare systems.
Switzerland’s life science industry can be defined by geographically segmenting the country according to its technical strength, which also aligns with the different languages spoken in each of these regions. The north is strong in machinery manufacturing as reflected by the location of the orthopedic companies Synthes (Solothurn) and Centerpulse (Winterthur), the latter acquired by Zimmer (Warsaw, Indiana); the northwest is the center of the country’s pharmaceutical and biotechnology industry as exemplified by the presence of Novartis and Hoffman-La Roche (both Basel); and the southwest which is best known for watchmaking, the region in which the insulin pump manufacturer, Debiotech (Lausanne), is located.
The Swiss Exchange (SWX) is the leading stock exchange in Europe for life science companies with more than one-third of total market capitalization coming from companies in the biotechnology, medical technology and pharmaceutical sectors. The performance of these companies, as reflected in the SXI Life Sciences and SXI Bio+Medtech indices, achieved over 26% growth in 2006
BioAlps (Geneva) is an association that promotes Western Switzerland in matters of life sciences, including its education and research institutions, as well as the commercial enterprises in this sector. It aims to stimulate the development of new businesses and foster the exchange of information and resources between scientists, the financial community and the government.
Its efforts at establishing collaborative relationships between industry and research institutes have enabled recent startups to raise funds. It recently launched the first BioAlps Networking Day, in partnership with Serono (Zug), a leading Swiss life science company.
ETH Zürich, the Swiss Federal Institute of Technology Zurich, ranks among the world’s leading universities with 21 Nobel prizes having been awarded to its scientists. It has people from 80 nations engaged in research, teaching, studying and working. Its facilities on the outskirts of Zurich are being expanded into a high-tech “Science City” campus.
Added value in bio/device matchups
As indicated by its name, the BioDevice Partnering Conference is focused on bringing together biological companies and scientists with companies focused on the device side of the equation, and the conference thus places heavy emphasis on the most advanced areas of new biological materials and combinations of these materials that can be used to advance device technology and improve their products via “added value features.”
“Medical devices are hot,” said Carola Schropp, managing partner with the EBD Group (San Diego) in the opening address at the conference.
“The smart money is pouring into medical device companies at the expense of past favorites like computer-related start-ups or drug-development companies,” she said.
Schropp cited an article published recently in the New York Times that says some $1.1 billion in seed money was invested in medical device companies in the first quarter of 2007, a 60% increase over the same period last year.
That number is far more significant for the med-tech sector than for biotech, she told Biomedical Business & Technology, adding that “$3 million is a big number in med-tech, where it is small change for biotech and it reflects the changed nature of product development that is coming as companies begin to move into combination products.”
The convergence of mechanical devices for the delivery of pharmaceutical therapies is heating up the dealmaking action in the med-tech sector.
Inspired by the success of drug-eluting stents (DES), executives and investors are re-examining inventories of products in both sectors to find opportunities. Oncology is the largest target on the horizon, but not all opportunities have yet been identified.
In the lead panel discussion at the conference, Tim Haines with the venture capital firm Abingworth Management (London) said biology and not pure mechanics “is going to drive developments in areas of diagnostics, therapies and the area I find the most interesting, which is monitoring the progress of disease and the progress of therapies on the patient.”
Abingworth holds some $1.25 billion in funds and has underwritten 90 life science businesses with investments up to $25 million.
Reducing timelines lowers risk
“What we like in this convergence are the opportunities to reduce timelines for product development and to reduce risk to investment,” he said. “If a drug is already proven with well-characterized molecules, then this can potentially cut the time scales to market.”
Another panelist, Crispin Simon, CEO of Biocompatibles International (Basingstoke, UK), said “Investors draw comfort that product convergence worked in DES and believe that it can work elsewhere.”
Yet he urged caution in the rush to market, saying, “where bare-metal stents were mechanically straightforward, with drug-eluting devices you are playing a card game where five of the seven cards are face down. In the case of Abbott Laboratories [Abbott Park, Illinois] and Medtronic [Minneapolis], there were thin margins of difference in the coatings applied to a stent but this decided the difference between success and failure.”
“Oncology products are calling for a drug delivery to a tumor that is 200 times greater than what is used today for DES,” he said. Chemotherapy pharmaceutics drugs are already toxic and no one yet knows the effect of using such concentrations in the close proximity to tissue that a mechanical device can deliver.
Medtronic was introduced as the one company that has the strongest hands-on experience in product combinations and Erik Baas, director of medicine and technology for international operations, agreed the industry is entering a new level of play but compared it to a three-dimensional chessboard.
He told BB&T, “A drug by itself is one thing, but combining a drug and a device is still unknown territory, and it is not trivial. There are immense opportunities in time-controlled, placement-controlled and concentration-controlled delivery of drugs, but we have only started to scratch the surface.”
Currently Medtronic generates about 20% of its revenues from combination devices that are straightforward, he said, such as wearable insulin pumps, implanted pain medication delivery devices and steroid-eluting leads.
But the idea that there will be a rush to market in oncology such as the industry saw with DES is not possible, he said, because cancer is a category containing multiple diseases and not a single indication such as a blocked artery. Each application will require a trial for each disease. Baas said he was at the partnering event to seek out ideas for “leveraging our platforms and seeking growth.”
Herbert Köntges, a co-owner of start-up Medical Device Works (Brussels, Belgium), presented a product for targeting chemotherapy for liver cancer that is nearing completion of development and is expected to begin animal testing next year.
Köntges said he was seeking a partner to complete a e3.5 million ($4.7 million) round of investment for the company, formed through a management buyout from Abbott in 2004. He also sought a pharmaceutical company interested in locking in the drug to be delivered by the company’s “kit of devices.”
The percutaneous isolated liver perfusion (PILP) device kit from Medical Device Works uses balloons to temporarily block blood flow to the liver and an expandable wire mesh system to control blood outflow to the vena cava. The liver is then infused with a drug to attack the tumor.
The device is retractable and the patient undergoes four such treatments during one year.
Köntges estimates there are some 29,000 patients in the U.S. and Europe who meet the indications for the therapy with potential annual sales of $232 million.
Time, plus plenty of trial effort
“For combination products, you need the development time and clinical trial effort,” said Schropp. “That is the point to this partnering event and many med-tech companies still have not learned the idea of partnering.”
“We are seeing strong medical and market reasons for these players with different backgrounds in med-tech, biotech and pharmaceuticals to collaborate and cooperate,” she said. “But in medical devices, they still tend to buy each other and do not always work together.”
“Partnership is going to become more critical when the nanodevice companies start to make very specific delivery devices for chemotherapies,” said Schropp. “The whole diagnostics business will evolve from simply identifying a disease to monitoring it as it progresses or the condition changes with the effects of a therapy.”
Haines said the low-hanging fruit for drug delivery by devices will go quickly and increasingly device makers will face “more sophisticated agents, more difficult molecules.”
He also cautioned company executives that progressively “in combinations of existing products the pharmaceutical companies will be driving the deals. Med-tech companies need to look closely at their competencies.”
Moving into combination products requires “a change in the mindset of device makers vs. pharmaceutical companies,” Simon added.
“For device makers the pre-clinical development stage is something you need to get done quickly to move on to the regulatory stage,” he said. “But for pharmaceutical companies the pre-clinical phase is where you must spend time and effort to identify what is right and what is wrong to reduce the risk of surprises.”
Potential combinations plentiful, varied
The products presented by the companies at the conference were striking in their variety and the variety of their potential applications either as stand-alone products or potential for combinations with other materials and systems.
The Functional Materials Laboratory in the Department of Chemistry and Applied Biosciences at ETH Zürich is pursuing applications of nanomaterials and is seeking collaborations with industry and academia. It has developed a process for the large-scale synthesis of metal nanoparticles using flame technology which is being used to fabricate bulk nanocrystalline alloys that exhibit improved mechanical properties.
It also has developed a cotton wool-like biomaterial for potential use in non-load bearing bone defects such as in dental surgery. It is synthesized by electrospinning using tricalcium phosphate nanoparticles and biodegradable poly(lactide-co-glycolide).
HeiQ Materials (Bad Zurzach), a spin-off company out of ETH Zürich, produces high-performance nanocomposite additives suited to the individual requirements of the fiber, polymer and coatings industries. The nanocomposite additives include materials incorporating silver or copper particles for antimicrobial properties, or zinc oxide particles for UV-blocking properties. The additives are easily processed into polymer-based systems such as synthetic fibers and plastic parts and can also be applied in coatings.
Kuros Biosurgery (Zurich) was founded to commercialize the research of Professor Jeffrey A. Hubbell at the Laboratory for Regenerative Medicine and Pharmacobiology
at Ecole Polytechnique Fédérale de Lausanne. Kuros is focused on developing novel injectable, in situ-forming biomaterials for the repair, support and regeneration of injured or diseased tissue. Potential applications are in dermatology, orthopedics and drug delivery. Kuros’s strategy is to take products through Phase I and II clinical trials, then license them to corporate partners for later stage clinical trials.
Kuros is investigating the combinations of fibrin from purified human plasma and an osteoconductive peptide for bone growth applications and fibrin together with a growth factor for healing chronic wounds. Both of these programs are in Phase II trials.
Kuros is also conducting preclinical studies on a hydrogel matrix prepared from synthetic biomaterials for use as a dural sealant. It can potentially also be used as a sealant in thoracic, pleural and ocular surgery. Its dural sealant program has shown favorable results in preclinical studies. The company says it expects to begin clinical trials of the dural sealant in 2008.
Also under investigation by Kuros is the combination of fibrin and a small molecule as an anti-adhesion barrier for use following abdominal/gynecological and spinal surgeries. Kuros has licensed two biological agents to Baxter (Deerfield, Illinois) for use with its Tisseel fibrin sealant.
Advancing polymeric forms
CIS Pharma (Bubendorf), a pharmaceutical research company, has developed Cellophil, a biomedical polymer platform that is based on polyacryloyl a-amino acids and has superior biocompatibility. It can be made in a linear form as well as crosslinked to create a three-dimensional structure. Cellophil is designed for optical lenses and for delivering drugs to a targeted site.
Degradable Solutions (Schlieren/Zurich) develops resorbable medical devices made from polyacrylic acid and calcium phosphates. In the dental field, it markets a product brand-named RootReplica, an exact replica of an extracted tooth root that is made chairside within five minutes and implanted to prevent atrophy of the alveolar crest. It is made from resorbable high purity granules of -tricalcium phosphate, named Calc-i-oss, that are bonded with a coating of polyacrylic acid. The same biomaterial is now sold in an injectable version under the product name Easy-graft, and is used for filling bone defects and as a support for bone regeneration.
Under contract Degradable Solutions produces resorbable devices in the field of orthopedics. Examples are SolisRs a spinal cage being sold in Europe by Stryker (Kalamazoo, Michigan), and ResorbX (Jacsonville, Florida) that is used in cranial maxillofacial surgery and is sold internationally by KLS-Martin (Tutlingen, Germany). Degradable Solutions has expanded its in-house production capabilities for its customers, including packaging and sterilization, and is recognized for its ability to develop highly challenging resorbable implants.
Anteis (Plan les Ouates) develops medical devices for aesthetic purposes and plans to introduce this year its Esthélis dermal filler for wrinkles and its Mesolis line for rejuvenating skin through rehydration. These injectable products use hyaluronic acid made by biofermentation that is crosslinked for Esthélis and non-crosslinked for Mesolis. Later this year, the company plans to introduce Fortélis Extra, a monophasic and monodensified injectable implant specifically designed to increase the volume of skin tissue. It is biocompatible and completely biodegradable.
Anteis is also developing controlled release gels for the direct injection at the treatment site of a drug that will be progressively released. With one injection, the treatment will remain active for days, reducing the required number of injections for greater patient comfort.
Epithelix (Geneva) was founded just over a year ago to develop, produce and sell high-quality human tissues reconstituted in vitro for use in studying human diseases and for toxicity testing of drugs and chemicals, thereby reducing the need for animal experimentation. MucilAir, its first commercial product, is an in vitro cell model of human respiratory epithelium which reproduces the morphology and function of the native tissue. Its one-year shelf life allows its use for studying the long-term and chronic effects of toxins, drugs and chemicals on human health. The company’s technology will be adapted to other human tissues such as the intestines, blood brain barrier and the liver.
Leman Cardiovascular (Lonay) is developing the LCD Bioprosthetic heart valve which it describes as a third generation product that combines the benefits of both stented and stentless biological heart valves. In July 2006, it acquired Hancock Jaffe Laboratories (Irvine, California) which had an ISO-certified facility for class III medical devices and 20 years of experience in biological heart valve development and manufacturing, including the processing of porcine tissue. It markets in the U.S. the ProCol vascular bioprosthesis for the creation of a bridge graft in patients requiring vascular access, and the PeriPro pericardial patch for use in cardiovascular surgery. Leman announced in January 2007 a partnership with Cook Medical (Bloomington, Indiana) relating to the use of tissue engineering and processing for minimally invasive cardiovascular indications.
Bioring (Lonay) is developing a line of biodegradable cardiovascular and urological medical devices for use in tissue repair. Its first commercial product is the Kalangos annuloplasty mitral ring for valve repair fabricated from polydioxanone and dyed with a colorant. Named after its developer, Professor A. Kalanos, who heads the Department of Cardiovascular Surgery at the University Hospital of Geneva, it has the CE mark.
Other biodegradable products Bioring is developing include coronary and intra-urethral stents, a prosthesis for female urinary incontinence, and a foramen ovale closure device.
Intelligent Medical Implants (Zug) is developing a retinal implant that is in clinical trials. It aims to provide patients with retinitis pigmentosa or age-related macular degeneration with useful visual function. The device consists of three main components: the retinal stimulator which is implanted in the eye, a visual interface, and a pocket processor. The visual interface consists of a camera, data and energy transmitters mounted on the frame of eyeglasses that is connected via a cable to the pocket processor It records visual information and transmits data and energy to the implanted retinal stimulator. The retinal implant is the first product to utilize the company’s neurostimulation technology platform which can be used to develop other learning neural prostheses or modules for active “intelligent” implantable medical devices.
Axis Biodental (Les Bois), a spinoff of Axis Dental (Lausanne), distributes dental rotary instruments. It has developed and patented dental implants having a zirconia surface to overcome the problem of metallosis caused by the release of metallic oxide particles by titanium implants. The implants will be launched this year in Switzerland and Spain. Switzerland is also home to Straumann (Basel), a leading international dental implants company and a major facility for Nobel Biocare (Glattbrugg), the world’s largest dental implants company.
Advanced materials for diagnostics
Solianis (Zurich) is developing a non-invasive continuous glucose monitor that is based. on impedance spectroscopy (IS). The technology was acquired from Pendragon Medical (Zurich) which had liquidated its operations in February 2005 due to lack of funds. Solianis has designed a multi-sensor platform around the IS-based concept, including optical sensor technology to improve the reliability of the output. Recent clinical trials performed at the University Hospital of Zurich have shown that the multi-sensor array tracks glucose changes in diabetic patients as well as healthy subjects. Further clinical trials are planned to test the effectiveness of Solianis’ technology on patients under daily life conditions.
Arrayon Biotechnology (Neuch tel) develops and markets bioanalytical platforms for in vitro diagnostics and drug development. Its core competencies are surface bioengineering and microarray based bioanalytics. Arrayon is currently selling diverse innovative microarray substrates and devices, making use of proprietary linker chemistries for covalent target (bio)molecule immobilization. Its primary markets are medical diagnostics, personal care and nutrition.
DiagnoSwiss (Monthey) develops microfluidic systems, or lab-on-a-chip devices, for improving assay accuracy on minute sample sizes, reducing response time and offering large throughput capabilities. Its platform is based on parallel channels etched into a polymer substrate using a patented plasma etching process which enables the mass production of disposable chips. Its core technology is a disposable chip which can easily be customized to a wide range of applications.
DiagnoSwiss is focused on developing ultra-rapid affinity assays (ELISAs) by combining microfluidics and electrochemistry. This results in an integrated analytical system that can meet the demand for fast and high performance analysis in low volume, while maintaining the standardized format of microtiter plates.
Medical Device Daily, sister publication of BB&T, both products of AHC Media, served as one of conference’s media sponsors.