Seven years ago, Dr. Eugene de Juan Jr. started developing a tiny coil device, roughly half the size of an aspirin, that is screwed into the eye. The coil is coated with medication and used to treat especially difficult eye disease.
That and other inventions by de Juan, a graduate of the University of South Alabama medical school, spawned the formation of a Mobile-based company that's developing cutting-edge treatments for conditions that lead to vision loss and blindness.
The business, InnoRx, is flush with a $3.5 million investment from a Minnesota company and is set to begin human trials later this year on its helical coil.
InnoRx is developing several products for diseases that affect the retina, an area of the eye for which limited treatment options are available.
"This is a company that is taking an aggressive approach to back-of-the-eye disease," said Dr. Eliot Lazar, a Buffalo, N.Y., opthamologist [sic] who analyzes medical devices and technologies for banks, investment firms and other organizations.
InnoRx referred the Mobile Register to Lazar, who said he has studied the company but has no financial stake in it. Lazar called InnoRx a "young, fresh company" that will "provide enormous value to patients and doctors."
De Juan, who founded InnoRx in 1999, is chief executive officer of the Doheny Retina Institute, which is affiliated with the University of Southern California.
InnoRx is a family affair: The business initially was funded by family members, who still control the majority interest, and Michael Chambers, de Juan's brother-in-law, serves as president and chief executive officer and operates the company from Mobile.
"I think they will revolutionize the market," said Bruce Barclay, president of SurModics, the Minnesota company that invested in InnoRx.
InnoRx is focusing its efforts on treating age-related macular degeneration and diabetic retinopathy, which together affect more than 15 million people nationwide, according to medical organizations.
The former occurs when the macula -- the area in the retina at the back of the eye which allows people to see fine detail clearly -- deteriorates, according to the American Academy of Opthamology [sic].
Diabetic retinopathy, caused when high blood-sugar levels damage blood vessels in the retina, is the most common diabetic eye disease, affecting between 40 and 45 percent of those with diagnosed diabetes, the National Eye Institute reports.
Both conditions affect the back of the eye, an area difficult to reach with medication, de Juan said. Eye drops often are washed away before they reach the retina.
Emerging treatments include implantable devices, but those differ from the helical coil because they either require surgery and stitches or do not deliver medication for as long a period.
Other methods involve injecting medication into the eye every four or six weeks. Neither the implantable devices nor the injections have been approved by the federal Food and Drug Administration, Lazar said.
By comparison, according to InnoRx, the helical coil offers several "competitive advantages:" delivery of medication for over a year, elimination of the need for multiple injections, lower risk of toxicity and ability to remove the device if necessary.
De Juan said other systems are much more invasive and thus carry more risk, take longer and cost more.
InnoRx's 5-millimeter coil is inserted into the eye through a needlestick that punctures that portion of the eye to make a hole, during a procedure that takes between eight and 10 minutes, Chambers said. The coil is designed to be implanted on an outpatient basis.
Chambers said InnoRx plans to initially seek FDA approval to market its helical coil for diabetic macular edema, a swelling or thickening of the macula which results from diabetic retinopathy.
A Phase I clinical trial, which involves first-time testing of the treatment in humans, is scheduled to begin in December and likely will take place in southern California, Chambers said.
If all goes well, the product likely will reach the market by 2008 or 2009.
De Juan, who graduated from USA's College of Medicine in 1979, was on the medical staff at Duke University Eye Center for nine years and spent another nine years at the Wilmer Eye Institute at Johns Hopkins University School of Medicine before going to USC.
While at Johns Hopkins, the physician -- along with a team -- invented several devices now being developed by InnoRx. The Mobile company licensed the systems from Johns Hopkins.
Chambers said the market focus of treatment has moved away from oral medications to so-called drug delivery systems, such as the helical coil.
He compared the human body to a football field, saying the eyeball is like a 50-cent piece on the 50-yard line. To take a drug orally, he said, is like watering the whole field just to tend a minute area. [Well, of course they would say that!]
Lazar, the medical device and technology analyst, said there are about 200 drug delivery systems in the primitive stages of development but none have progressed as far as InnoRx's coil.
Lazar said the field is flourishing for a few reasons: the number of cases of blinding disease is expected to increase significantly as the large Baby Boom generation ages, carrying a socioeconomic impact; and it's an "extraordinarily lucrative market" because of the unmet need.
"Although 55 percent of all debilitating eye diseases and conditions occur in the back of the eye, it is estimated that less than 5 percent of ophthalmic pharmaceutical sales are derived from drugs designed to treat these disorders," InnoRx reports." Some analysts predict this market will be $4 billion to $5 billion within the next decade."[FWIW: I’ve forecasted a $6B global market (#msg-1832330).]
In addition to investing in InnoRx, SurModics plays another role.
InnoRx has an exclusive license from the Minnesota company for its coating technology, to be used to apply medication to the helical coil, so the drug will be released slowly, over time.
Barclay, the president of SurModics, said as his company learned about InnoRx's products, "the more excited we became about working with them." SurModics then became an investor because "we liked the company so well."
In addition to its helical coil, InnoRx is focusing its efforts on another product, a subretinal drug delivery system, which is currently being tested in animals. A retinal barrier in the eye protects it but also prevents some drugs from getting in. The helical coil will be in front of that barrier, according to Chambers, but the subretinal system would deliver the drug behind the barrier.
It would be "immediately taking the drug to exactly where it's needed," Chambers said.
The subretinal system uses small implantable filaments, which also would be coated with medication using SurModics' technology.
The system is about a year behind the development of the coil, Chambers said.
InnoRx has several other products under development, including a subretinal injector and orally administered medications and vitamins.
The company plans to open an office in southern California within the next three to four months, Chambers said.
He added that InnoRx is a small company, but with de Juan's expertise, "we're on the cutting edge of a very important development in opthamology [sic –at least they’re consistent!]. <<
[SRDX, the company which makes the polymer coating for JNJ’s Cypher stent, has been interested in expanding its presence of ophthalmology. By acquiring InnoRx, they now have a platform from which to work. Please see #msg-3781650 for a primer on InnoRx’s device.]
Platform Technology for New Ophthalmology Business Unit
EDEN PRAIRIE, Minn.--(BUSINESS WIRE)--Jan. 19, 2005--SurModics, Inc. (Nasdaq:SRDX - News), a leading provider of surface modification and drug delivery technologies to the medical device industry, announced today that it has acquired InnoRx, Inc., a drug delivery company developing novel therapies for the ophthalmology market. InnoRx was founded by world renowned retinal surgeon and inventor Eugene de Juan, Jr., M.D.
Prior to the acquisition, SurModics held an ownership interest in InnoRx of less than 20 percent. To acquire the remaining interest, SurModics paid approximately $4.1 million in cash and issued approximately 600,000 shares of SurModics stock. Upon successful completion of certain development and commercial milestones, the company may issue up to an additional 600,000 shares of stock. This contingent structure includes milestones based on FDA approval, as well as achievement of pre-defined U.S. revenue targets from products that incorporate InnoRx's technology targeting age-related macular degeneration (AMD) and diabetic macular edema (DME).
This acquisition solidifies SurModics' relationship with InnoRx and extends the company's reach into the large and rapidly expanding ophthalmology arena. SurModics' initial focus will be to utilize InnoRx's technology platform to treat AMD and DME, two of the leading causes of blindness. According to industry analysts, these retinal diseases affect more than 15 million people in the U.S. and represent a market opportunity projected to reach $2.5 billion to $7.0 billion within six years.
Anticipated Acquisition Benefits
• Advances the current business model and positions SurModics to capitalize on site specific drug delivery applications in growing markets for the treatment of diseases of the eye, including retinal disease; • Gains control of a technology platform which may be leveraged with a variety of customers in additional product iterations, applications and indications within ophthalmology and beyond; • Strengthens the pipeline and reinforces SurModics' commitment to its focus markets; • Leverages SurModics' expertise in biomaterials, drug delivery and product development; • Provides greater influence over product development and timelines; • Captures more elements of the value chain (the polymer, the device and, in some cases, the drug), bringing the potential for higher royalty rates from SurModics' customers; • Presents an additional potential future revenue driver.
"We have had a close working relationship with InnoRx for the past three years, during which time we have become increasingly confident in the underlying technology and our ability to create synergies between the two organizations," said Bruce Barclay, SurModics' President and Chief Operating Officer. "Today's announcement reflects our mutual commitment to solving the problem of sustained delivery of various therapies in the eye, a significant unmet clinical need. We believe that folding InnoRx into SurModics will accelerate our entry into an attractive market, strengthen our pipeline and deepen our ability to exploit the convergence of drugs and devices with multiple customers."
Lead Product: Sustained Release Intravitreal Implant
SurModics will establish a new ophthalmology business unit and continue development of InnoRx's drug coated intravitreal implant as its lead product. The implant has the ability to deliver drugs targeted at AMD and DME and is the result of nearly three years of collaboration between SurModics and InnoRx. The device, which provides therapy on a sustained release basis for well over a year, can be implanted using a simple in-clinic procedure, rather than an operating room procedure, and may be removed once the drug has been fully released. Currently, the majority of treatments being developed for AMD and DME require repeat injections into the eye every one to three months, often with a suboptimal drug dosing profile. Replacing multiple injections with a single implant, which provides long-term, controlled drug release, could represent a significant advance in therapeutic treatment, including improved patient compliance, reduced side effects and greater efficacy.
Platform Technology
The InnoRx drug delivery technology represents a platform technology which can be developed either alone by SurModics, or with a partner using their own proprietary drug or targeting a specific indication. InnoRx has been developing a product specifically targeted for use in treating DME. This DME product has recently completed successful pre-clinical studies, and InnoRx has filed an Investigational New Drug application with the United States Food and Drug Administration. Human trials are expected to begin in the first half of 2005. In addition to the intravitreal implant platform, other technologies were also acquired as part of the transaction.
Dr. Eugene de Juan, Jr., Founder and Chairman of InnoRx, commented, "My vision for InnoRx has always been developing practical and effective therapies for patients suffering from serious eye diseases. By leveraging SurModics' biomaterials and drug delivery technologies and expertise, and strong customer relationships, I believe we can make that vision a reality. Our combined strengths will improve and expand the applications for the technology, which will result in dramatic benefits to the patient. SurModics is writing a new chapter in its history, and I am excited about the opportunities moving forward."
"Dr. de Juan is a highly respected member of the ophthalmology community," commented Dale Olseth, Chairman and Chief Executive Officer of SurModics. "His creativity, passion and reputation as one of the leading retinal surgeons and inventors in the world have allowed InnoRx to create a significant and valuable drug delivery platform. We are delighted to be associated with the fine people from InnoRx and welcome them into the SurModics family. We look forward to the significant contributions they will continue to make to our company."
Michael Chambers, President and CEO of InnoRx, commented, "SurModics is superbly positioned to extend InnoRx's platform technology to companies that have effective compounds, but lack the ability to deliver their compounds in a sustained release manner for significant periods of time. We believe that this platform may have promise not only for retinal diseases, but ultimately for glaucoma and cataract indications as well. InnoRx has been receiving heightened interest from leading companies in the ophthalmology and pharmaceutical industries. The market has confirmed the current need for novel approaches to ocular drug delivery, and we believe the combination of InnoRx and SurModics is well timed to take advantage of this opportunity."
New Ophthalmology Business Unit
SurModics' new ophthalmology business unit will be located in Southern California. This location facilitates the continued involvement of InnoRx's development team and is in close proximity to Dr. de Juan, who currently serves as CEO of the Doheny Retina Institute at the University of Southern California Keck School of Medicine in Los Angeles. Dr. de Juan will serve as a clinical consultant to SurModics and remain actively involved in the continuing development of the technology. Signe Erickson Varner, Ph.D., former Assistant Professor of Ophthalmology at the Doheny Eye Institute, played a key role, with Dr. de Juan, in the invention and development of the intravitreal implant technology for InnoRx. She has joined SurModics as Director of Research and Development within the business unit and will guide the integration efforts of the two companies and lead the development of new products. Michael Chambers will also serve as a consultant to SurModics and assist in integration and business development efforts.
Live Webcast
SurModics will host a Webcast at 10:30 a.m. ET (9:30 a.m. CT) today to discuss the InnoRx acquisition. To access the Webcast, go to the investor relations portion of the company's Web site, www.surmodics.com. If you do not have access to the Internet and want to listen to an audio replay of the acquisition conference call, dial 800-405-2236 and enter conference call ID # 11022302. The audio replay will be available one hour after the event and will be archived for one week.
About SurModics, Inc.
SurModics, Inc., a leading provider of surface modification and drug delivery solutions, licenses its proprietary technologies to medical device, diagnostics, and biotechnology companies around the world. A significant portion of SurModics' revenue is generated through royalties on the sale of coated products. SurModics' Internet address is www.surmodics.com.
About InnoRx, Inc.
InnoRx, Inc. is a development stage company focused on the development of drugs and drug delivery systems for ocular disease. InnoRx is a private company founded by Dr. Eugene de Juan, Jr., a renowned retinal surgeon who currently serves as CEO of The Doheny Retina Institute at the University of Southern California. Dr. de Juan was formerly the Joseph Green Chair of Ophthalmology for Age-Related Macular Degeneration at the Wilmer Institute of Johns Hopkins University. <<
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