A Diagnostics and Imaging Week
Biophan Technologies (West Henrietta, New York), a developer of next-generation biomedical technology, reported during a shareholder meeting its intent to initiate a new strategic business initiative by entering the field of cardiovascular therapeutic and diagnostic devices.
The company said the cardiovascular device market, which is expected to surpass $28.5 billion by 2009, includes a range of technologies that give doctors options for treating many types of cardiovascular disease, including heart failure.
Under its cardiovascular initiative, Biophan said it intends to pursue a strategy to both develop and acquire a range of devices and technologies for therapeutic and diagnostic applications. The company would market these technologies and solutions to major medical device manufacturers, as it said it has done successfully in its other strategic business initiatives.
Biophan CEO Michael Weiner said that the company, known for its MRI safety and visualization technologies, would create a separate division to develop these technologies. He believes the company will be successful in its new initiative, and he cited the company's recent licensing agreement and equity investment – worth $5 million – with Boston Scientific (Natick, Massachusetts) as a major confidence builder.
"Having done this deal with Boston Scientific and having taken on some really big challenges that the industry itself wasn't able to solve," Weiner told D&IW, "has demonstrated that Biophan is very effective at finding the most important and promising emerging biomedical technologies and developing them for critically needed applications in potential high-growth, multi-billion-dollar new markets. Biophan's business approach is to attack major needs in the biomedical industry and then to be the first to solve and patent key solutions, as well as to roll up acquisitions and licenses from third parties involved in similar pursuits."
Among the technologies the company is looking at are ventricular assist devices, designed to keep sick or injured hearts beating. Other technologies on the market or in development include emergency devices to restart stop-ped hearts, drug delivery systems, and devices to help physicians assess cardiovascular health and detect and treat potentially life-threatening conditions such as vulnerable plaque.
"Cardiovascular disease is one of the most serious health problems in the U.S., accounting for more than 40% of all deaths in this country and representing the largest single cost in healthcare," Weiner said, noting a primary reason for the attraction to this market.
Weiner said he believes his company offers a "much more attractive alternative for certain promising [medical] devices" than the more traditional venture capital route. He said his company is an organization that some of the more successful innovators in the industry "may find a bit more palatable" to the VC alternative.
"We have a lot of infrastructure that we can bring to the table [particularly] in terms of knowledge of regulatory affairs and Six Sigma practices," he said. He also noted that VC-funded projects tend to get sold "at the adolescent stage" before they have time to mature and reach their full value potential.
Weiner said the company is not planning on doing the marketing of these products that it develops, rather it plans to get a device through clinical trials and then either license or sell outright the technology to a larger company with a large sales force and established marketing outlets. He also noted that the company already has some specific technology acquisitions in mind and is not going to be in the business of taking on all comers with a new product.
"This isn't an announcement that we're shopping," he said. "We've already identified the things we like and we have already entered into negotiations that we aren't ready to talk about just yet."
The announcement was largely made for the benefit of the company's shareholders and to make institutional buyers aware of the company's new play.
While Weiner said the company is still dedicated to its MRI safety and visualization technologies, he said he wants to let Wall Street know that's not all the company is about. "What we're really about is leveraged innovation and what we're also about is alternative ways to structure arrangements between inventors and industry."
Without showing his hand, Weiner did hint that the company expects to have something to say about "one or more" of its new projects within the 2005 timeframe.
Qiagen (Venlo, the Netherlands) reported that it has agreed to acquire key assets of LumiCyte (LCI; Fremont, California) and also assets related to the bioanalytical business of SuNyx (Cologne, Germany).
LCI recently initiated marketing of the first products based on its STS (Surface Tension Segmented) Biochip sample preparation solution for MALDI mass spectrometry (MS).
SuNyx has developed and is now marketing its MPep and MProtChip platforms for sample preparation of peptide and protein samples for analysis on liquid chromatography-MALDI-MS. These products allow examining of sample preparation via nanotechnology-based surface structures.
Qiagen will pay about $3 million cash for the LumiCyte assets and additional considerations of about $4 million and $5 million after 18 and 30 months, subject to reaching certain financial targets. Still another milestone of $ 4 million could be paid after 60 months.
Qiagen said it expects the LCI buy to add about $2 million in sales and have a slightly dilutive impact of about $500,000 on its net 2006 income and be accretive thereafter.
The purchase of SuNyx's bioanalytical business expands on a previous licensing arrangement. Qiagen will pay about $800,000 in cash and potentially another $800,000 in milestones. It said the purchase would add about $1 million in net sales and will have a slightly dilutive impact of about $500,000 on 2006 net income and be accretive thereafter.
LCI has created a product portfolio that combines the separation and concentration of proteins and peptides from complex mixtures. Its approach includes using a combination of surface chemistry with nanotechnology on a single mass spectrometry sample chip so that large samples dry down through various affinity surfaces to a non-binding, molecularly flat analysis zone, resulting in an up to 1,000-fold increased sensitivity and reproducibility in MS applications.
The SuNyx platform technology enables researchers to reduce the number of pre-analytical steps and increase sensitivity by measuring each LC-fraction on a ready-made chip with pre-deposited matrix spots on ultraphobic surfaces. This enables the analysis of proteomes and, in particular, low abundant proteins.
The combination of the acquisition of key assets of LCI, plus the acquisition of the bioanalytical business of SuNyx, "creates a complete, proprietary and technology-leading portfolio for Qiagen in the rapidly growing market segment of sample preparation of proteins and peptides for analysis using MALDI mass spectrometry," the company said.
Qiagen has developed a portfolio of more than 320 consumable products for nucleic acid and protein separation, purification and handling, nucleic acid amplification, as well as automated instrumentation, synthetic nucleic acid products and related services.
Hospital products manufacturer Hospira (Lake Forest, Illinois) reported completing its purchase of Physiomet-rix (North Billerica, Massachusetts), a developer of non-invasive medical devices, for about $23 million in cash, plus repayment of about $1 million in bank debt. The acquisition was first unveiled in June.
The Physiometrix portfolio includes the PSA 4000, a real-time EEG, or brain-state monitor that aids in evaluating the effects of anesthetic agents; and the SEDLine monitor (previously known as the PSA 5000), a next-generation platform with improved ergonomic design and enhanced user-interface. Launch of the SEDLine device is targeted for this year.
John Arnott, senior vice president, global commercial operations, Hospira, said, "With the increasing importance of sedation monitoring in the hospital, Physiometrix's products will continue to be key during surgical and diagnostic procedures. We are also excited about the longer-term development potential for the technology platform."
Bio-Matrix Scientific Group (San Diego) said it has signed a letter of intent on the long-term lease of a San Diego facility formerly operated by the American Red Cross (Washington). The facility was one of seven Red Cross blood testing and research facilities nationwide.
The American Red Cross no longer occupies the facility, which a Bio-Matrix spokesperson noted is perfect for the company's stem cell banking and research operations.
The 15,000-square-foot building will house Bio-Matrix's cryogenic adult stem cell bank, aseptic cellular/tissue processing rooms, hematology, microbiology and flow cytometry laboratories, three distinct research laboratories, a tissue management/stem cell instrumentation division, and marketing and corporate offices.
Chairman David Koos said the building should be ready to operate sometime in November, adding: "That means Bio-Matrix could be revenue-positive by year-end."
Bio-Matrix Scientific Group describes itself as "a development-stage company in the business of medical devices and monitoring systems research, development and commercialization."