Wisconsin orthopedics startup seeks $5 million

A Wisconsin startup is hoping that its disruptive technology will alter the landscape of osteoarthritis treatment forever.

Currently, osteoarthritis, especially in the knee, is often treated with hyaluronic acid-based injectable viscosupplements that are meant to alleviate pain and boost joint movement.

But Madison, Wisconsin-based Flex Biomedical has developed a polymer-based synthetic viscosupplement that co-founder and CEO Sal Braico contends is a better lubricant and provides excellent cushion compared with those hyaluronic acid-based (HA) products. Braico adds that the injectable fluid stays in the joint for a longer period of time and is also cheaper to manufacture.

Flex Biomedical was founded in 2007 with an exclusive license from Boston University where the polymer was developed. In an interview after the IBF MedTech Investing Conference last week in Minneapolis, Braico said the company is engaged in preclinical testing and is looking to raise $5 million in capital to help it win the CE Mark approval in Europe. The three-person company has raised $2.6 million to date from angels and plans to begin human trials next year.

The market opportunity appears to be huge. Braico said 27 million Americans battle the condition and the number is several times higher than those managing diabetes. In fact , Toronto, Canada-based Millennium Research Group said in a December report that the global market for hyaluronic acid (HA) viscosupplementation was valued at nearly $1.4 billion last year. The U.S. is the largest and the fastest-growing market for hyaluronic acid supplementation.

Braico isn’t daunted by the PMA path required to take a shot at that fast-growing U.S. market.

“The clinical trials are inexpensive — you can rapidly recruit trials for osteoarthritis just due to the number (of patients) out there and due to the fact that people want to have something that works,” Braico said.

That confidence stems from his belief that there are doubts about the efficacy of HA products. In 2003, an article in the Journal of American Medical Association said that HA products only offered a slight benefit compared with placebos. However, a 2009 study by researchers at the New York University Hospital for Joint Diseases, University of Virginia and the University of California at Los Angeles found that recent clinical studies show evidence of efficacy of HA injections and they are gaining in popularity. Peter Bianco, a Twin Cities business development executive who is a paid advisor of Flex Biomedical, said he is very excited about Flex Polymer because the efficacy of HA products varies widely depending on whom you ask.

“Some perceive hyaluronic acid-based products to be a giant placebo,” he said.

Flex Polymer will be similar to HA products like Genzym’s Synvisc-One and Seikagaku/Zimmer’s Gel-One in that it is a single injection to be administered twice a year in accordance with current reimbursement policies, Braico said. There are earlier iterations of HA products that needed to be injected once a week for three to five weeks. But Braico contends that Flex Polymer can stay in the joint for multiple weeks as opposed to just a few days for older, multiple and newer single-injection HA products.

Currently, the focus is to complete preclinical testing on dogs, Braico said. And to raise $5 million. Braico is talking with venture capitalists, but believes that the money will likely come from a strategic investor. The company’s board of directors certainly includes someone who likely understands the needs of a strategic investor. Don Urbanowicz, formerly vice president of business development at Stryker Orthopaedics, joined Flex Biomedical’s board in February.

Copyright 2013 MedCity News. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

---