For the morbidly obese (BMI > 40), liposuction is not really an option. But for a much broader set of women – those with fat deposits in ‘problem areas’ that respond poorly to diet and exercise – liposuction is a perfect fit.
And if you’re going the lipo route, one of the best options out there is Smartlipo MPX by Cynosure. Cynosure, a developer of a broad array of laser-based aesthetic systems, received a CE Mark for Smartlipo this week.
Smartlipo simultaneously liquefies fat and tightens skin through coagulation. The minimally invasive procedure is performed under local anesthesia; incisions are so small that they don’t require suturing.
Cynosure expects to launch Smartlipo MPX through its subsidiaries in the EU beginning this quarter. The company began selling the system in the U.S. in late April – to rave reviews and prominent media coverage.
A European market presence represents the next phase of a multi-pronged strategy to expand the geographic reach of Smartlipo. Training in Europe has already commenced. The rollout will be followed by a targeted launch in the Middle East, as well as ongoing submissions for regulatory approvals in the Asia Pacific region.
In its first quarter (ended March 31st), Cynosure managed strong growth on improved gross margins. Revenues increased 41% to $36.8 million in the first quarter of 2008 from $26.1 million in the first quarter of 2007. Gross profit margin increased to 66.3% from 62.0% over the same period.
Cynosure will release Q2 results one week from today; I’m excited to see the impact of Smartlipo sales.
Treatment for cellulite is a healthcare holy grail – second only (in this author’s opinion) to a cure for male pattern baldness. As the bane of women the world over, interest in the space is hearty.
Elemé Medical has developed the FDA-cleared SmoothShapes system, a proprietary technology (dubbed Photomology) to treat the underlying causes of cellulite. Photomology combines laser energy with mechanical massage and vacuum to improve the appearance of the skin surface, but only temporarily.
The company, private and venture-backed, raised $18 million this week in a “Series C” financing led by L Capital Partners. The round also included Hambrecht & Quist.
In a multicenter, prospective, randomized and controlled clinical study of the SmoothShapes system, 81% patients treated showed reduction in subcutaneous fat in the ‘treated’ versus ‘untreated’ leg. Most patients found the treatment comfortable and 80% wanted to continue “ongoing maintenance treatment”. What’s better than a cure for cellulite? A solution that requires ongoing treatment!
Targeted markets include plastic surgeons, dermatologists, OB/GYN and primary care specialists, medi-spas, aesthetic clinics and health clubs. In 2006, the body shaping market generated $4.5 billion in device sales, procedures and fees. By 2011, the market could grow to $8.1 billion, says Michael Moretti, in his Global Body Shaping Market Analysis, published in 2006. Expansion will be “driven both by rising demand from consumers and expanding supply from practitioners,” says Moretti.
The newly raise funds will be used to commercialize the SmoothShapes System and also to further the company’s pipeline of body shaping technologies.
NxStage Medical, a Lawrence, MA company that makes dialysis systems, has released new end-stage renal-disease (ESRD) patient data. The information was derived from a registry of NxStage patients who undergo hemodialysis at home using the company’s System One.
Compared to the conventional regimen of thrice-a-week therapy at a dialysis center, survival and transplant rates were significantly higher among the NxStage patient population. NxStage patients experienced 50 percent-plus reduction in expected mortality as compared to the overall U.S. hemodialysis patient population.
Survival is the “gold standard” of clinical outcomes. Multiple observational, retrospective studies have been published demonstrating 45% to 61% reductions in mortality with home and/or daily dialysis (a randomized, controlled trial of survival of the daily hemodialysis population is unlikely to occur, given study size and enrollment limitations).
Geographic data shows NxStage is doing a good job breaking down barriers to initiating System One use; 92% of the U.S. dialysis population resides within 60 miles of a center offering NxStage home hemodialysis training, and nearly 80% are within 30 miles.
At the end of the first quarter 2008, NxStage was working with 355 dialysis centers to provide home hemodialysis therapy to 2,481 end-stage renal disease patients.
This compares to 200 centers and 1,295 patients at the end of the first quarter of 2007. The company expects to end the year with between 3,100 and 3,500 patients using its System One device.
NxStage has yet to recover from a disappointing earnings report that sent shares plummeting to the four-dollar range. Though revenues grew nearly four-fold to $31.0 million in Q1 (compared to $8.4 million in the first quarter of 2007), NxStage’s loss widened to $13.9 million from $12 million. The cost of sales grew to $27 million from $10 million; operating expenses rose 54% to $17.2 million, year-over-year.
The company remains committed to top line growth. And according to Jeffrey Burbank, President and CEO of NxStage, “[We’re] confident that home daily hemodialysis is a significant market opportunity in particular, over the long-term because of its clear patient benefits.”
San Clemente, CA-based ICU Medical nearly doubled net income despite stagnating top line growth and a poor-performing critical care business.
Second quarter revenue was $48.6 million, compared to $48.9 million in the same period last year. Net income was $4.8 million, compared to $2.5 million in Q2 2007. Gross margins expanded 3 percentage points to 43%.
Custom system sales were up 12% during the second quarter, compared to last year, while sales from new products, including oncology, increased over 65% on a sequential basis. This growth was offset by continued weakness in critical care products that the company manufactures for Hospira (in 2005, ICU paid $35 million to buy a 450,000-square-foot plant from Hospira). Excluding critical care, revenue grew 9% year-over-year.
Scott Lamb, ICU’s CFO commented, “As evidenced by our recently renewed agreement with MedAssets Supply Chain Systems, we are well positioned to expand our distribution network for our CLAVE, Custom and oncology products. These agreements validate our reputation as a low-cost and quality leader in the industry and create additional growth opportunities for years to come.”
MedAssets is one of the nation’s largest group purchasing organizations. Under the terms of the amended agreement, MedAssets will continue to co-market ICU’sCLAVE and MicroClave Needleless IV systems along with Specialty custom sets for a minimum of three additional years, through September, 2011.
ICU has a pile of cash on hand; as of June 30th, cash and investments totaled $109 million and working capital was $148 million. I’d expect ICU to fund future expansion by strategically exploiting this position, preferably through acquisition of product lines or companies.
2008 revenue guidance was in the $190 - $200 million range. The company expects annual gross margins to be approximately 43% and diluted earnings per share to be in the range of $1.35 - $1.45.
One in four Americans is now obese, says the CDC. While it’s less than welcome news, you can hardly say it’s surprising – we’ve been growing fatter as a nation for decades.
That dead weight is sure to hamper our healthcare system and the economy as a whole, but its boom time for device makers so disposed. In the U.S., doctors perform 140,000 gastric bypass surgeries each year.
24 million Americans have diabetes, an increase of 3 million people in just two years, according to the CDC – that’s 8 percent of the U.S. population. 25 percent of Americans 60 and up live with the condition and 57 million people are thought to have pre-diabetes.
According to the American Diabetes Association, in 2007, medical expenditures for diabetes was an estimated $116 billion: $27 billion for diabetes care, $58 billion for chronic diabetes-related complications, and $31 billion for excess general medical costs.
About 1% of patients who are candidates for gastric bypass surgery actually have the procedure. Mortality risk has been cited a major deterrent to broader use.
By region, the prevalence of obesity was higher in the South (27.3%) and Midwest (26.5%). Obesity prevalence was >30% in three states: Alabama (30.3%), Mississippi (32.0%), and Tennessee (30.1%). I blame air conditioning.
Treatment for cellulite is a healthcare holy grail – second only (in this author’s opinion) to a cure for male pattern baldness. As the bane of women the world over, interest in the space is hearty.
