Medical Device Daily Associate
After nearly 30 years in the medical device industry with increasing levels of responsibility, it would seem almost counterintuitive for a man of Dan Pelak’s stature to leave an established company, being bought out by one of the biggest players in the business, to join a small start-up company that hasn’t even begun clinical work yet.
But that is exactly what Pelak, currently CEO of Closure Medical (Raleigh, North Carolina), is planning on doing when his duties for that company – which was acquired early last month by Johnson & Johnson (J&J; New Brunswick, New Jersey) through its Ethicon (Somerville, New Jersey) subsidiary in a deal valued at $370 million – end on Sept. 2.
Pelak has been named CEO of a little-known medical device start-up, Interventional Rhythm Management (IRM; Durham, North Carolina), which has developed what it said is a “disruptive” technology platform for cardiac rhythm management (CRM) devices using interventional technology. IRM said in a news release that Pelak would join the company on Sept. 26
According to Pelak, the reason he is leaving the proverbial “sure thing” with Closure, and its well-established new parent company J&J, to sign on with IRM, which currently has only 16 employees, is what he sees as the company’s great potential.
“This technology, once successfully commercialized, will save thousands of lives each year by offering therapy to patients who need a defibrillator but are not receiving one,” Pelak told Medical Device Daily. “It’s one of the more novel, breakthrough concepts I’ve seen and I’m just delighted to be a part of it.”
Prior to his three years at Closure, Pelak spent 26 years with Medtronic (Minneapolis). During his career there he progressed through several positions of increasing responsibility in sales and marketing and ultimately served as vice president of cardiovascular marketing.
His general management assignments spanned several divisions within Medtronic’s Neurological and Cardiovascular businesses. He held the posts of vice president and general manager of Nortech, Cardiac Surgery Technology and Perfusion Systems.
“We believe that the combination of IRM’s breakthrough technology and Dan Pelak’s ability to successfully grow early stage medical device companies will accelerate our capacity to contribute life-saving treatments to patients with abnormal heart rhythms and maximize shareholder value,” said IRM chairman William Starling in a company statement. “Dan has a proven track record as an industry leader who has grown both corporate divisions and young companies. We are very excited that we have been able to attract someone of Dan’s caliber to IRM.”
IRM was founded in 2003 and incubated by Synecor, which has offices in Durham and Menlo Park, California, to focus on the management of patients with arrhythmias, or abnormal heart rhythms.
Getting a bit more specific about the nature of the technology, but still keeping things close to the vest, Pelak said that IRM is “developing a replacement for a standard defibrillator as we know it.” He said that although “over time” the technology can be used to address patients who need standard pacemaker technology, “at the moment, the company has focused exclusively on developing a defibrillator type of product.”
The company said that analysts have estimated the worldwide CRM market, comprised of pacemakers as well as implantable and external defibrillators, to exceed $8 billion in 2005.
“The CRM business is probably the largest [of all] med-tech business,” said Pelak, adding that IRM’s technology “was really an unusual play. For a guy who has spent so many years in that industry, I was very much impressed with the technology, how far it has come in a relatively short period of time and the unusual nature of it.”
It appears that Pelak’s optimism about IRM’s potential is fairly widespread, as the company, which is still involved in preclinical work, already has raised $35.2 million through two rounds of private financing. Investors in those rounds included Delphi Ventures, Frazier Healthcare Ventures, and Johnson & Johnson Development.
Pelak emphasized that the IRM story, when fully revealed, will be very compelling. “For someone like myself to join on here I obviously had to have a lot of confidence in both the engineering staff they have as well as how far they have come in a relatively short period of time.”