Updated Nov. 10 to reflect five new additions, based on a recent analyst report. The new additions include: Bigfoot Biomedical, Cognoa, Enlitic, Fractyl, and Promaxo.
From time to time, medtech analysts will call out companies in the private sector that they believe investors should be keeping tabs on. Here is our ultimate list, compiled from recent analyst reports, of private medtech companies to watch.
4C Medical is developing the AltaValve, a transcatheter mitral valve replacement (TMVR) platform designed to address mitral regurgitation (MR). It is the first transcatheter mitral regurgitation (MR) therapy that directly addresses MR without replacing the native mitral valve, thus preserving the native mitral annulus and left ventricle. 4C said its device is positioned supra annular to the leaking native mitral valve to stop the leak from entering the left atrium. Its atrial-only fixation ensures minimal disruption to critical cardiac structures within the left ventricle including the chordae tendineae and the left ventricular outflow tract, the company said. 4C Medical's initial focus is to develop a therapy for MR, and subsequently for tricuspid regurgitation. While the Maple Grove, MN-based company has been fairly quiet this year, the technology is promising enough that we decided to keep 4C on this list.
7D Surgical has developed a navigation system (pictured below) that uses machine vision, eliminates the need for intraoperative radiation associated with navigation, and can reduce the navigation component of surgical procedure times by 75% to 95%. Needham & Co.'s Mike Matson noted in a report late last year that the company's total addressable market is about $2.4 billion globally. 7D hasn't let the pandemic slow it down much this year. The Toronto-based company recently completed its largest financing round to date, following its successful commercialization in the United States and its recent launch into Asia. The amount of the financing was not disclosed, but 7D said it would allow it to grow existing operations, further develop new products, and continue its expansion into international markets. 7D has also been dubbed one of Canada's fastest growing companies in 2020.
Ablative Solutions is one of several companies helping to reignite the renal denervation market. The Peregrine System Kit is comprised of an infusion catheter and dehydrated alcohol. The device is used in a minimally invasive procedure with the goal of deactivating the nerves surrounding the renal arteries and thereby reducing blood pressure. Earlier this year the Journal of the American College of Cardiology: Cardiovascular Interventions published six-month results from a European multicenter post-market study demonstrating the safety and efficacy of the company's CE-marked Peregrine System Infusion Catheter. The study evaluated additional safety and performance of the Kalamazoo, MI-based company's infusion catheter using a neurolytic agent (dehydrated alcohol) delivered into the space outside of the renal (kidney) arteries in 45 patients with systemic hypertension. Patients included in the study were taking at least three anti-hypertensive medications. At six months, mean 24-h ambulatory systolic blood pressure was reduced by 11 mm Hg, and diastolic blood pressure was reduced by 7 mm Hg. Medication adherence was monitored and remained stable throughout the study. The primary safety endpoint, defined as absence of periprocedural major vascular complications, major bleeding, acute kidney injury, or death within one month, was met in 96% of patients.
Aerin Medical is a new addition to the list. Matson highlighted the Sunnyvale, CA-based company in a report published this week, and it's easy to see why it ended up on the analyst's radar. In August, Aerin Medical closed a $48 million equity financing round and hired a new CEO. The company said it would use the proceeds from the financing to accelerate commercial growth, support new clinical studies, and develop new products to better serve ear, nose, and throat (ENT) doctors and their patients. ENT doctors use Aerin's VivAer and RhinAer platform technologies to treat patients suffering from nasal airway obstruction, and chronic rhinitis, respectively. It will be interesting to see what direction the company takes under the leadership of CEO Matt Brokaw, who has a strong track record of building ENT businesses.
Anuncia, another new addition to the list, is a spin-off of Alcyone that wants to develop devices for better treatment of hydrocephalus. The company's first product is the ReFlow ventricular system, which already has FDA clearance in the United States and a CE mark in Europe. The ReFlow system is comprised of a subcutaneous flusher component and a ventricular catheter with a membrane relief feature close to the proximal end. The device is located under the scalp, much like a cerebral spinal fluid (CSF) shunt. Ryan Zimmerman, a medtech analyst at BTIG, called attention to Anuncia in a report published in August. Zimmerman noted that he had recently caught up with the Massachusetts-based company to discuss the publication of a study by Joseph Falcone, MD, a neurological surgeon at the University of California, Irvine. "What stands out is that under conventional treatment, about half of the 69,000 patients diagnosed with hydrocephalus undergo placement of a new shunt," Zimmerman wrote, adding that historically, shunt failure has been estimated at 31.3% in the first year, 4.5% each year after that, and the rate of shunt failure in the first decade after placement is between 66% and 81%. Zimmerman noted that these statistics suggest a clear opportunity for device improvement. "While results are early and the sample size is limited, ReFlow showed improvements in differential thermal dilution, which suggests CSF flow vs. a build-up of CSF, suggesting ReFlow is working through its flushing mechanism after patients came in with symptoms of shunt occlusion," the analyst wrote, referring to Falcone's study.
Bigfoot Biomedical is a company that MD+DI readers should be quite familiar with by now. In 2017, the diabetes company was selected as the readers' choice for Medtech Company of the Year. The company is developing products to optimize insulin dosing and provide automated insulin delivery for people with insulin-requiring diabetes. The Bigfoot Unity Diabetes Management Program is expected to hit the U.S. market in 2021, assuming it secures FDA clearance. Bigfoot also has friends in high places, like Abbott Laboratories, which has led notable financing efforts for Bigfoot, even during the pandemic. Marie Thibault, a medtech analyst at BTIG and a former managing editor at MD+DI, called attention to Bigfoot in a Nov. 9 report that highlighted five private medtech companies that investors should be paying attention to. As Thibault reports, Bigfoot's first commercialized product will include proprietary insulin pen caps for basal and bolus dosing, the Abbott Libre 2 sensor platform, a connected blood glucose meter with test strips, pen needles, alcohol swabs, and a mobile app. Bigfoot Unity pen caps are designed to accommodate all U.S. major brands of long-acting and rapid-acting insulin pens, the analyst noted. The company's pipeline also includes a system specifically for insulin-requiring people on once-a-day basal therapy, and a closed-loop automated insulin delivery pump-based system.
Cala Health, another new addition to our list, got a shout out from Needham & Co.'s Matson in his Oct. 15 report. The Burlingame, CA-based company is developing the FDA-cleared Cala Trio, a wearable neuromodulation device designed to look like a watch, with the "watch face" being the stimulator and the band housing electrodes that target the patient's radial and median nerve, which send the stimulation into a ventral intermediate nucleus. Matson noted that the device serves the large and under-penetrated essential tremor market. Cala Health's domestic total addressable market is about $3 billion, according to the analyst report. Tremor and Other Hyperkinetic Movements published data in August from Cala Health's landmark PROSPECT study, which demonstrated that the Cala Trio, repeatedly used at home over three months, resulted in safe and effective hand tremor reduction and improved quality of life for adults with essential tremor.
Candesant Biomedical is also new to our list. BTIG's Thibault called attention to San Francisco, CA-based Candesant Biomedical in a Sept. 15 report. Candesant has developed the Targeted Alkali Thermolysis (TAT) platform technology for the treatment of excessive sweating. Thibault explained in her report that the TAT technology is based on the principle that alkali metal, in combination with water, generates energy. By applying a flexible, alkali metal adhesive patch to a patient's underarm (or other sweat-generating body part) for three minutes, non-invasive energy can target the source of sweat and inactivate sweat glands for up to two months, Thibault noted in her report.
Cerapedics developed the i-Factor peptide enhanced bone graft that is already FDA approved for use in cervical fusion and Cerapedics is pursuing a lumbar fusion indication. The Westminster, CO-based company doubled its sales in 2018 and continued to grow quite a bit in 2019. In May, The Spine Journal published data showing that elderly patients in Denmark treated with the i-Factor bone graft plus local bone had a statistically significantly higher fusion rate compared to allograft plus local bone. BTIG's Zimmerman noted in his Aug. 3 report that Cerapedics competes in the worldwide $5.3 billion orthobiologics segment, which grew 4% in 2019.
CardioFocus has had a productive year. In May, FDA approved the Marlborough, MA-based next-generation HeartLight X3 endoscopic ablation system for the treatment of drug refractory recurrent symptomatic paroxysmal atrial fibrillation. The first commercial procedures of the technology took place in June. FDA approval was supported by a study of 60 HeartLight X3 patients over 12 months. All study endpoints were achieved, and the device achieved very rapid pulmonary vein isolation, in as few as three minutes for a single pulmonary vein.
BTIG's Thibault highlighted Palo Alto, CA-based Cognoa in her Nov. 9 report. As MD+DI reported in September, Cognoa is seeking FDA clearance for a digital device that has the potential to diagnose autism spectrum disorder (ASD). FDA granted the company a breakthrough device designation in 2018. The firm’s digital precision health platform applies machine learning and predictive analytics to parental inputs and diagnostic data and responses to therapeutics to create more personalized care. Cognoa pushed forward with the FDA clearance submission after its technology surpassed targeted benchmarks in a pivotal study that ran from July 2019 through May 2020. The trial involved 425 participants – between the ages of 18 months and 72 months – whose caregivers or pediatricians had expressed concern about their development but who were never formally evaluated or diagnosed with autism. Thibault noted that in addition to ASD, Cognoa's pipeline includes attention-deficit/hyperactivity disorder, anxiety, and speech/language.
Conventus Orthopedics has developed a 3D cage-like fracture management system that enables minimally invasive treatment of shoulder, wrist, and elbow fractures. To fully appreciate this company's success, however, it's worth taking a look back at the year 2013. FDA cleared the company's implant for wrist fractures in January 2013, but soon after getting that first FDA clearance, Conventus ran out of money and some of its strongest financial supporters had given up on the company by then. The financial clouds began to recede, however, after Paul Buckman took over as CEO in October of that same year. In a 2013 interview, Buckman told MD+DI that investors warmed to his commercial background (as opposed to the previous CEO, who had a more technical background). He was previously president of St. Jude Medical's cardiology division and later its corporate vice president of business development, and he was able to tap into some of his business contacts to help raise money for Conventus. Currently, the company has a healthy roster of investors and is currently led by CEO Rick Epstein. In May, Conventus acquired Flower Orthopedics, a company that developed the FlowerCube system to eliminate expensive set processing during orthopedic surgery, thus enabling surgical facilities to complete back-to-back cases. In addition to a robust fixation portfolio, Flower’s continuum of care also extends into the fast-growing wound care market for both orthopedic and podiatric surgeons.
Egg Medical, also new to our list, launched a device late last year called the EggNest XR, which is designed to protect healthcare workers from scatter radiation exposure. BTIG's Thibault highlighted Egg Medical as a private medtech company to watch in her Sept. 15 report, noting that launch of the EggNest XR had been disrupted by COVID-19, but that the device had been installed at six hospitals as of August. Thibault also noted that the market opportunity for the EggNest XR consists of hospitals with cath labs, interventional radiology labs, and hybrid operating rooms. Here is an introductory video, courtesy of the Arden Hills, MN-based company.
Endotronix is developing an integrated platform to provide comprehensive, reimbursable health management tools for patients suffering from chronic heart failure. The company’s comprehensive solution includes a cloud-based disease management data system and outpatient hemodynamic management with a breakthrough implantable wireless pulmonary artery sensor for early detection of worsening heart failure. The Lisle, IL-based company raised $45 million in a series D round that closed in September 2018, but expanded the financing in 2019 by an additional $35 million. The company is using the proceeds from the financing for a more robust clinical trial to nab FDA approval and National Coverage Determination for the Cordella Pulmonary Artery Sensor. That trial began enrolling patients in February.
Another company added based on Thibault's Nov. 9 report, Enlitic is developing a clinical artificial intelligence platform focused on radiology. The analyst noted that among the deep learning solution's features is the ability to triage scans and detect anomalies, allowing radiologists to diagnose more quickly and accurately. In September, Enlitic received an award from the U.S. Defense Innovation Unit that enables a two-year pilot of its AI platform at select Defense Health Agency and Veterans Affairs medical facilities. The pilot will include training for clinicians and staff, an assessment of how the software affects the efficiency and accuracy of diagnosis, and use of secure anonymized data to help develop AI algorithms. This pilot may eventually lead to an expansion of Enlitic’s technology throughout the Department of Defense, according to Thibault's report.
While a new addition to this list, thanks to Thibault's Nov. 9 report, Fractyl is no stranger to MD+DI. The company is developing a minimally invasive procedure (Revita DMR) for a variety of metabolic conditions, including Type 2 diabetes, polycystic ovarian syndrome, nonalcoholic fatty liver disease, and nonalcoholic steatohepatitis. In June, FDA approved the company's pivotal trial. The primary endpoint of the study will be the percentage of patients who are able to achieve target glycemic control (HbA1c less than or equal to 7%) without the need for insulin at 24 weeks post procedure, comparing Revita DMR to the sham arm. Secondary endpoints will assess the impact of Revita DMR on additional glycemic, hepatic, and cardiovascular endpoints. In August, Fractyl reported that it had raised $55 million in a series E round to support the pivotal trial of Revita DMR (duodenal mucosal resurfacing).
Mainstay Medical, another new addition to our list of private medtech companies to watch, recently received FDA approval for its ReActiv8 neuromodulation system for chronic lower back pain. According to Needham & Co.'s Matson, one of the primary differentiating feature relative to traditional spinal cord stimulation systems is that the ReActiv8 is designed to stimulate the multifidus muscle in order to restore bodily control and stability in the lower back region. The analyst noted that Mainstay expects to launch the system in the UK and Australia sometime this year and expects to move into a full launch in the United States next spring.
MedRhythms, a Portland, ME-based medtech company, is developing direct stimulation prescription digital therapeutics. According to Thibault's report, MedRhythms' technology combines prescribed music, software, and sensors with the aim of improving walking and cognition. The company's current pipeline targets mobility improvements in neurology, including chronic stroke, multiple sclerosis, Parkinson's disease, Alzheimer's disease, and fall prevention in aging populations.
NeuroPace has developed a neuromodulation system for treating epilepsy that, according to Matson, is differentiated from other medical technologies used to treat epilepsy in that stimulation is only given if the system detects a seizure. The Responsive NeuroStimulation (RNS) system consists of a device placed in the patient's skull with leads threaded to targeted areas of the brain. The analyst noted that the RNS system is the only neuromodulation device that offers personalized stimulation treatment based on the patient's seizure patterns and provides continuous EEG monitoring and patient diagnostics that are remotely viewable by the physician. This data provides an objective measure of seizure burden over time, Matson explained, and can assist in the care of the patient. As MD+DI previously reported, the Mountain View, CA-based company raised $67 million in August to support commercial expansion of the RNS system. The company also won MRI labeling from FDA earlier this year.
Paragonix Technologies is new to MD+DI's list, but was mentioned by both Matson and Thibault as a private medtech company to keep tabs on. Paragonix has developed the SherpaPak technology platform, which incorporates precision cooling technology to advance organ preservation and transportation. The company has won regulatory clearances in the United States and Europe for all solid organs. The company's first product, the SherpaPak Cardiac Transport System (CTS), is designed to protect heart transplants from physical and thermal trauma in a dual-canister compartment. This is important, Matson noted, because thermal deviations beyond a certain temperature range can result in organ damage. He also noted that competing technologies, such as warm perfusion, have yet to win FDA approval and require more resources, including up to three times the medical staff during organ recovery runs. BTIG's Thibault wrote in her report that about 25% of leading U.S. heart centers are using the Paragonix CTS and that peer-to-peer references are accelerating adoption of the technology. She also pointed to a growing body of clinical and economic evidence supporting the use of the technology, based on reduction of graft-dysfunction-related complications. Paragonix also has a system for donor lung preservation, and a SherpaPak Pancreas Transport System.
Oakland, CA-based Promaxo, the final new addition to this list based on analyst Thibault's Nov. 9 report, has developed an office-based MRI system that has a much smaller footprint yet provides high image quality for guidance. Thibault notes that once the FDA clears the system, Promaxo will initially focus on urology applications, including guided needle biopsy for prostate cancer.
Quantum Surgical is a Montpellier, France-based company that, Thibault noted, was started by the founder and top management of Medtech SA, which Zimmer Biomet acquired in 2016. Quantum has developed a platform that combines robotics, advanced image processing software, and artificial intelligence to treat liver cancer. The medtech analyst wrote that the first-in-human procedure with the Quantum Surgical platform was performed on a patient with a primary liver tumor in June at Montpellier University Hospital in France. The system was also used in July to treat a patient with liver metastases. Thibault reported that these patients were part of an ongoing 20-patient trial that is expected to support a CE mark.
Simplify Medical has developed a low-profile cervical disc replacement implant that incorporates two PEEK endplates that have a titanium plasma spray on the exterior sides for porosity and a ceramic core for mobility. The Sunnyvale, CA-based company reported FDA approval in September for one-level procedures. Matson noted in his recent report that FDA approval for two-level procedures is expected sometime in the first half of 2021. The medtech analyst said the company is currently in the process of expanding its commercial team and securing agreements with hospitals and ambulatory surgery centers. "Management has noted that it has distributors lined up too," Matson said.