Companies show innovation can still be focus for the ophthalmology sector

By Larry Haimovitch

Medical Device Daily Contributing Writer

April 27, 2015

SAN DIEGO — The annual meeting of the American Society of Cataract and Refractive Surgeons (ASCRS; Reston, Virginia) took place here last week. As always, innovative technology for cataract and refractive surgery was clearly evident. These new technologies not only promise to significantly improve patient outcomes but also will boost the profitability of the ophthalmic surgeon and the manufacturers as well.

The fourth annual Ophthalmology Innovation Summit (OIS) occurred a day prior to the start of ASCRS. A plethora of interesting and highly creative private companies presented but by far the most anticipated talk was given by J. Michael Pearson, chairman of the board and CEO of Valeant Pharmaceuticals (Laval, Quebec). Valeant has grown very rapidly since Pearson became CEO nearly a decade ago, spearheaded by a voracious acquisition appetite that has seen the company gobble up a plethora of pharmaceutical and medical device companies. This buying spree has included industry icon Bausch & Lomb (B & L), which Valeant bought for $8.7 billion in cash nearly two years.

Valeant’s growth strategy has featured a dramatic cut in all operating expenditures post-acquisition, particularly R & D. It devoted a paltry 3% of its $8.3 billion in global sales in 2014 to R & D, significantly less than the typical medical device or pharmaceutical company.

Because of this operating philosophy, Pearson’s plenary luncheon talk, titled “Valeant’s Approach to Innovation,” was of great interest to the throngs of venture capitalists, investment bankers, entrepreneurs, corporate executives and physicians in attendance.

In a less than inspirational talk which was read almost word for word, Pearson asserted that “we are committed to innovation . . . we have never turned down a project because of its cost.” He further stated that internal development is important to B & L and that “my personal commitment is to listen carefully to doctors and their patients.”

Pearson also told the crowd that “. . .  innovation does not happens in the larger companies . . .It happens in the universities . . .it happens in the start-ups . . . it happens with practicing physicians. And that is our model, we want to capture innovation.”

Finally, he added,  “a lot of companies have a `Not invented here syndrome,' where their own pet projects are better no matter what. I hope we have the opposite, which is the best idea wins.”

Although he noted that Valeant has introduced 15 new products in 2014 with “many more new products in the pipeline,” most industry pundits are highly skeptical that B & L is driving innovation with its internal R & D efforts. It seems that the lion’s share of B & L’s new products are coming from the pipeline that it inherited upon completing the acquisition.

One of the most intriguing companies that presented at OIS was privately-owned Mynosys (Fremont, California). CEO John Hendrick, a veteran of the medical device industry, discussed the company Zepto capsulotomy system for cataract surgery.

A capsulotomy is an incision that opens the clear, cellophane-like capsule that wraps the natural crystalline lens of the eye. It is performed prior to removal of the lens and implantation of the intraocular lens (IOL). It is considered to be the most challenging part of the cataract removal process and many ophthalmic surgeons are unable to consistently perform it proficiently and accurately. The result of an imperfect capsulotomy is that the IOL is not properly seated and the patient’s visual outcome does not attain the targeted goal.

The introduction a few years ago of femtosecond laser-assisted cataract surgery (FLACS) systems, featuring an automated, computer-assisted method to perform a perfect capsulotomy every time, has been a boon to cataract surgery. However, a FLACS device costs approximately $450,000 and an additional $350-400 per procedure “click” fee for the physician so while it provides an excellent alternative to a manual capsulotomy, it is very costly.

The disposable Zepto system, which features precision-pulse low energy technology, is designed to quickly create an accurate and reproducible capsulotomy. It reduces procedure time relative to a manual capsulotomy, providing a safe and effective way of performing the procedure accurately every single time. Whereas FLACS also quickly performs an automated capsulotomy, its operating costs and maintenance issues are enormous.

Zepto, which is the metric unit of measurement one million times smaller than femto, is awaiting an FDA 510(k) clearance and could debut in the U.S. before year-end.

The Light Adjustable Lens (LAL), developed by privately-owned Calhoun Vision (Pasadena, California) was very positvely and prominently featured at this year’s ASCRS. Calhoun’s LAL is a revolutionary concept in the field of cataract surgery and IOLs, employing a unique post-implantation adjustments for any visual deficiencies in the initial IOL implant.

The proprietary LAL system employs a unique combination of Calhoun’s biocompatible, photosensitive materials called macromers and a customized digital light source. The photosensitive silicone LAL is quite similar to a standard monofocal IOL and is implanted using standard cataract surgery techniques.

When the patient returns for their follow-up visit, typically 17 to 21 days later, the physician assesses the refractive correction and if it is not exactly as intended pre-surgically, the lens is exposed to Calhoun’s proprietary light source for 40 to 150 seconds. This causes the macromers to react, changing the shape and therefore the power of the IOL. The LAL is the world’s first intraocular lens that can be modified post-cataract surgery, with one to two visits, with the goal of tailoring the refractive correction precisely to the patient’s individual visual requirements.  

Although cataract surgery is viewed as remarkably safe and highly efficacious, various surveys have shown that about 40% of cataract patients are dissatisfied with their results. Specifically, it has been demonstrated in many studies that about 50% of patients have a 0.5 diopters (D) shortfall from the targeted refractive goal. This may result in the need for glasses or secondary laser enhancement surgery to achieve the targeted refraction correction.

This ‘dirty little secret” of cataract surgery contrasts to the robust clinical LASIK results. It is believed that at least 85% of LASIK patients are estimated to achieve the intended refractive goal (typically 20/20) or better. Moreover, virtually all 100% are at 20/40.

At a standing room only meeting here, the company disclosed that its pivotal FDA trial, which began in June 2013, has now completed full enrollment, with a total of approximately 600 patients (400 LALs, 200 standard IOLs) in the trial. With an FDA mandated one year follow-up, final domestic approval could occur sometime during 2017.

The clinical data that has been seen to date is nothing short of stellar. To wit, Dr. William Wiley, a cataract surgeon at the Cleveland Eye Clinic and a participant in the pivotal trial reported here that 93% of the 29 patients he treated had 20/20 vision one week post lock-in. Even more impressive, 38% saw 20/16 after their lock-in. The astigmatism results were also very strong, with 97% of the patients experiencing a tremendous reduction in their astigmatism.

The enthusiasm for the LAL amongst ophthalmic surgeons who have implanted the lens is nothing short of incredible. During this symposium and other ASCRS talks, phrases like “game changer,” “paradigm shift,” “will create super vision,” “could lead to a golden age of refractive/cataract surgery.” “will change the playing field” were heard.

The market opportunity for Calhoun is huge, with approximately 3.6 million cataract surgical procedures occur performed annually in the U.S. An additional 20 million procedures are occur outside this country. Parenthetically, cataract surgery is the most commonly performed Medicare procedure. At an estimated selling price of $1000 per lens, Calhoun’s revenue could become huge.

On another note, venerable ophthalmic industry veteran Andy Corley recently became chairman of the board and Rick Heinick has just joined as CEO. The addition of these two highly-regarded executives, both formerly employed by B & L, bodes very well for the company’s future.

American Society of Cataract & Refractive Surgery 2015

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