August 15, 2024 • 42 mins
AVS aims to redefine intravascular lithotripsy with its Pulse IVL System, which utilizes hydraulics technology to fracture calcified lesions and expand the diseased vessel with a single device, executive chair Mark Toland explains to Bloomberg Intelligence. In this Vanguards of Health Care episode, Toland sits down with BI analyst Matt Henriksson to discuss what differentiates the Pulse IVL System from current technology to make it more flexible and durable. He also highlights first-in-human results, the next clinical milestones and the mounting market opportunity as an older demographic brings hardened lesions that require IVL technology.
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Episode Transcript
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Speaker 1 (00:21):
Welcome to another exciting episode of the Vanguards of Healthcare
podcast series. My name is Matt Hendrickson, the medical technology
analyst at Bloomberg Intelligence, which is the in house equity
research platform of Bloomberg ELPET. We're pleased to have with
us today Mark Toland, executive chairman of AVS, a privately
held medical device company that is developing new innovation in
(00:43):
intravascular lithotripsy or IVL for short. Mark, thank you for
joining us today.
Speaker 2 (00:48):
Hey, Matt, thanks for having us. We really appreciate it.
Thanks to Bloomberg as well. Looking forward to the conversation.
Speaker 1 (00:54):
Absolutely, And why don't we just start with a quick
overview of what AVS is and you know, why are
they what are they developing?
Speaker 2 (01:04):
It's a really good question. You know. One of the
challenges that we've had with arterial disease for years and
years has been calcium burden inside the vessel. And there
was a company by the name of Shockwave that took
a concept from kidney stone oblations and cracking kidney stones
(01:26):
and took it into the arterial system to be able
to do calcium modification prior to implanting a stint to
restore blood flow. So we're on the very same journey
that they are, which is what's called intravascular lithotripsy.
Speaker 1 (01:38):
Very interesting, and then you've joined AVS a few years ago.
What were the steps that got you to your current
position there.
Speaker 2 (01:48):
Yeah, we had a fun experience with the University of Michigan.
My venture capital firm, Biostar Capital, was on a board
of a technology board at the University of so we
were able to see technologies in their incubator and we
really liked this one, so we decided to pull it
out of the University of Michigan's incubator and start a
(02:08):
company AVS. We did that in twenty twenty and since
then we've been on a journey to develop the tech,
put it in a position where we could start to
do clinical trials and eventually bring it to the market.
But if it wasn't for the work of Robert Cisida
and hit tender Germ, the founders of the company at
the University of Michigan and the incubator, we'd never be
(02:29):
where we are today.
Speaker 1 (02:31):
And that's always the case, or it's always the you know,
it's kind of the CEOs or the founders in the
garagees creating the innovation. Yea, literally and know your background also,
you were the CEO of Corindas, and you spent a
lot of time at Boston Scientific, which is one of
the top tier large cap medical device companies out there.
(02:53):
What experience is there helped you, you know with this
role and you know as you're going to continue to
build out avs.
Speaker 2 (03:01):
Yeah, the Boston Scientific experience was critical for a number
of factors. Primarily during the course of the roller coaster
ride of Boston Scientific, you learn how to build businesses
and then you learn how to go fix problems. And
we were a company that was a series of acquisitions
and you never knew what problems were coming your way.
(03:22):
So as a result of that experience, you were able
to come into smaller companies like Corendas, assess problems very quickly,
put teams, resources and plans in place to go solve
the problems, and eventually move your milestones up faster than
the originally thought. We got lucky at Carendas we pivoted
from the heart to the brain. The brain worked, and
(03:43):
we were fortunate enough to develop a strategy around telestroke
that appealed to several of the strategics and ended up
being sold to Siemens for one point one billion in
twenty nineteen. We've since then focused our attention on build
bilding early stage companies in the same manner, working on
(04:04):
technology that has an unmet deed, a big market and
we like the tech the text doing something that may
be different than current tech in the space. And then
once you're on that journey, you move into the tech
dev world of going to build product, you typically solving
problems along the way. Then you move into the clinical
(04:24):
trials and building evidence to support your technology, particularly with
patient outcomes, and then if all goes well, you eventually
get to the part of commercialization. So where we are
with AVS right now is moving into the clinical trial stage,
which is super exciting.
Speaker 1 (04:42):
Yeah, and I'm sure we'll talk more about where we're
going with the clinical trials, but let's start with that
unmet need. And you know, there's when you think of
lesions and the arteries, you don't think of them as
being calcified. But why is it important to distinguish between
a normal lesion and the artery and a calcified lesion.
Speaker 2 (05:06):
Yeah, So think of calcium as almost like bony like
structures inside your artery. They build up over time, and
now that patients are living longer, we're treating more complex
disease and arteries. Twenty years ago, thirty years ago, we
were treating patients in their sixties, and now we're treating
(05:26):
patients in their seventies and eighties. As you age, over time,
the calcium builds up to a structure that's very difficult
to treat because you need to crack it before you
can expand it. And one of the things that we've
done over the years is we've developed fantastic technology for implantables,
(05:50):
so stints today are standard of care. But a stint
can only expand it so much. If the calcium's in
the way, it can't open it up to restore maximum
blood flow. And that's ultimately the goal, to restore blood
flow at the ultimate level where you don't need to
go back and to retreat it down the road.
Speaker 1 (06:05):
Okay, it's almost now. It kind of giving me flashbacks
of all the times I have to clean up dry
plato on the rugs that my daughters are playing with.
It kind of sounds like that that over time, the
clogged arteries, it just hardens and then it just becomes
more difficult to treat it does.
Speaker 2 (06:21):
It's if you were to catch it earlier, it would
be more malleable, but as time goes on, it creates
structures that are very difficult to treat. And calcium, just
like your bones are made of calcium. It's essentially the
same thing. If you were to try to take a
bony structure inside an artery, you're going to need to
(06:42):
modify it before you want to try to expand it.
Speaker 1 (06:45):
And then when we think of the breakdown between the
patients that have calcified lesions and those that don't, you know,
I'm seeing numbers anywhere from thirty to sixty percent of
with clogged arteries are also calcified lesions. Is that the
right way to think about it? And what's kind of
the overall prevalence of kind of clogged arteries or the
(07:08):
market opportunity here potential for IVL.
Speaker 2 (07:12):
Well, doing heart procedures is probably the number one procedure
and really all of medicine right now. So coronary arteries
are treated about six million patients a year. Peripheral arteries
are close to four million patients a year, and of
those arteries that we treat, roughly thirty to fifty percent
(07:38):
would be highly calcified in complex lesions. So as a result,
the market's very big. If you were to do the
math on that, that's about five million patients with leg
disease as well as cornary disease or heart disease that
need some sort of calcium modification.
Speaker 1 (07:55):
Okay, and then that does bring us to the treatment options,
and maybe we can just start with the kind of
landscape before IVL and you know we're talking about now
we're having to treat these patients when they're older. The
legions are calcified. But what were the traditional standards of
care for treating these patients and why were there drawbacks
(08:17):
with those for the new calcified lesions.
Speaker 2 (08:20):
Yeah, calcified lesions have existed for years. We just didn't
have the tools necessary to do work with calcified lesions
that every physician could use. We developed tools, but the
tools were very complex to use and required high high skill.
An example would be a rotoblader device is a device
(08:42):
the Boston Scientific Manufacturers, and it would be a diamond
shaped burr that goes down the artery. Now you can
imagine a diamond shaped burr. Spinning multiple revolutions in seconds
requires a lot of skill, so people physicians were nervous
to use it that they might hurt the patient. So
(09:04):
you needed a lot of training, a lot of skill
to do it. And what happened with with intervascal lithotripsy
is it accomplished the same result as that but in
a much easier fashion to use.
Speaker 1 (09:18):
Okay, and then you know, why don't we then talk
a little bit about how you know iv L technology works.
You mentioned that it was originally used for kidney stones. Yeah,
how has that technology been able to be converted from
that treatment therapy to being able to treat the lesions
within the arteries?
Speaker 2 (09:39):
Yeah? So, IBL or lithotripsy is delivering energy to a
source that you're trying to modify. In this case, it's calcium.
So there's multiple ways to deliver energy to a source.
Shockwave uses acoustics or sound waves, and we use more
(10:04):
like hydraulics. So we're hitting the calcium about sixteen times
a second in around a peak pressure wave. That's two
to three times greater than a typical angioplastic balloon. So
an angioplastic balloon wouldn't have much impact on the calcium.
But if you're hitting the calcium at a higher peak
(10:26):
pressure with your energy source, it's going to start to
create cracks in the calcium that allows you then to
modify it. And the analogy I use for the common
person who thinks about this is if you were going
to tailgate at a Clemson Tigers football game on a
Saturday and you're trying to put ice in your cooler.
(10:46):
You go to the gas station and you get a
block ice, and the first thing you would do with
the ice would be break it up. And how would
you break it up? You don't hug it like an
angioplastic balloon would hug the artery and the calcium. You
throw it on the ground and then you roll it
over and you throw it on the ground again, and
that case, the the ice shatters and you're able to
(11:10):
then disperse the ice and mold the ice the way
that you want to. The same concept applies when you're
talking about lithotripsy delivered in calcium in arteries.
Speaker 1 (11:20):
Interesting, but you know, the one thing that I just
want to make sure though, is that what you know,
you throw the ice bag on the ground, ice shatters.
Sometimes those ice pieces break off and the you know,
they kind of scatter around around the bag. Is there
a risk of any of that calcified lesion breaking off
(11:41):
and then kind of traveling downstream to the body or
then back up to the lungs of the brain.
Speaker 2 (11:46):
Yeah, we've had to study that. And fortunately for the
human body, the calcium builds up in the medial layer,
the medium layer of the artery, and as a result,
it has the intimate layer that still lines it, which
is equivalent to the bag still holding the ice. Okay,
So fortunately for the human body, we protected against the
(12:08):
downstream effect of that based upon where calcium builds up
in the arterial wall.
Speaker 1 (12:13):
Okay, And so you know, we're we've talked a lot
about you know, Shockwaves being the first to market that
they've had great success with the launching their product. But
I noticed that you mentioned that there is difference in
the technology. You talked about shockwave being a sound wave
and you talked about your technology being the hydraulics and
(12:34):
the sixteen times per second. Why is that difference important
when you're developing your technology.
Speaker 2 (12:45):
Yeah, both technologies work. We're both delivering an energy source.
The difference is in some of the design principles. To
deliver a sound wave inside an artery, you need a
electrical admitter to create a bubble. It's called cavitation, and
the bubble pops and it pops inside the balloon, which
(13:09):
constrains that bubble, and when it pops, that's the sound
wave that's created. The emitters are electrical, so they're not flexible,
and your arteries are very twisted, so you need to
get around a lot of bins in arteries. So as
a result, the deliverability of that product is good, but
(13:31):
it could be better. And so our design principles was,
how do we help a physician treat more patients with
a more deliverable system that's easier to use. So we
eliminated all the emitters and work off of CO two
plus what we call a water hammer effect to create
(13:51):
a pulsatile energy like hydraulics. That it essentially allows the
balloon to go up and down sixteen times a second
and emit the same level of energy that a sound
wave would, but it also increases our efficiency of treatment.
Speaker 1 (14:05):
So it's the same peak pressure, just being able to
do it for a longer frequency. Is that the right
way to think about it.
Speaker 2 (14:13):
We have the same peak pressure that shock wave would have.
We will be more flexible with our cather because we
don't have emitters, and we'll also do more peak pressures
in a second, probably to the tune of about ten
times more than shock wave would do. So as a result,
we would likely be more efficient than they would be
(14:35):
in the procedure. And also, the emitters have a timeout factor,
meaning that they can only emit so many acoustical waves
before they time out and then you have to replace it.
Ours has no timeout factor. We don't have emitters, so
as a result, you could use our product as long
as you want.
Speaker 1 (14:54):
And that's that's for the generator, not the actual catheter. Correct,
that's the Oh, that's the catheter.
Speaker 2 (15:01):
Yeah, the distal end of the cather has the electrical emitters.
That's what has a timeout factor. They can do a
certain number, whereas we don't have that gating factor.
Speaker 1 (15:11):
Okay, And then for your technology as you're developing it,
are you focusing on the peripheral arteries first or the
coronary arteries first?
Speaker 2 (15:22):
Yeah, we we have a parallel passive development. Peripheral is
moving very fast and to the point where we're going
to enroll our first patient in a US ide clinical trial,
likely late August early September. We're planning on a trial
that's one hundred and twenty patients around twenty sites in
(15:44):
the United States, and we're very excited that we'll start
in September and enroll through the rest of the year.
The likely approval of that product will be sometime in
late twenty twenty five early twenty twenty six. And then
simultane so that we're in the we're in the development
stage of our Cornery product. Our Cornery product has the
(16:07):
same design principles of our peripheral product, which is a
key component of our equation. So the console or handle
and our amplifier can be used for both peripheral and
for coronary, so no change to those. And now we're
just modifying what the CATHER looks like so they can
go in smaller arteries. So the development phase for US
(16:30):
is seventy five percent complete. We're only working on the
CATHER now, so we'll be in first and humans likely
sometime in early twenty twenty five.
Speaker 1 (16:39):
Okay, that's a lot to go through, and let's go
through those kind of step by step let's start with
the perofhal because that's coming up first. Yeah, and it's
late twenty twenty five target for a US approval, right, Okay,
And so and you're going to plan to start the
IDE in September. What were some of the first in
(17:03):
human or early feasibility data that's out there. What kind
of what is that showing you as you're starting this
IDE trial.
Speaker 2 (17:11):
Yeah, there were three takeaways from our first and human.
Number one was ease of use, So the setup was easy,
the learning curve to use the product was easy, So
we felt very good about kind of our workflow. And
workflow in the cath lab is, believe it or not,
as important as the technology, so we felt really good
(17:32):
about that. The second thing that we saw is that
we treated lesions or treatment zones that were real world,
meaning they were very long. Sometimes in clinical trials you
just take the chip shots, and in this case, we
treated very long lesions successfully, which that talks about the
(17:55):
longevity of our product as well as the efficiency of
our product. And the second thing or the third thing
that we saw is it didn't matter what sort of
lesion we saw. So some lesions are concentric, they have
calcium all around the artery, and some lesions are eccentric,
they only have one hundred and eighty degree arc, so
(18:17):
it's not three sixty. And we were effective in both
lesion sets. Shockwave can't necessarily say that as well as
we can. So we felt pretty comfortable about workflow, about
our treatment times and how long we could treat lesions,
and then finally what lesion types we could treat.
Speaker 1 (18:37):
That's interesting though, with the lesion types, because I would
have thought that if the balloon is a full three
sixty around the arteries, it would cover, you know, it
would be able to you know, three sixty is bigger
than one eighty, you'd be able to get the one eighty.
But it sounds like that's not necessarily the case. So
what what is it about the eccentric calcified legions that
(19:00):
make it maybe more difficult or is that the one
that's actually the more difficult one.
Speaker 2 (19:04):
Yeah, it has to do with how we deliver energy.
So for us, we're delivering peak pressures on the surface,
so we're hitting it with the surface of the balloon
sixteen times. In a second, you have to realize that
shock wave is using sound. If we were in your
studio here with only two walls, Oh, the sound would
(19:28):
travel in different directions. It would go, it would go
to find, it would go the path of least resistance. Instead,
we have four walls around us. It works, sound works
better with four walls versus two walls.
Speaker 1 (19:40):
Yeah. No, that the light bulb went off there. And
so so now you have so you've had these initial
results from the first in human How how is the
trial designed? The ID trial designed with? Is it a
single arm study? What are the key data points that
(20:03):
you're looking for? I and I think you mentioned there
was one hundred and twenty patients going to be in
this one. Yeah, so where are some of the design
features for this trial?
Speaker 2 (20:13):
Yeah, so this trial, it's a it's a relatively simple trial,
not designed by us. Okay, So the first mover in
the space in this case, Shockwave designs their trial. So
(20:34):
when we come in as the second mover in the space,
we work with the FDA to understand if there's a
trial design that they want similar to Shockwave or different
than Shockwave. In this case, the FDA came back to
us and said, we want it just like Shockwave. So
and so it's a single arm trial. It's working above
(20:57):
the knee in lesions above the knee, and it's looking
for safety data Number one, are we causing any adverse events?
So we'll be managing that from the time of treat
all the way to six month follow up. And then
it's looking for indoluminal gain. So right now, the constriction
could be you know, twenty percent blood flow in an
(21:21):
artery that should be at one hundred percent as we
expand it. Where do we land after we treat? Are
we expanding enough to restore maximum blood flow? We saw
that in our early first and human data, so we're
pretty confident that we'll be in a really good position
to maximize the diameter to restore maximum blood flow.
Speaker 1 (21:41):
Okay, And if I remember correctly the shockwave trolley that
was after like a thirty day endpoint, correct, is.
Speaker 2 (21:47):
That they have six month follow up?
Speaker 1 (21:49):
They have six month fow up.
Speaker 2 (21:50):
Yeah, we have interoperative data we'll collect, which is right
there in the case, and then you'll follow the patient
for six months after the procedure.
Speaker 1 (21:58):
Okay. So and if you're looking at twenty twenty five approval,
I'm just trying to do my math here. Is it
gonna be a five to ten k approval. Yeah, that's right,
So give you know, maybe six to nine months, so
we could see some data potentially in early twenty twenty five.
Is that the is? Or is that that's maybe that's not.
Maybe that's too soon, given that you're going to start
(22:20):
the trial in September.
Speaker 2 (22:21):
Yeah. I would anticipate the data would likely start to
manage itself into or get communicated sometime in the fall
of twenty twenty five. Okay, we'll have all of our
application for the five ten K submission into the FDA
with our follow up and then more than likely at
(22:44):
a at whatever big meeting there is typically it's TCT
is a good example of a conference, a medical conference
where data gets presented. Twenty twenty five would be probably
a good target for us.
Speaker 1 (22:56):
That's that's good to know. Mark my calendar for that one.
Speaker 3 (23:01):
And then you know.
Speaker 1 (23:02):
One of the other things too, I know about the
shockwave is that because of the its design, it can't
be used for other functions of angioplasty. The multimodality is
is your product able to be able to do any
other functions as well? When you're when you're helping these
(23:24):
patients kind of clear their arteries.
Speaker 2 (23:26):
Yeah, that's one of the design principles that we tried
to solve when we were looking at the space. The
current product shock Wave, it's great product, does great work,
but can you do other things with it? And the
current design of their Their balloon, which is is basically
an anchor inside the artery, is a very compliant balloon,
(23:50):
so it's pretty malleable. It doesn't do much for expanding
the artery much more than the litho trips who would
break it up solo. So as a result, the physician
would need to come back in with something that could
expand the artery, so that requires them to use two devices.
We try to take that make it into one device
so that you could deliver litho tripsy first and then
(24:12):
you could use our balloon on the end of the
lithotripsy system to actually expand the lumen at the same
time or even after you delivered the lithotripsy, so you
would only need one device versus two.
Speaker 1 (24:27):
And that you know that saves time and we're talking
about the critical time within a catholas. Yeah two for one.
Speaker 2 (24:32):
Yeah, same time and cost yeah yeah.
Speaker 1 (24:36):
Anything else in the development for peripheral before we move
into coronary.
Speaker 2 (24:41):
You know, one of the things that is interesting about
this technology is because we're managing or we're we're working
with pressure waves, we're quickly able to read the pressure
wave and that gives you to benefits. Number one, if
(25:02):
the pressure wave were to change, let's say the balloon
were to rupture, you're now able to completely shut off
the system.
Speaker 1 (25:11):
Okay.
Speaker 2 (25:11):
So it has an extra safety feature for patients and
for physicians when something bad could happen. So that's one
aspect of it. The second aspect of it is that
pressure wave is creating a compliance curve. It's essentially giving
you data to say you're done with treatment.
Speaker 1 (25:31):
Oh okay.
Speaker 2 (25:32):
So that could be what we call one of the
first smart devices to ever hit the market.
Speaker 1 (25:38):
Yeah, because you're basically your balloon's not bursting, so you
can be able to say, hey, the balloon's at a
certain shape where we feel comfortable with the outcomes.
Speaker 2 (25:48):
It gives you a It gives you data coming back
from the treatment zone to be able to show that
the area you're treating has yielded.
Speaker 3 (25:57):
Yeah.
Speaker 1 (25:58):
Like I said, it just gives them much.
Speaker 2 (25:59):
Pretty interesting another data point to say, hey, I did
a safe procedure and it worked.
Speaker 1 (26:04):
Yeah, and that's you know, just helps out with the
process of for them in the cathlob to keep.
Speaker 2 (26:08):
Things moving right.
Speaker 1 (26:10):
And then just you know, moving to the cornery there
you say, you're talking about it's being seventy five percent
kind of through the comility.
Speaker 3 (26:18):
Yeah.
Speaker 1 (26:19):
One thing that caught my attention, and maybe this is
you know, is because you're talking about how there's no
electrodes and it's easy to move through those you know,
the peripheral arteries. The coronary arteries are smaller, so it's
got to be advantageous to be able to be able
to have that maneuverability and ease of use in those
arteries as well. Is that kind of one of the
(26:40):
key design features for going in the coronary artery? Is
there are there other features that kind of are you're
seen as a benefit beyond even what you're seeing in
the periferle arteries.
Speaker 2 (26:50):
Yeah. So what we've seen with stent development is that
you know, the lower profile that you make the product,
in other words, the size of the cafe it's going
to get the more places. And then secondarily, the other
thing we've learned is the more flexible you make the stint,
it's going to get the more places and likely going
(27:10):
to get there faster. So you know, our design principles
go back to that concept of Okay, if you remove
the emitters from the equation, you're not restricted by the
size of the emitters, so you can make the cathere
size smaller, which is a benefit for ease of delivery.
And then number two, because the emitters are electrical. You know,
(27:34):
electrical emitters don't bend, they're stiff, and if you remove those,
then you can get a more flexible device to go
around curves and bins in very small, little coronary heart
arteries where you're trying to treat something very distal or
further down the vessel to restore a maximum blood flow
(27:55):
and get the heart in a position where it can
recover again.
Speaker 1 (28:00):
And then just the timing around that. Right now, as
you're still working at the FDA on a potential first
and human yeah, trial, is that the right way to
think about it?
Speaker 2 (28:09):
We are we have a goal most of first in
humans and medical devices are done outside the US. We think,
because we are seventy five percent complete with our design
and we've gone through the peripheral approval of the idea
with the FDA that they're comfortable with our console, handle
(28:29):
and amplifier, and now that we're leveraging that into the
coronary trial, we'll show them are what's called V and
V verification of validation data of our catheter. They already
have and approved the other parts of the system. So
we feel pretty confident that the FDA will be interested
in bringing the first in human trial for the coronary
(28:51):
into the United States, which would be a lot of fun.
Speaker 1 (28:54):
Yeah, And because you know, actually, as you were just
saying that, I'm just thinking, you know, previous guests on
this show they've talked about a shift to doing clinical
trials in the US first over Europe, but mainly because
of the changes in the EU regulation. Does that play
a part in that as well, or was it mostly
(29:15):
just because you already have the design. You're working with
the FDA on the design for the peripheral well.
Speaker 2 (29:21):
A lot of the things that factor into the equation
are how fast your product is ready for the FDA
rigor because their requirement is high, you can go to
other countries around the world Europe excluded and have a
lower bar. You could go to countries like Australia, or
(29:42):
you could go to South America and they have a
lower bar for you to test your technology. You're right.
On Europe, they've definitely raised the bar. So they're probably equal,
if not maybe even greater than the FDA right now.
So as a result, you know, a lot of companies
are trying to find alternative countries to go do work in. We,
(30:04):
because we've already gone through the process with the FDA
for seventy five percent of our product, feel pretty comfortable
that the rigor we brought we brought to the FDA
is at a high level, so why not try And
so our first discussion with them on this topic will
be in the next thirty days. Well that'd be exciting
(30:25):
to Yeah, we'll see where it goes. Expectancy, pressure release.
We're confident with it. They'll be excited about it too.
Speaker 1 (30:31):
And so you know, actually the last thing, you know,
we talked about perifer, we talk about coronary. One of
the things that shock Wave had brought up is you know,
their development into other regions beyond that, mainly the carotid artery,
mainly even like a valvular technology before taver. Are those
any developments that you're working on as well.
Speaker 2 (30:52):
Yeah, I think we're learning a lot and Shockwave is
is helping the space because they're the pioneer, they're the leader,
and they're really investing in additional applications. So the applications
that kind of come to mind are the peripheral above
the knee, that's what we're working on. That's our trial.
There's also peripheral below the knee, so the disease that's
(31:15):
in the cafe area. That's another application that's really interesting
to us. There's the coronary art disease, which we've discussed,
so that's the third one. The fourth one is the
carotid arteries, and I'm going to come back to that
because I think that's an evolving story. And then the
fourth one is there's a lot of calcium in the
(31:37):
annulus of the aorda where we typically put valves in,
so this would be an option for breaking up that
calcium prior to evalve, or maybe even as a bridge
to evolve. So for us, we can't tackle all of
those as a small company, but we really feel excited
about peripheral above the knee. We feel excited about cornary.
(32:00):
We've obviously got plans in place there, and we've recently
been pulled into discussions on karateds so we're we're amplifying
that strategy today. And what's interesting about karateids is it
looks like there's some technology that's really showing great promise
for karated stinting and that could lead to more patients
(32:23):
getting stints in the karateid, and as a result of that,
it could lead for a demand for lithotripsy to break
up the calcium before they get the stint in the
karate versus having surgery. So we really like that space
and we're going to invest in that space in the
upcoming year. More than likely we'll start our trial probably
(32:45):
sometime in late twenty twenty five with that product.
Speaker 1 (32:48):
Okay, that's good to know as well, especially because you know,
moving to kind of the competitive landscape of IVL. I mean,
it's right now Shockwave is the only one in the market.
You're developing your product. There's large cap companies that have
discussed that they're developing theirs. How do you see the
(33:09):
competitive landscape currently and how do you see it kind
of evolving over time or is this one of those
things where you know, rising tide lifts, all boats.
Speaker 2 (33:21):
Yeah, well, any space that is a billion dollar space
is going to have plenty of interest in it. So
no surprise, there's plenty of competitors trying to solve problems.
You know. One of the things that we think about
is we think about we think about better widgets. So
there's a widget on the market today that does good work,
(33:42):
how can you make it better? And that's where we
go back to the design principles of our product. So
even if there are four or five products on the
marketplace at one point time, the idea of it is
yours easier to use? Is it? Is it a product
that physicians like to use, does have great outcomes, and
then eventually you kind of win the game. When we
(34:04):
think about what we're doing, we think we're a little
bit unique because we have a different mechanism action than
others that are creating sound waves. So you may have
a company that's doing a sound wave just like shockwave,
so me too. You may have another company that's creating
a sound wave with a laser source. Also a sound
wave and lasers are pretty difficult to work with. So
(34:29):
we really feel like we have some unique advantages with
our mechanism action that really allows us to have probably
the easiest to use intravascal lithotripsy on the market when
we get to the market.
Speaker 1 (34:41):
And so I mean and so if with that is
you're differentiating yourself from the rest of the competitive landscape,
how are you building out your patent protection or your
IP protection to be able to create that barrier from
other companies trying to develop a similar IVL.
Speaker 2 (34:57):
Yeah, it's a great, great question. And IP is so
import in all spaces, not just this one. We really
have been fortunate, you know, I give credit to a
tender germ doctor Gerham and Robert Chacina, the founders who
started filing patents and IP back at the University of Michigan.
(35:19):
So we're in a really good spot where are what
we call our secret sauce, how we actually deliver the
energy has been patented and granted. A lot of people
say we have patents that are filed, but until they're granted,
they don't really mean anything. So we have, you know,
a bulk of our product that has been granted. So
(35:41):
we feel pretty strong about our mechanism of action and
what we can protect against people who want to try
to go in that direction with what we're doing. The
the other thing that we're continuing to evolve our IP
strategy on is software. We think software and data is
the future of medicine, and as we think about software, patenting,
(36:03):
a lot of those different software components of development really
could be an important part of the equation.
Speaker 1 (36:09):
So just just I'm just thinking with software, is that
more kind of when we were talking about the smart
feature of being able to say, hey, the balloon is
full to this point, you're you've gotten to the point
of revasculizing the artery enough. Is that where you're thinking
about it with software?
Speaker 2 (36:26):
Yeah? I mean, so if you're if you're a physician
treating an artery today, the only data source you have
is a visual data source. You're looking at it in
a in a in a picture, and you're trying to
determine whether or not you're successful. Imagine you actually have
compliance data that verifies as long as as with the
image that you have been successful in treating that leision
(36:49):
and you can move to the next step. We've never
had that.
Speaker 1 (36:52):
In this space. Yeah, well, the space is only a
few years old.
Speaker 2 (36:58):
Tat treating treating calcium is been going on for a
long time. We just haven't done it that great until shock.
Speaker 1 (37:03):
A very good point. Yeah with IVL. Yeah yeah, and
so you know I've i mentioned about the IVL being
just a few years old. Start saying the next few
years out. There's a lot of developments here. It sounds
like five years from now you're going to have a
product for peripheral approved, coronary is going to be along
its way. How do you make the transition from a
(37:26):
clinical company that is, you know, developing this technology to
a commercial company. And then basically it goes back to
when we were talking about when we start off with you,
you know, using your skills from Boston Scientific and from
Corendice to be able to make this a commercialized product.
So how do you see that path plane out over
those let's say three to five years as the product
(37:47):
gets out.
Speaker 2 (37:48):
Yeah, so we'll be commercializing the peripher product in twenty six,
the croaded product in twenty seven, and the coronary product
in twenty eight. So you've got to boom, boom boom.
So three years a lot of launches. It'll be you
know a good time for ABS. The commercial aspect for
many companies our size, it's it's a. It's a complex
(38:12):
endeavor because it's uh, it's probably the most expensive thing
you'll do. So once you get to that stage, the
first thing you need is a lot of money. Yeah,
so you'll have to do a financial raise, you know,
prior to you commercializing the product. So that's number one.
You need, you know, a big, big bank account. Number
two is, uh, you need to have a network of
(38:36):
physicians and hospitals and you need to be able to
easily access them with a launch like that so that
they feel comfortable using your product and can champion your product.
Fortunately for us, having been in the space for you know,
twenty five thirty years, we know a lot of physicians
(38:57):
and we know a lot of the hospital networks. And
then the final element of this is, you know, don't
go too wide, too fast, And what I mean by
that is global launch. Stay in your biggest markets, focus
your attention there. In the US, you would take it
with a direct sales force. In Asia, particularly Japan, which
(39:18):
would be our biggest market. In Asia, you would use
a distributor salesforce and be selective on the distributor, and
then you would be really selective in Europe. Call it
the top five countries in Europe, and you would probably
use some sort of hybrid model of a direct plus
a distributor model there, so you could reduce your cash
burn allow yourself to get a revenue trajectory where you
(39:39):
could start to break even, and then the rest of
the world could come.
Speaker 1 (39:42):
Yeah, that's interesting. And also, you know, one of the
things you didn't mention, and that's because of what Chocola
has been able to do, is you don't need to
you don't need to get reimbursement set it's already there.
Speaker 2 (39:54):
Yeah.
Speaker 1 (39:55):
So that's always been the kind of you know you
used to you know, you think of it like it'd
be FDA approval, but then right after that you have
to think about reimbursement. But you already have that out there,
So it's nice. Yeah, s up there.
Speaker 2 (40:05):
I joke all the time whenever I see the shockwave guys,
I give them a big hug and say I love
you guys. Keep doing great work. Because they established the
pathway for other companies like AVS from a clinical standpoint,
they also established the market and they established the reimbursement pathways.
So a lot of the heavy lifting has already been done.
Speaker 1 (40:27):
And it's yeah, It's probably the first time I've ever
heard on one of these episodes that you would want
to give a competitor a hug.
Speaker 2 (40:33):
Yeah, of course, I love those guys. They're making avs
and other companies. Life's a lot easier the pioneers are,
you know, the pioneers and the market leaders drive markets.
Speaker 1 (40:46):
Yeah. But at the same time, what you're doing, though,
is you're being able to find aspects of a tech
new technology based off of what doctors are telling you.
When you're just making Yeah, you know, you're making an
alternative product for the doctors to choose that one if
they prefer that one.
Speaker 3 (41:05):
Yeah.
Speaker 2 (41:06):
Well, typically the first product on the market doesn't necessarily
mean it's the best product on the market over time.
So iterations and design principles and how you solve those
challenges are some of the things that we think about
in this company. And so we're not so focused and
on how fast we get to the market. We're more
focused than are we solving some of those problems that
(41:26):
our physicians are telling us about.
Speaker 1 (41:28):
Yeah, and that'll be exciting to see over the next
few years as we see the clinical data and we
see the products coming out. But Mark, thank you for
joining us today.
Speaker 2 (41:36):
Really, thanks for having Yeah. I really appreciate being here,
and thanks to you and Bloomberg for just a great
event today. Look forward to more.
Speaker 1 (41:43):
Yeah likewise, and thank you to our listeners for tuning
in today and we hope you join us for future episodes.
If you'd like to stay up to date, you can
click the subscribe button on Spotify or your favorite streaming platform.
Speaker 3 (41:54):
Take caress US must
Speaker 2 (42:26):
Bases
Welcome to another exciting episode of the Vanguards of Healthcare
podcast series. My name is Matt Hendrickson, the medical technology
analyst at Bloomberg Intelligence, which is the in house equity
research platform of Bloomberg ELPET. We're pleased to have with
us today Mark Toland, executive chairman of AVS, a privately
held medical device company that is developing new innovation in
(00:43):
intravascular lithotripsy or IVL for short. Mark, thank you for
joining us today.
Speaker 2 (00:48):
Hey, Matt, thanks for having us. We really appreciate it.
Thanks to Bloomberg as well. Looking forward to the conversation.
Speaker 1 (00:54):
Absolutely, And why don't we just start with a quick
overview of what AVS is and you know, why are
they what are they developing?
Speaker 2 (01:04):
It's a really good question. You know. One of the
challenges that we've had with arterial disease for years and
years has been calcium burden inside the vessel. And there
was a company by the name of Shockwave that took
a concept from kidney stone oblations and cracking kidney stones
(01:26):
and took it into the arterial system to be able
to do calcium modification prior to implanting a stint to
restore blood flow. So we're on the very same journey
that they are, which is what's called intravascular lithotripsy.
Speaker 1 (01:38):
Very interesting, and then you've joined AVS a few years ago.
What were the steps that got you to your current
position there.
Speaker 2 (01:48):
Yeah, we had a fun experience with the University of Michigan.
My venture capital firm, Biostar Capital, was on a board
of a technology board at the University of so we
were able to see technologies in their incubator and we
really liked this one, so we decided to pull it
out of the University of Michigan's incubator and start a
(02:08):
company AVS. We did that in twenty twenty and since
then we've been on a journey to develop the tech,
put it in a position where we could start to
do clinical trials and eventually bring it to the market.
But if it wasn't for the work of Robert Cisida
and hit tender Germ, the founders of the company at
the University of Michigan and the incubator, we'd never be
(02:29):
where we are today.
Speaker 1 (02:31):
And that's always the case, or it's always the you know,
it's kind of the CEOs or the founders in the
garagees creating the innovation. Yea, literally and know your background also,
you were the CEO of Corindas, and you spent a
lot of time at Boston Scientific, which is one of
the top tier large cap medical device companies out there.
(02:53):
What experience is there helped you, you know with this
role and you know as you're going to continue to
build out avs.
Speaker 2 (03:01):
Yeah, the Boston Scientific experience was critical for a number
of factors. Primarily during the course of the roller coaster
ride of Boston Scientific, you learn how to build businesses
and then you learn how to go fix problems. And
we were a company that was a series of acquisitions
and you never knew what problems were coming your way.
(03:22):
So as a result of that experience, you were able
to come into smaller companies like Corendas, assess problems very quickly,
put teams, resources and plans in place to go solve
the problems, and eventually move your milestones up faster than
the originally thought. We got lucky at Carendas we pivoted
from the heart to the brain. The brain worked, and
(03:43):
we were fortunate enough to develop a strategy around telestroke
that appealed to several of the strategics and ended up
being sold to Siemens for one point one billion in
twenty nineteen. We've since then focused our attention on build
bilding early stage companies in the same manner, working on
(04:04):
technology that has an unmet deed, a big market and
we like the tech the text doing something that may
be different than current tech in the space. And then
once you're on that journey, you move into the tech
dev world of going to build product, you typically solving
problems along the way. Then you move into the clinical
(04:24):
trials and building evidence to support your technology, particularly with
patient outcomes, and then if all goes well, you eventually
get to the part of commercialization. So where we are
with AVS right now is moving into the clinical trial stage,
which is super exciting.
Speaker 1 (04:42):
Yeah, and I'm sure we'll talk more about where we're
going with the clinical trials, but let's start with that
unmet need. And you know, there's when you think of
lesions and the arteries, you don't think of them as
being calcified. But why is it important to distinguish between
a normal lesion and the artery and a calcified lesion.
Speaker 2 (05:06):
Yeah, So think of calcium as almost like bony like
structures inside your artery. They build up over time, and
now that patients are living longer, we're treating more complex
disease and arteries. Twenty years ago, thirty years ago, we
were treating patients in their sixties, and now we're treating
(05:26):
patients in their seventies and eighties. As you age, over time,
the calcium builds up to a structure that's very difficult
to treat because you need to crack it before you
can expand it. And one of the things that we've
done over the years is we've developed fantastic technology for implantables,
(05:50):
so stints today are standard of care. But a stint
can only expand it so much. If the calcium's in
the way, it can't open it up to restore maximum
blood flow. And that's ultimately the goal, to restore blood
flow at the ultimate level where you don't need to
go back and to retreat it down the road.
Speaker 1 (06:05):
Okay, it's almost now. It kind of giving me flashbacks
of all the times I have to clean up dry
plato on the rugs that my daughters are playing with.
It kind of sounds like that that over time, the
clogged arteries, it just hardens and then it just becomes
more difficult to treat it does.
Speaker 2 (06:21):
It's if you were to catch it earlier, it would
be more malleable, but as time goes on, it creates
structures that are very difficult to treat. And calcium, just
like your bones are made of calcium. It's essentially the
same thing. If you were to try to take a
bony structure inside an artery, you're going to need to
(06:42):
modify it before you want to try to expand it.
Speaker 1 (06:45):
And then when we think of the breakdown between the
patients that have calcified lesions and those that don't, you know,
I'm seeing numbers anywhere from thirty to sixty percent of
with clogged arteries are also calcified lesions. Is that the
right way to think about it? And what's kind of
the overall prevalence of kind of clogged arteries or the
(07:08):
market opportunity here potential for IVL.
Speaker 2 (07:12):
Well, doing heart procedures is probably the number one procedure
and really all of medicine right now. So coronary arteries
are treated about six million patients a year. Peripheral arteries
are close to four million patients a year, and of
those arteries that we treat, roughly thirty to fifty percent
(07:38):
would be highly calcified in complex lesions. So as a result,
the market's very big. If you were to do the
math on that, that's about five million patients with leg
disease as well as cornary disease or heart disease that
need some sort of calcium modification.
Speaker 1 (07:55):
Okay, and then that does bring us to the treatment options,
and maybe we can just start with the kind of
landscape before IVL and you know we're talking about now
we're having to treat these patients when they're older. The
legions are calcified. But what were the traditional standards of
care for treating these patients and why were there drawbacks
(08:17):
with those for the new calcified lesions.
Speaker 2 (08:20):
Yeah, calcified lesions have existed for years. We just didn't
have the tools necessary to do work with calcified lesions
that every physician could use. We developed tools, but the
tools were very complex to use and required high high skill.
An example would be a rotoblader device is a device
(08:42):
the Boston Scientific Manufacturers, and it would be a diamond
shaped burr that goes down the artery. Now you can
imagine a diamond shaped burr. Spinning multiple revolutions in seconds
requires a lot of skill, so people physicians were nervous
to use it that they might hurt the patient. So
(09:04):
you needed a lot of training, a lot of skill
to do it. And what happened with with intervascal lithotripsy
is it accomplished the same result as that but in
a much easier fashion to use.
Speaker 1 (09:18):
Okay, and then you know, why don't we then talk
a little bit about how you know iv L technology works.
You mentioned that it was originally used for kidney stones. Yeah,
how has that technology been able to be converted from
that treatment therapy to being able to treat the lesions
within the arteries?
Speaker 2 (09:39):
Yeah? So, IBL or lithotripsy is delivering energy to a
source that you're trying to modify. In this case, it's calcium.
So there's multiple ways to deliver energy to a source.
Shockwave uses acoustics or sound waves, and we use more
(10:04):
like hydraulics. So we're hitting the calcium about sixteen times
a second in around a peak pressure wave. That's two
to three times greater than a typical angioplastic balloon. So
an angioplastic balloon wouldn't have much impact on the calcium.
But if you're hitting the calcium at a higher peak
(10:26):
pressure with your energy source, it's going to start to
create cracks in the calcium that allows you then to
modify it. And the analogy I use for the common
person who thinks about this is if you were going
to tailgate at a Clemson Tigers football game on a
Saturday and you're trying to put ice in your cooler.
(10:46):
You go to the gas station and you get a
block ice, and the first thing you would do with
the ice would be break it up. And how would
you break it up? You don't hug it like an
angioplastic balloon would hug the artery and the calcium. You
throw it on the ground and then you roll it
over and you throw it on the ground again, and
that case, the the ice shatters and you're able to
(11:10):
then disperse the ice and mold the ice the way
that you want to. The same concept applies when you're
talking about lithotripsy delivered in calcium in arteries.
Speaker 1 (11:20):
Interesting, but you know, the one thing that I just
want to make sure though, is that what you know,
you throw the ice bag on the ground, ice shatters.
Sometimes those ice pieces break off and the you know,
they kind of scatter around around the bag. Is there
a risk of any of that calcified lesion breaking off
(11:41):
and then kind of traveling downstream to the body or
then back up to the lungs of the brain.
Speaker 2 (11:46):
Yeah, we've had to study that. And fortunately for the
human body, the calcium builds up in the medial layer,
the medium layer of the artery, and as a result,
it has the intimate layer that still lines it, which
is equivalent to the bag still holding the ice. Okay,
So fortunately for the human body, we protected against the
(12:08):
downstream effect of that based upon where calcium builds up
in the arterial wall.
Speaker 1 (12:13):
Okay, And so you know, we're we've talked a lot
about you know, Shockwaves being the first to market that
they've had great success with the launching their product. But
I noticed that you mentioned that there is difference in
the technology. You talked about shockwave being a sound wave
and you talked about your technology being the hydraulics and
(12:34):
the sixteen times per second. Why is that difference important
when you're developing your technology.
Speaker 2 (12:45):
Yeah, both technologies work. We're both delivering an energy source.
The difference is in some of the design principles. To
deliver a sound wave inside an artery, you need a
electrical admitter to create a bubble. It's called cavitation, and
the bubble pops and it pops inside the balloon, which
(13:09):
constrains that bubble, and when it pops, that's the sound
wave that's created. The emitters are electrical, so they're not flexible,
and your arteries are very twisted, so you need to
get around a lot of bins in arteries. So as
a result, the deliverability of that product is good, but
(13:31):
it could be better. And so our design principles was,
how do we help a physician treat more patients with
a more deliverable system that's easier to use. So we
eliminated all the emitters and work off of CO two
plus what we call a water hammer effect to create
(13:51):
a pulsatile energy like hydraulics. That it essentially allows the
balloon to go up and down sixteen times a second
and emit the same level of energy that a sound
wave would, but it also increases our efficiency of treatment.
Speaker 1 (14:05):
So it's the same peak pressure, just being able to
do it for a longer frequency. Is that the right
way to think about it.
Speaker 2 (14:13):
We have the same peak pressure that shock wave would have.
We will be more flexible with our cather because we
don't have emitters, and we'll also do more peak pressures
in a second, probably to the tune of about ten
times more than shock wave would do. So as a result,
we would likely be more efficient than they would be
(14:35):
in the procedure. And also, the emitters have a timeout factor,
meaning that they can only emit so many acoustical waves
before they time out and then you have to replace it.
Ours has no timeout factor. We don't have emitters, so
as a result, you could use our product as long
as you want.
Speaker 1 (14:54):
And that's that's for the generator, not the actual catheter. Correct,
that's the Oh, that's the catheter.
Speaker 2 (15:01):
Yeah, the distal end of the cather has the electrical emitters.
That's what has a timeout factor. They can do a
certain number, whereas we don't have that gating factor.
Speaker 1 (15:11):
Okay, And then for your technology as you're developing it,
are you focusing on the peripheral arteries first or the
coronary arteries first?
Speaker 2 (15:22):
Yeah, we we have a parallel passive development. Peripheral is
moving very fast and to the point where we're going
to enroll our first patient in a US ide clinical trial,
likely late August early September. We're planning on a trial
that's one hundred and twenty patients around twenty sites in
(15:44):
the United States, and we're very excited that we'll start
in September and enroll through the rest of the year.
The likely approval of that product will be sometime in
late twenty twenty five early twenty twenty six. And then
simultane so that we're in the we're in the development
stage of our Cornery product. Our Cornery product has the
(16:07):
same design principles of our peripheral product, which is a
key component of our equation. So the console or handle
and our amplifier can be used for both peripheral and
for coronary, so no change to those. And now we're
just modifying what the CATHER looks like so they can
go in smaller arteries. So the development phase for US
(16:30):
is seventy five percent complete. We're only working on the
CATHER now, so we'll be in first and humans likely
sometime in early twenty twenty five.
Speaker 1 (16:39):
Okay, that's a lot to go through, and let's go
through those kind of step by step let's start with
the perofhal because that's coming up first. Yeah, and it's
late twenty twenty five target for a US approval, right, Okay,
And so and you're going to plan to start the
IDE in September. What were some of the first in
(17:03):
human or early feasibility data that's out there. What kind
of what is that showing you as you're starting this
IDE trial.
Speaker 2 (17:11):
Yeah, there were three takeaways from our first and human.
Number one was ease of use, So the setup was easy,
the learning curve to use the product was easy, So
we felt very good about kind of our workflow. And
workflow in the cath lab is, believe it or not,
as important as the technology, so we felt really good
(17:32):
about that. The second thing that we saw is that
we treated lesions or treatment zones that were real world,
meaning they were very long. Sometimes in clinical trials you
just take the chip shots, and in this case, we
treated very long lesions successfully, which that talks about the
(17:55):
longevity of our product as well as the efficiency of
our product. And the second thing or the third thing
that we saw is it didn't matter what sort of
lesion we saw. So some lesions are concentric, they have
calcium all around the artery, and some lesions are eccentric,
they only have one hundred and eighty degree arc, so
(18:17):
it's not three sixty. And we were effective in both
lesion sets. Shockwave can't necessarily say that as well as
we can. So we felt pretty comfortable about workflow, about
our treatment times and how long we could treat lesions,
and then finally what lesion types we could treat.
Speaker 1 (18:37):
That's interesting though, with the lesion types, because I would
have thought that if the balloon is a full three
sixty around the arteries, it would cover, you know, it
would be able to you know, three sixty is bigger
than one eighty, you'd be able to get the one eighty.
But it sounds like that's not necessarily the case. So
what what is it about the eccentric calcified legions that
(19:00):
make it maybe more difficult or is that the one
that's actually the more difficult one.
Speaker 2 (19:04):
Yeah, it has to do with how we deliver energy.
So for us, we're delivering peak pressures on the surface,
so we're hitting it with the surface of the balloon
sixteen times. In a second, you have to realize that
shock wave is using sound. If we were in your
studio here with only two walls, Oh, the sound would
(19:28):
travel in different directions. It would go, it would go
to find, it would go the path of least resistance. Instead,
we have four walls around us. It works, sound works
better with four walls versus two walls.
Speaker 1 (19:40):
Yeah. No, that the light bulb went off there. And
so so now you have so you've had these initial
results from the first in human How how is the
trial designed? The ID trial designed with? Is it a
single arm study? What are the key data points that
(20:03):
you're looking for? I and I think you mentioned there
was one hundred and twenty patients going to be in
this one. Yeah, so where are some of the design
features for this trial?
Speaker 2 (20:13):
Yeah, so this trial, it's a it's a relatively simple trial,
not designed by us. Okay, So the first mover in
the space in this case, Shockwave designs their trial. So
(20:34):
when we come in as the second mover in the space,
we work with the FDA to understand if there's a
trial design that they want similar to Shockwave or different
than Shockwave. In this case, the FDA came back to
us and said, we want it just like Shockwave. So
and so it's a single arm trial. It's working above
(20:57):
the knee in lesions above the knee, and it's looking
for safety data Number one, are we causing any adverse events?
So we'll be managing that from the time of treat
all the way to six month follow up. And then
it's looking for indoluminal gain. So right now, the constriction
could be you know, twenty percent blood flow in an
(21:21):
artery that should be at one hundred percent as we
expand it. Where do we land after we treat? Are
we expanding enough to restore maximum blood flow? We saw
that in our early first and human data, so we're
pretty confident that we'll be in a really good position
to maximize the diameter to restore maximum blood flow.
Speaker 1 (21:41):
Okay, And if I remember correctly the shockwave trolley that
was after like a thirty day endpoint, correct, is.
Speaker 2 (21:47):
That they have six month follow up?
Speaker 1 (21:49):
They have six month fow up.
Speaker 2 (21:50):
Yeah, we have interoperative data we'll collect, which is right
there in the case, and then you'll follow the patient
for six months after the procedure.
Speaker 1 (21:58):
Okay. So and if you're looking at twenty twenty five approval,
I'm just trying to do my math here. Is it
gonna be a five to ten k approval. Yeah, that's right,
So give you know, maybe six to nine months, so
we could see some data potentially in early twenty twenty five.
Is that the is? Or is that that's maybe that's not.
Maybe that's too soon, given that you're going to start
(22:20):
the trial in September.
Speaker 2 (22:21):
Yeah. I would anticipate the data would likely start to
manage itself into or get communicated sometime in the fall
of twenty twenty five. Okay, we'll have all of our
application for the five ten K submission into the FDA
with our follow up and then more than likely at
(22:44):
a at whatever big meeting there is typically it's TCT
is a good example of a conference, a medical conference
where data gets presented. Twenty twenty five would be probably
a good target for us.
Speaker 1 (22:56):
That's that's good to know. Mark my calendar for that one.
Speaker 3 (23:01):
And then you know.
Speaker 1 (23:02):
One of the other things too, I know about the
shockwave is that because of the its design, it can't
be used for other functions of angioplasty. The multimodality is
is your product able to be able to do any
other functions as well? When you're when you're helping these
(23:24):
patients kind of clear their arteries.
Speaker 2 (23:26):
Yeah, that's one of the design principles that we tried
to solve when we were looking at the space. The
current product shock Wave, it's great product, does great work,
but can you do other things with it? And the
current design of their Their balloon, which is is basically
an anchor inside the artery, is a very compliant balloon,
(23:50):
so it's pretty malleable. It doesn't do much for expanding
the artery much more than the litho trips who would
break it up solo. So as a result, the physician
would need to come back in with something that could
expand the artery, so that requires them to use two devices.
We try to take that make it into one device
so that you could deliver litho tripsy first and then
(24:12):
you could use our balloon on the end of the
lithotripsy system to actually expand the lumen at the same
time or even after you delivered the lithotripsy, so you
would only need one device versus two.
Speaker 1 (24:27):
And that you know that saves time and we're talking
about the critical time within a catholas. Yeah two for one.
Speaker 2 (24:32):
Yeah, same time and cost yeah yeah.
Speaker 1 (24:36):
Anything else in the development for peripheral before we move
into coronary.
Speaker 2 (24:41):
You know, one of the things that is interesting about
this technology is because we're managing or we're we're working
with pressure waves, we're quickly able to read the pressure
wave and that gives you to benefits. Number one, if
(25:02):
the pressure wave were to change, let's say the balloon
were to rupture, you're now able to completely shut off
the system.
Speaker 1 (25:11):
Okay.
Speaker 2 (25:11):
So it has an extra safety feature for patients and
for physicians when something bad could happen. So that's one
aspect of it. The second aspect of it is that
pressure wave is creating a compliance curve. It's essentially giving
you data to say you're done with treatment.
Speaker 1 (25:31):
Oh okay.
Speaker 2 (25:32):
So that could be what we call one of the
first smart devices to ever hit the market.
Speaker 1 (25:38):
Yeah, because you're basically your balloon's not bursting, so you
can be able to say, hey, the balloon's at a
certain shape where we feel comfortable with the outcomes.
Speaker 2 (25:48):
It gives you a It gives you data coming back
from the treatment zone to be able to show that
the area you're treating has yielded.
Speaker 3 (25:57):
Yeah.
Speaker 1 (25:58):
Like I said, it just gives them much.
Speaker 2 (25:59):
Pretty interesting another data point to say, hey, I did
a safe procedure and it worked.
Speaker 1 (26:04):
Yeah, and that's you know, just helps out with the
process of for them in the cathlob to keep.
Speaker 2 (26:08):
Things moving right.
Speaker 1 (26:10):
And then just you know, moving to the cornery there
you say, you're talking about it's being seventy five percent
kind of through the comility.
Speaker 3 (26:18):
Yeah.
Speaker 1 (26:19):
One thing that caught my attention, and maybe this is
you know, is because you're talking about how there's no
electrodes and it's easy to move through those you know,
the peripheral arteries. The coronary arteries are smaller, so it's
got to be advantageous to be able to be able
to have that maneuverability and ease of use in those
arteries as well. Is that kind of one of the
(26:40):
key design features for going in the coronary artery? Is
there are there other features that kind of are you're
seen as a benefit beyond even what you're seeing in
the periferle arteries.
Speaker 2 (26:50):
Yeah. So what we've seen with stent development is that
you know, the lower profile that you make the product,
in other words, the size of the cafe it's going
to get the more places. And then secondarily, the other
thing we've learned is the more flexible you make the stint,
it's going to get the more places and likely going
(27:10):
to get there faster. So you know, our design principles
go back to that concept of Okay, if you remove
the emitters from the equation, you're not restricted by the
size of the emitters, so you can make the cathere
size smaller, which is a benefit for ease of delivery.
And then number two, because the emitters are electrical. You know,
(27:34):
electrical emitters don't bend, they're stiff, and if you remove those,
then you can get a more flexible device to go
around curves and bins in very small, little coronary heart
arteries where you're trying to treat something very distal or
further down the vessel to restore a maximum blood flow
(27:55):
and get the heart in a position where it can
recover again.
Speaker 1 (28:00):
And then just the timing around that. Right now, as
you're still working at the FDA on a potential first
and human yeah, trial, is that the right way to
think about it?
Speaker 2 (28:09):
We are we have a goal most of first in
humans and medical devices are done outside the US. We think,
because we are seventy five percent complete with our design
and we've gone through the peripheral approval of the idea
with the FDA that they're comfortable with our console, handle
(28:29):
and amplifier, and now that we're leveraging that into the
coronary trial, we'll show them are what's called V and
V verification of validation data of our catheter. They already
have and approved the other parts of the system. So
we feel pretty confident that the FDA will be interested
in bringing the first in human trial for the coronary
(28:51):
into the United States, which would be a lot of fun.
Speaker 1 (28:54):
Yeah, And because you know, actually, as you were just
saying that, I'm just thinking, you know, previous guests on
this show they've talked about a shift to doing clinical
trials in the US first over Europe, but mainly because
of the changes in the EU regulation. Does that play
a part in that as well, or was it mostly
(29:15):
just because you already have the design. You're working with
the FDA on the design for the peripheral well.
Speaker 2 (29:21):
A lot of the things that factor into the equation
are how fast your product is ready for the FDA
rigor because their requirement is high, you can go to
other countries around the world Europe excluded and have a
lower bar. You could go to countries like Australia, or
(29:42):
you could go to South America and they have a
lower bar for you to test your technology. You're right.
On Europe, they've definitely raised the bar. So they're probably equal,
if not maybe even greater than the FDA right now.
So as a result, you know, a lot of companies
are trying to find alternative countries to go do work in. We,
(30:04):
because we've already gone through the process with the FDA
for seventy five percent of our product, feel pretty comfortable
that the rigor we brought we brought to the FDA
is at a high level, so why not try And
so our first discussion with them on this topic will
be in the next thirty days. Well that'd be exciting
(30:25):
to Yeah, we'll see where it goes. Expectancy, pressure release.
We're confident with it. They'll be excited about it too.
Speaker 1 (30:31):
And so you know, actually the last thing, you know,
we talked about perifer, we talk about coronary. One of
the things that shock Wave had brought up is you know,
their development into other regions beyond that, mainly the carotid artery,
mainly even like a valvular technology before taver. Are those
any developments that you're working on as well.
Speaker 2 (30:52):
Yeah, I think we're learning a lot and Shockwave is
is helping the space because they're the pioneer, they're the leader,
and they're really investing in additional applications. So the applications
that kind of come to mind are the peripheral above
the knee, that's what we're working on. That's our trial.
There's also peripheral below the knee, so the disease that's
(31:15):
in the cafe area. That's another application that's really interesting
to us. There's the coronary art disease, which we've discussed,
so that's the third one. The fourth one is the
carotid arteries, and I'm going to come back to that
because I think that's an evolving story. And then the
fourth one is there's a lot of calcium in the
(31:37):
annulus of the aorda where we typically put valves in,
so this would be an option for breaking up that
calcium prior to evalve, or maybe even as a bridge
to evolve. So for us, we can't tackle all of
those as a small company, but we really feel excited
about peripheral above the knee. We feel excited about cornary.
(32:00):
We've obviously got plans in place there, and we've recently
been pulled into discussions on karateds so we're we're amplifying
that strategy today. And what's interesting about karateids is it
looks like there's some technology that's really showing great promise
for karated stinting and that could lead to more patients
(32:23):
getting stints in the karateid, and as a result of that,
it could lead for a demand for lithotripsy to break
up the calcium before they get the stint in the
karate versus having surgery. So we really like that space
and we're going to invest in that space in the
upcoming year. More than likely we'll start our trial probably
(32:45):
sometime in late twenty twenty five with that product.
Speaker 1 (32:48):
Okay, that's good to know as well, especially because you know,
moving to kind of the competitive landscape of IVL. I mean,
it's right now Shockwave is the only one in the market.
You're developing your product. There's large cap companies that have
discussed that they're developing theirs. How do you see the
(33:09):
competitive landscape currently and how do you see it kind
of evolving over time or is this one of those
things where you know, rising tide lifts, all boats.
Speaker 2 (33:21):
Yeah, well, any space that is a billion dollar space
is going to have plenty of interest in it. So
no surprise, there's plenty of competitors trying to solve problems.
You know. One of the things that we think about
is we think about we think about better widgets. So
there's a widget on the market today that does good work,
(33:42):
how can you make it better? And that's where we
go back to the design principles of our product. So
even if there are four or five products on the
marketplace at one point time, the idea of it is
yours easier to use? Is it? Is it a product
that physicians like to use, does have great outcomes, and
then eventually you kind of win the game. When we
(34:04):
think about what we're doing, we think we're a little
bit unique because we have a different mechanism action than
others that are creating sound waves. So you may have
a company that's doing a sound wave just like shockwave,
so me too. You may have another company that's creating
a sound wave with a laser source. Also a sound
wave and lasers are pretty difficult to work with. So
(34:29):
we really feel like we have some unique advantages with
our mechanism action that really allows us to have probably
the easiest to use intravascal lithotripsy on the market when
we get to the market.
Speaker 1 (34:41):
And so I mean and so if with that is
you're differentiating yourself from the rest of the competitive landscape,
how are you building out your patent protection or your
IP protection to be able to create that barrier from
other companies trying to develop a similar IVL.
Speaker 2 (34:57):
Yeah, it's a great, great question. And IP is so
import in all spaces, not just this one. We really
have been fortunate, you know, I give credit to a
tender germ doctor Gerham and Robert Chacina, the founders who
started filing patents and IP back at the University of Michigan.
(35:19):
So we're in a really good spot where are what
we call our secret sauce, how we actually deliver the
energy has been patented and granted. A lot of people
say we have patents that are filed, but until they're granted,
they don't really mean anything. So we have, you know,
a bulk of our product that has been granted. So
(35:41):
we feel pretty strong about our mechanism of action and
what we can protect against people who want to try
to go in that direction with what we're doing. The
the other thing that we're continuing to evolve our IP
strategy on is software. We think software and data is
the future of medicine, and as we think about software, patenting,
(36:03):
a lot of those different software components of development really
could be an important part of the equation.
Speaker 1 (36:09):
So just just I'm just thinking with software, is that
more kind of when we were talking about the smart
feature of being able to say, hey, the balloon is
full to this point, you're you've gotten to the point
of revasculizing the artery enough. Is that where you're thinking
about it with software?
Speaker 2 (36:26):
Yeah? I mean, so if you're if you're a physician
treating an artery today, the only data source you have
is a visual data source. You're looking at it in
a in a in a picture, and you're trying to
determine whether or not you're successful. Imagine you actually have
compliance data that verifies as long as as with the
image that you have been successful in treating that leision
(36:49):
and you can move to the next step. We've never
had that.
Speaker 1 (36:52):
In this space. Yeah, well, the space is only a
few years old.
Speaker 2 (36:58):
Tat treating treating calcium is been going on for a
long time. We just haven't done it that great until shock.
Speaker 1 (37:03):
A very good point. Yeah with IVL. Yeah yeah, and
so you know I've i mentioned about the IVL being
just a few years old. Start saying the next few
years out. There's a lot of developments here. It sounds
like five years from now you're going to have a
product for peripheral approved, coronary is going to be along
its way. How do you make the transition from a
(37:26):
clinical company that is, you know, developing this technology to
a commercial company. And then basically it goes back to
when we were talking about when we start off with you,
you know, using your skills from Boston Scientific and from
Corendice to be able to make this a commercialized product.
So how do you see that path plane out over
those let's say three to five years as the product
(37:47):
gets out.
Speaker 2 (37:48):
Yeah, so we'll be commercializing the peripher product in twenty six,
the croaded product in twenty seven, and the coronary product
in twenty eight. So you've got to boom, boom boom.
So three years a lot of launches. It'll be you
know a good time for ABS. The commercial aspect for
many companies our size, it's it's a. It's a complex
(38:12):
endeavor because it's uh, it's probably the most expensive thing
you'll do. So once you get to that stage, the
first thing you need is a lot of money. Yeah,
so you'll have to do a financial raise, you know,
prior to you commercializing the product. So that's number one.
You need, you know, a big, big bank account. Number
two is, uh, you need to have a network of
(38:36):
physicians and hospitals and you need to be able to
easily access them with a launch like that so that
they feel comfortable using your product and can champion your product.
Fortunately for us, having been in the space for you know,
twenty five thirty years, we know a lot of physicians
(38:57):
and we know a lot of the hospital networks. And
then the final element of this is, you know, don't
go too wide, too fast, And what I mean by
that is global launch. Stay in your biggest markets, focus
your attention there. In the US, you would take it
with a direct sales force. In Asia, particularly Japan, which
(39:18):
would be our biggest market. In Asia, you would use
a distributor salesforce and be selective on the distributor, and
then you would be really selective in Europe. Call it
the top five countries in Europe, and you would probably
use some sort of hybrid model of a direct plus
a distributor model there, so you could reduce your cash
burn allow yourself to get a revenue trajectory where you
(39:39):
could start to break even, and then the rest of
the world could come.
Speaker 1 (39:42):
Yeah, that's interesting. And also, you know, one of the
things you didn't mention, and that's because of what Chocola
has been able to do, is you don't need to
you don't need to get reimbursement set it's already there.
Speaker 2 (39:54):
Yeah.
Speaker 1 (39:55):
So that's always been the kind of you know you
used to you know, you think of it like it'd
be FDA approval, but then right after that you have
to think about reimbursement. But you already have that out there,
So it's nice. Yeah, s up there.
Speaker 2 (40:05):
I joke all the time whenever I see the shockwave guys,
I give them a big hug and say I love
you guys. Keep doing great work. Because they established the
pathway for other companies like AVS from a clinical standpoint,
they also established the market and they established the reimbursement pathways.
So a lot of the heavy lifting has already been done.
Speaker 1 (40:27):
And it's yeah, It's probably the first time I've ever
heard on one of these episodes that you would want
to give a competitor a hug.
Speaker 2 (40:33):
Yeah, of course, I love those guys. They're making avs
and other companies. Life's a lot easier the pioneers are,
you know, the pioneers and the market leaders drive markets.
Speaker 1 (40:46):
Yeah. But at the same time, what you're doing, though,
is you're being able to find aspects of a tech
new technology based off of what doctors are telling you.
When you're just making Yeah, you know, you're making an
alternative product for the doctors to choose that one if
they prefer that one.
Speaker 3 (41:05):
Yeah.
Speaker 2 (41:06):
Well, typically the first product on the market doesn't necessarily
mean it's the best product on the market over time.
So iterations and design principles and how you solve those
challenges are some of the things that we think about
in this company. And so we're not so focused and
on how fast we get to the market. We're more
focused than are we solving some of those problems that
(41:26):
our physicians are telling us about.
Speaker 1 (41:28):
Yeah, and that'll be exciting to see over the next
few years as we see the clinical data and we
see the products coming out. But Mark, thank you for
joining us today.
Speaker 2 (41:36):
Really, thanks for having Yeah. I really appreciate being here,
and thanks to you and Bloomberg for just a great
event today. Look forward to more.
Speaker 1 (41:43):
Yeah likewise, and thank you to our listeners for tuning
in today and we hope you join us for future episodes.
If you'd like to stay up to date, you can
click the subscribe button on Spotify or your favorite streaming platform.
Speaker 3 (41:54):
Take caress US must
Speaker 2 (42:26):
Bases
Host
Jonathan Palmer
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