Extra staff and manufacturing capability in Cambridge will provide the springboard for an assault on global markets for Sphere Medical following its £15m November fundraising and AIM IPO.
The US, Japan and Europe are on the UK medical device company’s immediate radar. But CEO Stuart Hendry revealed to Business Weekly that other territories were inked onto the global growth map.
He told me: “It has been a challenging journey indeed and there is still lots to achieve but the IPO, fundraising and subsequent expansion at Harston is very much be a major step on the way.
“In terms of our technology, Proxima has ready markets in the US, Japan and Europe but we have interest on a global scale.
“And regarding the Pelorus1000 – the world’s first propofol analyser – we have made sales in the US and Japan with some very exciting data starting to be produced.”
Sphere Medical is completing the development of a range of monitoring products designed to provide significant improvements in patient care in a number of hospital specialities, focusing initially on critical care.
Its lead product, Proxima, based on the company’s patented microanalyser platform technology, is a patient-attached disposable silicon diagnostic microchip that enables near ‘real-time’ monitoring of the patient’s arterial blood at the patient’s bedside.
Sphere received FDA 510(k) certification for its Proxima Generation 1 device incorporating the microanalyser platform technology in March 2011 and has also received EU CE Marking. This Proxima Generation 1 device is expected to act as the predicate device for future generations of Proxima devices.
The company has undertaken extensive trials of its Proxima Generation 2 patient attached device as a precursor to a clinical trial currently being conducted in West Suffolk Hospital and University Hospitals Birmingham, one of the largest ICU centres in Europe.
This trial is expected to complete shortly and the results from this trial are expected to be used for EU CE Mark certification and for the submission of a FDA 510(k) application by the end of 2011.
Sphere’s principal route to commercialisation is expected to be through partnerships with market leading companies which already have significant market share in relevant end markets.
Edwards Lifesciences Corporation, a leading cardiac and critical care company, made an investment of £2 million in the Company in 2010. Sphere has a signed development and commercialisation agreement with a leading heart-lung bypass company, Sorin Group Italia S.r.l., which has also invested £0.25 million in the company and has been working with Sphere to develop a continuous blood monitoring product for use in cardiopulmonary surgery.
Siemens Technology Accelerator GmbH a founder of Sphere, also retains an equity stake and has continued to invest in the Company in recent fund raisings.
Sphere’s patent portfolio currently consists of 27 patent families and has intellectual property in the form of manufacturing processes that are kept as trade secrets.
Sphere employs 44 staff in the areas of research and development, product development, sales and marketing and management and operations. Hendry says he expects headcount to increase but it is too soon to say by how many.
Proxima is being positioned to address a very large market. Arterial blood gas testing in critical care settings is a large and established market and is a standard of care in a number of situations.
Each year an estimated 340 million blood gas and electrolyte tests are carried out globally and the current market size for equipment and consumables is estimated at $1.2 billion.
The company estimates that 240 million of these tests are carried out on patients in the ICU and OR with an arterial line in place. On average, ICU patients stay for around three days and the company estimates that around 20 blood measurements are taken during that time period.
The Proxima Generation 2 device is fitted into the patient’s arterial line and the company estimates that there are 12 million arterial lines placed world wide each year. It is expected to have a number of key advantages including, ease of use, rapid results, equivalent accuracy to the “gold standard” laboratory bench-top analysers, as well as significant cost savings.
Sphere’s cardiopulmonary bypass in-line blood monitor is in late stage development to provide the continuous near real time monitoring of blood circulating through the bypass circuit in heart-lung machines. The device measures pH, pCO2, pO2, K+, temperature, oxygen saturation and haematocrit continuously.
The company intends to submit an EU CE Mark application in Q1 2012 and a FDA 510(k) submission in Q2 2012 ahead of anticipated commercialisation in H2 2012.
Via its Pelorus 1000, Sphere has developed what it believes to be the only commercially available device for the near real time measurement of propofol, one of the world’s most widely used intravenous anaesthetic, used for the induction and maintenance of general anaesthesia in the OR and general sedation in the ICU.
The Pelorus 1000 has received EU CE Marking for research use. The Company has already achieved the sale of a Pelorus 1000 to a Japanese research institution and also consumables to a range of customers.
As previously reported, Sphere intends to raise up to £15 million by way of a placing of ordinary shares to institutional and other investors. Sphere expects to be EIS and VCT qualifying and to use the net proceeds of the placing to fund the continued development, regulatory approvals and commercialisation of the next generations of its Proxima devices as well as the cardiopulmonary bypass device and its Pelorus 1000 propofol device.
The company will be investing in its Harston manufacturing and operations to support the anticipated growth from the commercialisation of its products.
Stuart Hendry has over 20 years’ experience in the medical device industry and founded Sphere in 2002. He previously held positions with Generics Group plc. PowderJect plc, Diametrics Inc. and Pfizer Hospital Products.
Dr Hendry, said: “It is an exciting time for Sphere. With almost 10 years of development accomplished, we believe we are now in a position with our leading device, Proxima, to achieve a key milestone with its commercial launch in 2012.
“Similarly, there are a number of further products utilising our core microanalyser technology, specifically, our cardiopulmonary bypass monitor, which is expected to achieve commercial milestones in 2012.
“An AIM listing is an important step in our continued growth and our ambitions to become a leading player within the critical care diagnostic market.”
Thursday, 20 October 2011 14:43 Tony Quested