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DIRAmed LLC., Vertebration Inc.,Ortheon Medical At Different Points On Journey To Market

8/15/2008 7:40:42 AM

Business First of Columbus -- Diramed LLC

Every employee of Diramed LLC, and most of the workers at the TechColumbus incubator where it’s housed, have literally bled for its product.

The company is trying to perfect a meter that would allow diabetics to test their blood sugar without pricking their fingers, so human guinea pigs are testing its measurements against the blood test.

Don Caudy, chief technology officer who was the company’s CEO for two years, has done as many as 10 finger sticks a day.

“Now I understand why diabetics don’t have any feeling left in their fingers,” he said.

If results from the ongoing in-house tests are promising, Diramed will launch a clinical trial for its latest prototype, aiming to get the device into hospitals by 2011. A smaller home-use product could follow two years later, Caudy said.

The federal regulatory process for a device that does not invade the body is usually a little simpler than for other medical products, but in this case the U.S. Food and Drug Administration is demanding more proof that the meter works before giving the OK. A previous scanner made by another company, which made its way to market, did not deliver accurate results and was pulled by the manufacturer, Caudy said.

“All the large (medical) companies have tried this several times, spent millions of dollars, and failed at it,” he said. “I can now comfortably say when I look at our competitors – and there are close to 40 – and look at what we’re doing, it can be done.”

Diramed is considering whether to hire a regulatory consultant, he said. The 2-year-old company brought on diagnostic industry veteran Jack Kromar as president and CEO in April as Caudy inches toward retirement.

The meter beams a laser into the subject’s finger and can read the signature of different molecules from what bounces back. That’s easier with a huge molecule like cholesterol than the tiny six-carbon glucose molecule.

Research at the Massachusetts Institute of Technology and newly developed cameras were important technology advances, Caudy said.

“We couldn’t have done what we’re doing even last year,” he said.

Vertebration Inc.

U.S. Food and Drug Administration approval was hardly the last step for a Columbus company making an implant for spinal fusion surgery that allows smaller incisions.

Vertebration Inc. won approval last summer to market its Xycor Spinal Implant, an X-shaped device that collapses to the size of the two end joints of a pinky finger for insertion between vertebrae.

The $5,200 device is an alternative to doughnut-shaped implants that are placed between the bones after removing the cartilage disk. The surgeon injects bone graft material and the two vertebrae fuse into solid bone as they heal. With the smaller implant, the incision is a tiny one through the back instead of a messy entry through the belly, and there’s room for up to 14 cubic centimeters of graft compared with 2 to 4 cubic centimeters.

FDA permission was just another step on a long pathway for a company hatched in an Ohio State University business classroom in 2004.

The company has spent the past year engineering a complex tool kit for surgeons to implant the device while promoting it with ads in trade journals and a booth at the North American Spine Society meeting in October, said Rick Karr, president and chief operating officer.

Ten or fewer surgeons will be the first trained to insert the device in late fall, and the company has nine distributors covering about 30 percent of the United States, including most of Ohio. Karr projects about 1,500 units could be sold here and abroad by the end of 2009, or about $7.8 million in sales.

“That company could be valued at $200 (million) to $300 million in a fairly short term,” said Rich Langdale, managing partner of venture capital firm NCT Ventures LLC, which has invested $600,000 in the company and houses Vertebration in its Arena District offices.

Ortheon Medical

A maturing Columbus medical device firm is working on its next product.

Founded in 1997, Ortheon Medical got clearance in 2003 for the Teno Fix Tendon Repair System. The stainless steel wire and anchor system allows repairing ruptured tendons in the hand without using weaker sutures, so it heals faster with less swelling and risk of rupture. A May 2005 study on patients in Africa, largely with machete wounds from agricultural work, found no failures with Teno Fix compared with 17 percent failure with suture repairs.

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