FDA Clears New Version of Tyrx’s Infection-Fighting Pacemaker Sleeve
Tyrx climbed its first big hurdle in 2008 when it began selling its first product to hospitals in the U.S. With a key green light today from the Food and Drug Administration, the Monmouth Junction, NJ-based company has a bigger goal within its grasp—becoming cash-flow positive.
The FDA today cleared the company to begin selling the second iteration of its AigisRx Antibacterial Envelope, a drug-device combination used to prevent infections in patients getting an implantable electronic cardiac device such as a pacemaker or defibrillator. The new device, which Tyrx will price at around $900 per unit, releases two antibiotics into the system over the course of seven to 10 days and dissolves completely over about 90 days, according to CEO Bob White.
Regulatory approval is the latest step 15-year-old Tyrx has taken towards generating returns for investors HLM Venture Partners, Clarus Ventures, Pappas Ventures, and the Memorial Care Innovation Fund (a strategic investment company owned by MemorialCare Health System), which have poured just over $50 million into the company. Tyrx is now tracking about $20 million in revenue annually, a more than 100 percent jump from last year, and with its new product in the fold, hopes to become cash flow positive by the end of the year. Since Tyrx has enough cash to take it to that point, the company is unsure if it will need more financing.
“It’s possible we might do an additional raise if we think we need more sales people, but at this point we haven’t made that determination,” White says.
Tyrx has about 14 people in its sales force currently but is hoping to take that to 22 or so by the end of the year, he says.
The company was founded out of technology licensed from Rutgers University in New Brunswick, NJ, in 1998, based on the notion of delivering drugs into the body by combining them with polymers that are bioresorbable, meaning the body can break them down on its own. Tyrx used that idea to target a seemingly simple, yet unmet problem: how to prevent infections that occur after medical devices are implanted into patients. Tyrx’s first tangible product is designed to protect people when they get a pacemaker or defibrillator.
By combating these potentially fatal infections—including superbugs such as methicillin-resistant S. aureus, or MRSA—Tyrx can help keep patients from long, costly hospital stays.
Patients who contract infections following implantation procedures spend an average of two extra weeks in the hospital, says White, during which time they undergo long-term antibiotic therapy, and all of the equipment inserted into the body has to be removed and replaced. White says that can add up to a whopping roughly $75,000 bill per patient. In addition, an average of between 26.5 and 35.1 percent of the people with those infections don’t survive for more than a year. That number spikes to over 50 percent after three years, Tyrx says.
“Mortality rates increase at a much more rapid rate for patients with cardiac device infections compared those who don’t,” White says.
There are about 500,000 implantation procedures per year in the U.S., he says, and roughly 1.5 million annually worldwide. Though infections occur in some 2 and 4 percent of that group, Tyrx’s believes doctors will use the product on patients they deem at “high risk” of infection. About 75 percent of patients getting a pacemaker or defibrillator have at least one significant risk factor—such as a history of infection, diabetes, or heart failure—and 60 percent of them have two.
Tyrx’s goal is to see its device used in that roughly 60 to 75 percent range of patients, though it foresees more widespread use of its next-generation version of the Aigis system.
The first version of Aigis went on the market after winning FDA clearance in 2008. The device is a small orange mesh sock that covers a pacemaker before it is surgically implanted. The device contains two antibiotics—rifampin and minocycline—that are released into the body over the span of a week to 10 days to fight off pathogens that can be introduced to the body during surgery.
Typically, patients are either given antibiotics about 24 hours before the procedure, or during the surgery via a saline solution. When they are discharged, those patients are often given a post-operative antibiotic for about a 24-hour period, says White.
“With all of those steps taken, the infection rate out there is still between 2 and 4 percent,” he says. “This technology is aimed at significantly lowering that 2 to 4 percent by 70 to 100 percent.”
White says Tyrx has sold more than 40,000 Aigis systems since it first hit the market. The product is priced at $800, giving Tyrx north of $30 million in total revenue to date.
The newest version of Aigis dissolves completely, whereas the original system is only partially resorbed and leaves a substrate that remains with the pacemaker over the long-term. That substrate can be problematic later on when a doctor needs to perform an additional procedure on a patient with a pacemaker—say, to change the battery—making surgery take more time to get rid of the remnants.
By dissolving, the new system eliminates the risk of any long-term infection that could occur by remaining in the body, according to White.
“We heard many doctors over the years saying ‘if you make the first generation technology completely resorbable, we’ll use it on the majority of our patients,’” he says. “And that is what we anticipate based on early demand.”
Long-term, Tyrx plans to apply its drug-device combination to other implantable devices, such as orthopedic devices for hips and knees, or hernia repair.
“This technology is applicable anywhere where you have significant clinical and economic consequences associated with these infections,” White says.
Tyrx is weighing the idea of either an IPO or a sale of the company but is not quite ready to pursue either despite interest from potential buyers.
“As we move into next year and have a few quarters of revenue growth under our belt we’ll explore that and see which of those two scenarios is the best,” White says. “There’s a lot of appetite out there, and candidly, we’d like to enjoy some growth for awhile.”