The Food & Drug Administration approved Envoy Medical Corp.’s Esteem technology, the first fully implantable device to treat hearing loss in the U.S.
The FDA’s approval of Esteem provides patients with an option to alleviate their hearing loss by using a device with no readily visible external components, Dr. Jeffrey Shuren, director of the watchdog agency’s Center for Devices and Radiological Health, said in a prepared statement.
Envoy plans to start implanting 100 patients a month beginning in October at a new surgical center the company is building in Houston, which it will open in three months. The company is recruiting surgeons to train at its headquarters in White Bear Township, Minn., and a facility in Greensboro, N.C.
For Envoy, convincing physicians to embrace the new technology will be a top challenge, which is why the FDA approval is so important, CEO Patrick Spearman said in a interview.
“Once you get FDA approval, it’s just fun to talk to doctors,” he said.
Esteem also comes with hefty price tag: $30,000 out-of-pocket. But Schulman says the ultimate benefit — restoration of hearing loss — makes Esteem “a good value.”
In normal hearing, sound causes the ear drum to vibrate, moving fluid inside the cochlea, an oval-shaped area in the inner ear. The motion prompts tiny hairs to touch nerve endings, which convert the movement into electric signals sent to the brain.
In conductive hearing loss, sound moving through the outer and middle ear is blocked. Sensorineural hearing loss is more severe — the hairs don’t vibrate properly, disrupting the electric signals to the brain.
Hearing aids, which rely on microphones to amplify sound, are flawed because they don’t effectively filter unwanted noise. Patients are also self-conscious about wearing the devices.
The Esteem is located entirely in the ear. The system consists of a sensor, sound processor and driver. The sensor picks up vibrations from the ear drum and converts them into electric signals. The sound processor, a specially designed computer chip, cleans up the signals and boosts their power. Finally, the driver converts the signals back into mechanical vibrations and transmits them into the cochlea.
Spearman noted Envoy raised more than $100 million entirely from prominent angel investors, which gave the company time (15 years) to develop and perfect the technology; venture capital firms, by contrast, would have demanded a much earlier return.
Envoy’s investors include Minnesota Timberwolves owner/billionaire Glen Taylor, Roger Lucas of biotech firm Techne Corp. (NSDQ:TECH) and former Medtronic Inc. (NYSE:MDT) vice chairman Glen Nelson. Former Boston Celtic great Kevin McHale, Spearman’s brother-in-law, also chipped in $400,000.
Given the regulatory and financial pressures confronting the industry today, Spearman says it “will cost more money and take more time” to commercialize technology than start-ups think.
Aside from a roster of high-profile angels, Envoy benefited from an enormous market of people willing to pay big bucks to recover their hearing, he said.
“There’s just not a lot of [blockbuster] implantable devices out there anymore,” Spearman said.