Advanced Wound Care: The Device Industry's New Billion Dollar Product Market
This article was originally published in Start Up
For some time now, investors have hated wound care. They've been scarred by past failures, most famously, the simultaneous bankruptcies in 2002 of Advanced Tissue Sciences and Organogenesis, two tissue-engineering companies targeting chronic wounds. "Show me one success," VCs tell start-ups seeking funding. Well, now there is one. Kinetic Concepts is pulling in a billion dollars in revenues from a single product in the advanced wound care market. Is it time for VCs to love advanced wound care? Five new device start-ups hope so. Three are developing therapeutic devices for chronic wounds and two are beginning in acute wound care, an emerging surgical market. (This article also appeared as "Wound Care: Medtech's New Billion Dollar Product Market," Medtech Insight November/December 2007)
You may also be interested in...
When the healing process for chronic wounds like diabetic foot ulcers stalls, something must be done to prevent infection and amputation. Out of Denmark, Reapplix APS has a bedside device for creating a three-layered biological patch out of a patient's own blood, without additives, and within 20 minutes.
Historically, wound care has been a nice tuck-in business for both large medical device and pharmaceutical companies. But that dynamic appears to be changing as advanced technologies are developed that make this sector more attractive as a growth business, evidenced by the large number of recent deals and consolidation going on in this market. The latest example of this trend is the proposed $6.3 billion deal to make publicly traded Kinetic Concepts a privately held company.
Over the past few decades, the wound closure market has seen the introduction of a number of new technologies, including a variety of surgical adhesives and glues for both external and internal use to hold tissues together and/or reinforce surgical suture or staple lines. These products address a market that encompasses over 73 million surgical wounds annually in the US alone and generated sales of over $367 million in the US last year, according to Medtech Insight's recently published report US Markets for Current and Emerging Wound Closure Technologies. The US market for surgical sealants and glues is growing at an annual rate of about 3.8% and is expected to reach about $443 million in sales by 2013.