CAMBRIDGE, Mass. -- Organogenesis Inc. is at least window-shopping for a partner to help send its prospective productsinto the marketplace.
"We're not negotiating anything," emphasized Thomas M. Tully,Organogenesis' president and chief operating officer, whenasked about the discussions. What Organogenesis has beendoing the past few months is meeting informally with asuccession of medical device companies that could play apotential role in co-development or co-marketingOrganogenesis' future products.
Urgency is not a word that could be applied to Organogenesis'search for potential partners.
Tully, who joined Organogenesis last summer from Pfizer Inc.,repeatedly describes the talks as "very preliminary." Thecompany built a business by using tissue engineeringtechnology to develop replacement skin and organs.
Starting with an artificial skin product used by drug andcosmetic companies for product testing, Organogenesis(ASE:ORG) is now working on replacement products for thehuman body.
The first such product to reach the market could be Graftskin, apotential entrant to the skin replacement field that someanalysts see growing ultimately into a $1.5 billion U.S. market.Graftskin has been granted approval to enter multicenterclinical trials as a treatment for burns. It is also in the clinic forreplacing tissue in dermatology surgery applications. If itcontinues to generate positive data, Graftskin could reach themarket around 1994 or 1995, Tully said.
The company has worked on Graftartery, a biologicalreplacement for small arteries that is manufactured from densefibrillar collagen (DFC), in a 5-year-pact with Eli Lilly & Co. It'sintended to serve as a scaffolding for regeneration of thebody's own cells. Two arterial replacements are in preclinicaltrials.
Farther in the future is a potentially safer breast implant thatcombines bovine-sourced collagen matrix and adipocytes (fatcells). The challenge is to develop a reconstructive connectivetissue filler (RCTF) that, unlike most existing collagen injectionsfor skin scars, will not require recurrent treatments. "We'reprobably a good year away" from a clinical study, Tully said.
Replacement tissue for tendons and ligaments, collagen sheetsfor surgical scarring and peripheral nerve repair are inpreclinical trials.
"All of these products except the Graftartery are not spoken foryet," Tully said. That means that Organogenesis would considerany sort of strategic relationship -- except one -- that wouldhelp move products through downstream development andinto the market.
The big exception: "It wouldn't be one where we surrenderrights to technology," Tully said. And although the companywould consider sharing product rights, Organogenesis is moreinterested in help in marketing than development.
In any event, urgency is not a word that applies toOrganogenesis' search for possible partners. "We'll hold it backuntil when -- or if -- we find a better opportunity," Tully said.
This unhurried outlook is a luxury that Tully saidOrganogenesis can afford, given its relative financial strengthand a proprietary claims to key technologies for severalpotentially large products.
"Any one of these products can result in a significant business,"Tully said. "We're not a company that's dependent on a singleproduct." Although trying to pull the whole load of productsinto the market by itself might be too much, Tully is willing totake them all further along the trail. "The more of this work wedo, the more valuable it becomes for us."
Nor does the company feel any near-term financial pinch. Afterraising about $36 million from a secondary stock offering lastNovember, the company is sitting on about $38 million in cash.Its burn rate is a manageable $5 million a year.
Organogenesis faces its most direct competition from AdvancedTissue Sciences Inc. of La Jolla, Calif., which has a dermal skinlayer replacement product, Dermagraft, in clinical trials. ATS(NASDAQ:ATISA) is also developing replacement cartilage, liverand bone marrow tissue.
BioSurface Technologies Inc., also of Cambridge, has a skinreplacement service that cultures cells obtained from apatient's skin biopsy to produce a larger area of epidermalgraft.
-- Ray Potter Senior Editor
(c) 1997 American Health Consultants. All rights reserved.