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Artoss, Inc. |
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January 8, 2018 Issue |
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CEOCFO MAGAZINE |
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Q&A with Paul Byerley, Managing Partner of Artoss, Inc. providing Synthetic Bone Graft Substitute for Orthopedic Procedures utilizing Nano-Sized Particles of Hydroxyapatite that Incorporates and Remodels into New Bone more readily than other Synthetics |
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Managing Partner
Artoss, Inc.
Interview conducted by: Lynn Fosse, Senior Editor, CEOCFO Magazine, Published – January 8, 2018
CEOCFO: Mr. Byerley, what is the focus at Artoss Inc. today? Mr. Byerley: Artoss is an orthobiologics business. We sell a synthetic bone graft substitute used in a variety of different orthopedic procedures. Our product, NanoBone, is used in lieu of other products that are commercially available or the patient’s own bone which is called autograft.
CEOCFO: What is different, better or less expensive? Are you referring to your NanoBone product? Mr. Byerley: There have been synthetic bone graft products available in the United States since the mid 1990s. They all have some common characteristics. However, in general, they are what you would consider an inert scaffold that allow the human body to rebuild bone in and around the graft material. If the product becomes incorporated into the new tissue it will very slowly remodel into natural bone. Unlike other synthetic bone grafts, the hydroxyapatite we use is nanocrystalline. Specifically, NanoBone utilizes nano-sized particles of hydroxyapatite that are the same size and shape that naturally occur in human bone. NanoBone incorporates and gets remodeled in to new bone much more readily than other synthetics that are currently on the market.
CEOCFO: Is synthetic in general equal to or better than natural bone or is it a matter of availability? Mr. Byerley: From the beginning the gold standard has been iliac crest bone graft. Iliac bone graft is the patient’s own bone taken from the patient’s hip. Harvesting bone from the iliac crest is time consuming and can cause complications such as infection or post-operative pain. Also, there is a great deal of variability in the quality of the bone graft harvested from a patient. These complications and issues are what created a need for synthetic products. There have been numerous synthetics that have been developed over the last 30 years. With NanoBone we have created a new class of synthetic bone graft that is new to the United States, and I think our chances of meeting with great success are very high.
CEOCFO: Would you tell us about the products? Mr. Byerley: Our main product is called NanoBone SBX Putty. NanoBone is a composite of nanocrystalline hydroxyapatite and a material called amorphous silica gel. NanoBone is in the form of small granules. In order to create a product that handles well for the surgeon, we mix the NanoBone granules with an inert carrier. We call this product NanoBone SBX Putty. The products are approved in the United States for use as a bone void filler. NanoBone is used primarily in orthopedic surgical cases. Artoss is currently working on getting clearance for NanoBone to be used in certain spinal procedures.
CEOCFO: Are the people that should now about NanoBone aware of what you have? How do you spread the word? Mr. Byerley: We got our FDA 510(k) clearance to sell NanoBone SBX in October of 2016. Commercialization started beginning in January of this year. We are still relatively early in the commercialization process. As part of this process we are setting up independent distribution throughout the U.S. Artoss is attending our first big trade show in Orlando, Florida this week where surgeons and distributors can visit our trade show booth and discuss NanoBone. Awareness of Artoss and NanoBone will continue to increase through further distribution development and additional presence at industry trade shows.
CEOCFO: What do you understand from your history in the industry about bringing a product to market? How do you stand out at a trade show when there are hundreds of other booths and other companies that think they have a great product as well? Mr. Byerley: I have done exactly the same thing with another synthetic product called Actifuse made by ApaTech. Actifuse was developed at a university in the UK and then brought to the United States starting in 2005. I was the third US hire for ApaTech. We built that business, over the course of five years, and then Baxter Healthcare bought ApaTech for 240 million dollars. Although it is twelve years later, the commercialization playbook is nearly identical. When it comes to standing out at a trade show, there may be hundreds of other booths, but no other truly differentiated, patented and new synthetic bone graft substitutes. My partners and I have been involved in the synthetic bone grafting business for many years. Over the years, we have developed countless distributor and surgeon relationships. These surgeons and distributors will seek us out allowing for engagement opportunities.
CEOCFO: Where are you with funding and partnerships? Mr. Byerley: Artoss, Inc. is a joint venture between my U.S. partner, Jim Cassidy, and I and the two German founders of Artoss, GmbH. Our German partners began selling NanoBone in Europe over 10 years ago. Jim Cassidy and I were introduced to Walter Gerike and Thomas Gerber, the founders of Artoss, GmbH several years ago. We decided that it would be a good idea to work together to bring NanoBone to the United States. Artoss, Inc. was founded in 2015 to commercialize NanoBone in the U.S. Our cash requirements are pretty modest as NanoBone did not require a lot of additional costs for development. We have done just a couple of Seed Rounds of funding. We expect to achieve profitability without any additional funding.
CEOCFO: Where does the cost of NanoBone come into play for surgeons and hospitals? Mr. Byerley: We position the product as highly differentiated. There is a value proposition to NanoBone that does not exist for a lot of our competitors. NanoBone is cleared in the U.S. to be used as a bone graft substitute. As such, NanoBone is a lower cost alternative to a number of existing products that are currently used. We have met with success in attaining hospital approvals based on our proven clinical outcomes and cost advantage to existing products.
CEOCFO: There are so many products and ideas to consider on health?. Why Artoss Inc and NanoBone? Mr. Byerley: We have a very unique, patented product. NanoBone has a unique mechanism of action. It really is the next iteration and next advance in the synthetic bone graft space. In Europe there have been over four hundred thousand cases done with this material. NanoBone is not a new product. It is only new to the United States. Surgeons have had great success with NanoBone in Europe. We are just starting to see results in surgical cases done here in the U.S. and the outcomes have been outstanding. We expect that what has been demonstrated in Europe over the past ten plus years will translate very well to the US market. We are providing the next generation product and a step up the scale in the synthetic bone graft space. That is really it in a nutshell. |
“NanoBone is not a new product. It is only new to the United States.
Surgeons have had great success with NanoBone in Europe. We are just
starting to see results in surgical cases done here in the U.S. and the
outcomes have been outstanding. We expect that what has been demonstrated in
Europe over the past ten plus years will translate very well to the US
market. We are providing the next generation product and a step up the scale
in the synthetic bone graft space. That is really it in a nutshell.”
Artoss, Inc.
Contact: James Cassidy 320-223-1732
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Paul
Byerley