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Veran Medical Technologies: Tackling the ENB Market with a Next-Generation Toolset

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by Mary Thompson

Veran Medical Technologies Inc. is positioning itself to compete head-on with Medtronic in the interventional pulmonology space with a proprietary technology it says represents the next generation in lung navigation and biopsy. Veran’s SPiN Thoracic Navigation System is a unique electromagnetic navigation bronchoscopy (ENB) system that is designed to be more accurate and userfriendly than existing, first-generation ENB systems.

One key element that sets the Veran system apart is the steerable View Peripheral Catheter, a 3.2 mm OD catheter with a 2.0 mm working channel and an electromagnetic (EM) sensor embedded into its tip. The View catheter is inserted directly into the airways, much like a standard bronchoscope. It provides full 180-degree up/down, right/left steering during the procedure and permits both electromagnetic and bronchoscopic visualization. All of the other instruments used during the procedure—including the various lung biopsy tools such as forceps, needles, and brushes—are inserted through the working channel of the View catheter and also have an EM sensor on their tips, which enables them to be tracked by the navigation system as they advance toward the lesion and during the biopsy procedure.

Unlike Medtronic’s superDimension ENB system, Veran’s SPiN system is not affected by large metal objects in the procedure room. Thus, there is no need to calibrate the room by mapping out the location of these objects. This means that the Veran system can easily be moved from room to room and used in different departments in the facility.

The SPiN Thoracic Navigation System also includes the company’s EM-sensor enabled vPad patient tracking technology, which is placed outside the body on the patient’s chest. The vPad technology enables the system to automatically register the patient’s real-time anatomy to the CT scan just prior to the procedure, and it permits 4D tracking of the patient’s respiratory movement during the procedure, throughout the respiratory cycle. To achieve patient registration with the vPad, the operator adheres the pads to the patient’s chest and simply moves the system’s electromagnetic field generator over the chest area; registration occurs automatically. That is faster, easier, and inherently more accurate than lumen registration using a probe directed into the airways, which introduces human error into the registration process, notes Veran’s CEO, Jason Pesterfield.

According to Pesterfield, the 4D patient respiration tracking technology tracks the movement of the lung and target nodule at all times during the procedure, while the firm’s Always-On Tip Tracked instruments allow the physician access to real-time navigation throughout the entire procedure, even during biopsy (unlike firstgeneration ENB systems, which require removal of the navigation catheter prior to insertion of the biopsy tools). This improves targeting accuracy, he says, and eliminates the need for secondary fluoroscopy imaging to verify positioning during biopsy.

Eliminating fluoroscopy not only reduces the time and expense of the procedure, but also spares both the patient and physician fluoroscopic radiation exposure, he points out. And, using EM navigation rather than fluoroscopy during the biopsy procedure also may improve procedural success, particularly when it comes to the smaller nodules now commonly detected on CT screening. “The challenge with fluoroscopy,” says Pesterfield, “is that it’s incredibly difficult to see a nodule under 2 cm with fluoroscopy. But using our Tip Tracked and 4D respiration technology, we’re able to get to [these] smaller nodules in the periphery.”

Moreover, because the Veran system relies on sensor-tipped instruments, it is also the only ENB system that allows the simultaneous use of electromagnetic navigation and Radial EBUS (endobronchial ultrasound probe imaging, Olympus Medical Systems), an adjunctive imaging methodology that interventional pulmonologists often use to aid in nodule imaging, lesion characterization, and biopsy.

But the biggest differentiator, according to Pesterfield, is the system’s SPiNPerc application (and associated EM tip tracked biopsy needles), which enables the operating physician to easily switch from an ENB biopsy to an EM navigation-guided percutaneous needle biopsy during the same procedure (SPiNPerc can also be employed to guide liver, kidney, and other thoracic biopsy and ablation procedures). The Veran system, notes Pesterfield, “is the only one in the world that gives lung specialists the ability to access solitary pulmonary nodules, whether they are inside or outside the airway, in a single procedure via an endobronchial and/or percutaneous approach.”  And that, he continues, “aligns very well with the new requirements of our healthcare system” by improving both procedural efficiency and patient satisfaction.

Use of the SPiNPerc application is “growing rapidly,” says Pesterfield, who notes that some 30% to 40% of bronchoscopic biopsy procedures attempted with the Veran system today end up converting to a SPiNPerc needle biopsy, and that is likely to expand further as more people are trained in the hybrid approach.

That 30%-40% conversion rate after only about a year-and-a-half on the market with SPiNPerc is “a terrific adoption rate, that speaks to the challenges physicians face” with these patients, notes Pesterfield. Having a system with the ability to do a bronchoscopic and a percutaneous biopsy during the same procedure is a huge boon for providers as well as patients, he asserts. Without this option, patients often must wait a month or two before they can be scheduled for a separate CT-guided needle biopsy if the endobronchial approach fails. And when that happens, hospitals can lose patients to other facilities, he points out.

“Simply put,” notes Pesterfield, “our goal is to give the physician the tools they need to get the patient an answer in one procedure versus multiple procedures. We want to change the standard of care to introduce better outcomes, better efficiencies, and greater patient satisfaction.”

Veran Medical Technologies was founded in 2005 as an interventional radiology device company. Pesterfield joined the firm in August 2012 after 18 years with Stryker Corp.—the last eight as Global VP for Stryker’s surgical navigation business. His vision was to focus the company on areas where the value proposition was very strong, and he found that in the lung cancer space, which he notes is “a massive market with a lot of unmet needs.” He worked with Veran’s management team to quickly reshape the company’s commercial focus toward interventional pulmonology, a move that appears to be paying off.

According to Pesterfield, Veran has posted three back-to-back record quarters and has doubled its sales over the past three years, since it launched its first ENB application for lung specialists in 2012 (the current Thoracic Navigation Platform was launched in early 2014, while the SPiNPerc needle biopsy application has been on the market for about 18 months). In fact, he asserts, Veran has recently been “replacing the [superDimension] installed based with next-generation technology and winning new system head-to-head battles at a very high rate.”

Veran will have more than 100 systems placed in the US by the end of 2015, says Pesterfield, who also notes that the company has seen a “steady increase” in system utilization rates at its sites following the endorsement earlier this year of CT lung cancer screening by CMS and the US Preventive Services Task Force. Also helping drive ENB utilization is reimbursement, which has been on the rise in the US of late, with a 25% increase in reimbursement for the bronchoscopic code in 2014 and another 10% increase in 2015. “So now [this is] a procedure that’s in the black [for US hospitals], and with SPiNPerc, it’s even more so,” he asserts (ENB systems cost anywhere from $180,000 to $230,000 in capital equipment cost, plus a per-procedure disposable cost of between $1,250 and $2,200.) As a result, says Pesterfield, the company is “going through a tremendous amount of growth right now. I’d say we’re doubling our top line every year.”

As a testament to the company’s success (and the promise of the interventional pulmonology market), Veran completed a $30.6 million oversubscribed Series D venture funding round in September, led by River Cities Capital and Versant Ventures, along with existing investors Prolog Ventures, Advantage Capital, Rex Health Ventures, 3G Capital, Dynamic Investments, and Vectis. The round brings the company’s total invested capital to date to $65.5 million.

Veran plans to use the Series D funds to help expand its commercial organization, bring new innovative solutions to the market, and invest in training and education for its customers. The ENB market is currently less than 20% penetrated in the US, Pesterfield says, and “virtually untouched internationally,” so the company is bullish on its future growth prospects. In addition to the nearly 100 systems it has sold in the US, Veran is also distributing interventional radiology systems in China and other Asian markets with “good success,” Pesterfield notes, “and is currently pursuing distribution channels in Europe and other markets” for the SPiN system.

An estimated 2.7 million lung nodules are discovered on CT annually in the US alone, notes Pesterfield, and double that number are found on a global basis. “With somewhere between eight and 20 million patients fitting the most recent guidelines for lung cancer screening, we expect to see this market increase exponentially in the coming years (see Figure 1). We are also keeping our eye on the growing interest in the endobronchial therapy market, as we continue to hear from customers and innovators that precision guidance, 4D respiration monitoring, and targeted confirmation are critical components to advancements in endobronchial therapy.”

As for Veran’s strategy to compete against the much larger Medtronic, Pesterfield views the battle as more of a next-generation innovation story, rather than a David and Goliath tale. “Just as Kodak film and Motorola Razor cell phones have gone by the wayside, so are the first-generation ENB systems. We are very excited about our future growth expectations.”

What’s happening in interventional pulmonology right now—with catheters and less-invasive devices—draws an “amazing parallel” with what happened about 20 years ago in interventional cardiology, he points out. “But I think the time frame [for interventional pulmonology] will be shorter.” The field is “starting to move out of the early adopter phase . . . but the biggest hurdle is changing the standard of care.”

This article was originally published in the December 2015 issue of “The Med Tech Strategist”. It has been republished here with permission.

About Veran Medical Technologies

Veran is a privately held medical device company headquartered in St. Louis, MO. The company’s mission is to empower physicians to diagnose cancer earlier and to enable precision therapy to save lives. In the United States, lung cancer kills more people each year than breast, prostate, pancreatic and colon cancers combined.

Veran has developed and commercialized an FDA cleared, next generation electromagnetic thoracic navigation platform called the SPiN Thoracic Navigation System®. Veran’s breakthrough technology has been adopted by leading cancer centers throughout the United States. Veran provides physicians with a full line of bronchoscopic brushes, needles, forceps and steerable catheters with tiny electromagnetic sensors embedded in the tips for precise navigation. The combination of these proprietary Always-On Tip Tracked® instruments and Veran’s exclusive patient respiratory gating technology enables physicians to accurately access lung nodules by accounting for nodule movement during patient breathing, a common challenge for lung specialists.

Another challenge lung specialists face is that approximately 40% of lung nodules lie outside of an airway, making them very difficult to reach endobronchially, and traditionally requiring an additional procedure. Veran’s SPiN Thoracic Navigation System® is the first and only FDA cleared technology that enables Pulmonologists or Thoracic Surgeons to safely and accurately access lung nodules outside of an airway using SPiN Perc®, a navigated transthoracic needle. With SPiN Perc®, Veran combines endobronchial navigation with percutaneous navigation, allowing physicians to access all lung nodules in a single procedure, regardless of nodule size or location. This eliminates the cost and risk of unnecessary procedures and empowers physicians to provide a same day diagnosis for their patients. The early diagnosis and treatment of lung cancer has been proven to save lives.

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