Sequent Medical CEO Tom Wilder estimates that the global market for neuro-interventional devices is worth about $1.2 billion. But there’s an aspect of neuro-interventions, aimed at treating ischemic and hemorrhagic stroke, that sets it apart from other large medtech markets, Wilder told MassDevice.com recently.
"The United States is roughly 40% of the global market, in contrast to many other growing medical technology segments," Wilder told us. "The physicians that perform these procedures are a relatively concentrated group of skilled neurovascular specialists. The market with these physician specialists is ripe for new technologies."
Enter Sequent’s MicroBraid technology and its Web device for treating brain aneurysms. MicroBraid is a large number of ultra-fine nitinol wires, woven together to construct "very fine, precise implantable devices," Wilder said.
"We believe that we have a fundamental technology platform with the MicroBraid and the Web and that is a cornerstone of what we intend to build," he said.
But that’s not all, Wilder said, noting that Sequent has licensed the MicroBraid technology to Inceptus Medical, a medical device incubator in Orange County, Calif. Inceptus, which is run by Sequent co-founders Bob Rosenbluth and Brian Cox, is investigating the technology for cardiac implants, Wilder said.
"The MicroBraid technology and Sequent’s unique fabrication capabilities offer the opportunity to consider other medical indications," he said, noting that the MicroBraid could be used to create devices for treating patent foramen ovale and left atrial appendage closure. "We all believe that MicroBraid can play a big role in structural heart, if you look at the desire for lower-profile, low-porosity devices without necessarily having fabric in some of these procedures."
We talked with Wilder last month to find out more about Sequent Medical’s medtech pedigree and its plans for the neuro-interventional market. Following is a transcript of our chat, edited for clarity:
MassDevice.com: How does the Web technology works and sort of what makes it different from other embolization technologies for aneurysm?
Tom Wilder: Sequent was founded by 2 serial entrepreneurs, Bob Rosenbluth and Brian Cox, who previously founded MicroVention, which was sold to Terumo Corp. (TYO:4543). After they sold MicroVention to Terumo, they and 2 founding venture capital firms, U.S. Venture Partners and Versant Ventures, incubated a new startup which looked at a variety of technologies and disease states and elected to return to neurovascular with what they believed was a disruptive technology platform.
In essence that disruptive technology platform involves the Web and the core technology behind it, which is called MicroBraid. What this involves is an ability to construct very fine, precise implantable devices that are made of a large number of ultra-fine wires of varying diameters such that we can optimize a mechanical recipe for an occlusion device that’s placed into a delicate aneurysm.
You need a less-porous device to stop the blood flow into the aneurysm, with a low-enough profile so that it can go through smaller micro-catheters and render it truly a less-invasive procedure. Many of these aneurysms are irregularly shaped and the device that’s placed into an aneurysm needs to accommodate the aneurysm morphology, and not the other way around.
The Web is delivered through a micro-catheter into the aneurysm and placed across the aneurysm neck, which is the opening between the aneurysm and the artery itself.
When that low-porosity, homogeneous, smooth surface of the Web mesh, this is very fine nitinol mesh, is placed across the aneurysm neck, that low-porosity structure disrupts blood flow into the aneurysm, gradually halting blood flow. Following the procedure, after the patient is off heparin, the aneurysm begins to thrombose or clot.
This is basically the mechanism of action, which is physical and biologic, that most interventional neurovascular procedures utilize. What is different and unique about the Web is that other treatments for aneurysms do not reconstruct the aneurysm neck in a way that the Web does.
What Sequent has done is focus on an initial market entry on wide-neck bifurcation aneurysms. If you look at any book of anatomy, you’ll find that in the brain, which receives a disproportionate amount of the body’s blood flow, many of these aneurysms occur at T-junctions or bifurcations where the blood flow is splitting and diverting into smaller branches.
Many of the aneurysms that develop at these T-junctions are wide-neck and challenging, such that they’re good-size aneurysms and they have a big opening, which tends to make it more difficult to treat with embolic coils or even stenting and coiling. This is a population in which clinical outcomes have not been as good as other aneurysm segments. We elected to go after that unmet medical need population for initial proof-of-concept of the Web.
MassDevice.com: Do Web-treated patients need dual anti-platelet therapy, or are they just on the single heparin for a while?
Tom Wilder: That’s a very good question. In general, the Web is intra-saccular, like coils. It does not generally require long-term DAPT. There are a variety of procedural anti-platelet techniques but most involve just giving aspirin, as they do for coils in some cases. Because we’re treating extremely wide-neck aneurysms, some physicians may elect to prepare the patient with DAPT in case they elect to use a stent. Then take the patient off DAPT immediately following the Web procedure.
The Web is also used to treat aneurysms that have already ruptured. This is an important point. When Bob and Brian founded Sequent, they considered making an intraluminal flow diverter and were advised by some initial core physicians helping the company develop the technology to look at a technology that could be applicable to both aneurysms that have already bled, which are called ruptured aneurysms, and aneurysms which have not bled, which are referred to as elective or unruptured.
Sixty percent of the aneurysms treated today have already ruptured. That’s an important distinction for the Web, compared to some of the intraluminal stenting and intraluminal flow diverter technologies, because we do not require DAPT following the procedure. The Web can be suitable for both types of aneurysm.
MassDevice.com: You’ve launched an IDE trial here in the U.S. Where does the device stand in EU countries or countries that recognize the CE mark?
Tom Wilder: We are developing a new category of neuro-interventional treatment that’s commonly referred to as intra-saccular flow disruption. It’s an acknowledged, important, new and growing category. We’ve done so with the CE mark in Europe over time. We obtained CE mark in 2010 with an initial version of the device that was referred to as the Web DL. We commenced a number of clinical studies once we had CE Mark. We’ve also evolved the technology rapidly, having recently introduced in 2013 the Web SL or single layer line, and then in early 2014 an enhanced visualization version of the web referred to as EV, which involved a composite wire technology that makes the mesh of the Web radiographically visible, which really enhances ease of use.
In Europe, early on we commenced a controlled introduction to obtain what I would characterize as safety and probability of benefit data in both registries and clinical literature. We’ve also initiated so-called "good clinical practice" studies that are formal, monitored core lab studies.
We’ve also evolved the procedure and the technology and we have begun to sell the device to markets in Europe and have been successful at achieving very good procedural pricing, given the unmet need population. I would characterize our efforts as largely clinical in late 2010 and 2011, clinical and commencing commercialization in 2012 and moving more into a commercial mode in 2014.
We have 3 trials underway in Europe that are elective, post-CE Mark studies that we’ve decided to do and invest in to generate a good data set that’s built on top of our peer-reviewed publications. Those results were compelling in terms of effectiveness and safety in this challenging aneurysm population, and obviously we’ll have further data as we go into ’14 and ’15 from the additional trials and longer followup.
The Web has been used in about 1,000 procedures, primarily in Europe. I believe as a former Medtronic (NYSE:MDT) guy and now as sort of a hybrid device executive, we like to think that we blend the strengths that we respect in the larger companies, of process and high performance standards in terms of quality and clinical data, with agility.
One of the key challenges I find is to focus and do a few things well. We’ve really focused our efforts on a few European countries. We have begun to introduce the Web in clinical use in a number of other markets, so far in Latin America, Turkey and Australia, New Zealand. We’re also preparing to enter some other, larger geographic markets such as the United States.
Our European experience has also been very important as we start our IDE pivotal trial. As we commenced cases in August for this 140-patient trial, we had behind us clinical trial experience in Europe that we could draw upon, approximately 1,000 cases of learning curve that we could draw upon, and we had moved through a number of generations of device improvements. The relative level of clinical evidence and experience that we were bringing with this technology into the U.S. pivotal trial is significant.
MassDevice.com: Will you plan to use all your data in the ultimate submission to FDA, or will it just be the IDE data?
Tom Wilder: The FDA itself is the ultimate arbiter of what is acceptable data. We have committed to a single, pivotal trial in the United States that is Web-IT study. Of course, FDA and other regulatory agencies expect you to submit reports of prior investigations and other aggregate clinical experience. It is very helpful to be able to draw upon good, high-quality data.
That’s exactly why we invested in that level of data. We believe, to secure a long-term franchise in this space and as the device markets change, clinical data is important for regulatory purposes, but it’s also important for clinical adoption. It’s also important long-term to deal with healthcare providers.
MassDevice.com: I wanted to turn to the financing behind Sequent. You added another $20 million to the coffers recently; how much have you raised in total to date? Is that enough to carry you through to approval here in the U.S.?
Tom Wilder: We’ve been fortunate at Sequent to have the backing of 4 well-known life sciences venture firms. USVP and Versant were founding investors. Domain Assoc., which also invested in MicroVention along with the former 2, led the Series B round. And Delphi Ventures joined in Series C and was also a MicroVention investor.
I have the benefit of having VC firms that have succeeded in the neurovascular space before. We’ve raised a total of $70 million of equity to date, and based on the existing European revenue opportunity and maintenance of a focused technology center in the U.S. and broad O.U.S. commercialization, we believe that this financing is sufficient to achieve cash flow break-even.
Sequent has been fortunate to be able in this environment to attract a steady flow of venture capital. I think that makes us unique among a small class of venture capital-funded companies in the recent few years and we are very appreciative of this.
MassDevice.com: Your experience runs counter to the trend; we hear a lot from VCs and companies that between the medical device tax, the uncertain regulatory environment and economic headwinds that it’s tough going to raise money out there, and the investments tend toward later-stage companies that have taken a lot of risk out of the equation. To what do you attribute your success on the fundraising trail?
Tom Wilder: I think 1st of all we have a humble team. We thank the stars every day for our set of circumstances. We believe we have a confluence of factors, inSequent’ case: An attractive market, a group of venture firms that are familiar with the market and have succeeded before in that market, a proven founding and executive management team that has execution experience either in neurovascular or from such medical device giants as Medtronic.
The next factor is that, even though we’ve had access to capital, we are accountable to our investors. We have to be very careful and focused to ensure that every dollar spent is as optimized as possible toward building franchise value. We have run very lean on certain functions, focusing on our technology center in California, clinical data and good field support for our customers. Everything else was lean. I hired my 1st marketing executive in late 2012, which is fairly late. I hired a CFO in January.
We’ve had to operate differently because capital is so much scarcer. We are deeply appreciative of the fact that we’ve gotten it. It is tough out there. I have friends and VCs with whom I’ve kept in contact. We think that we’ve got a nice combination of factors that make us relatively more attractive.
Now that we’re selling in Europe, we’re preparing to enter the U.S. markets and we’re going to enter the others. First will be a broad, global introduction of the Web as a game-changing neurovascular treatment for aneurysms. Sequent has already developed its own set of micro-catheters to accompany the Web. We will utilize the technical, managerial and financial capabilities of Sequent to gradually enter, in an intelligent way, other segments of the neurovascular market so that we become a broader player.
We don’t seek to copy the product lines of all of our competitors. We respect the power and strength and capabilities of the larger players. We have our own place in the ecosystem.
Sequent is also considering a number of other potential, lets call it extension opportunities in other areas. I’ll just mention 1, peripheral embolization. I’ve had direct experience in that space before. We’ve been monitoring it and assessing entry opportunities and we wanted to focus and get the web done right technically before we would take some of our engineering resources and do that.
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