Westlake Center is the place in Seattle to shop, people watch, or protest. It’s not exactly ground zero for hotshot medical device startups. But to Amp Orthopedics, the town’s downtown retail core was as good a place as any to pursue its dream of making a fortune by soothing the ailing knees and shoulders of the baby boomers.
“We got a great deal on the rent,” Eric Dremel, Amp’s CEO, said with a shrug.
Now that Occupy Seattle has disappeared from outside his window, Amp is looking to execute this year on its plan with minimal distractions. This time a year ago, it raised the first $9.5 million out of what ended up being an $18 million Series A financing from angel investors. The company is seeking to prove that its pulse radiofrequency device can help reduce pain and swelling that patients get after undergoing arthroscopic knee surgery or rotator cuff surgery. The idea is that Amp’s simple copper-wire device could help reduce the need for narcotic pain meds, and it might reduce healthcare costs by shortening hospital stays.
The opportunity is big and growing fast, as about 130,000 people a year who are estimated to get total knee replacements in the U.S., and another 650,000 get arthroscopic cleaning and smoothing procedures.
“The volume of operations is only increasing because of the boomers,” Dremel says.
Even if Amp only captures 5 percent of the potential market for knee surgeries and 7.5 percent of the potential shoulder surgeries, it could have a $75 million annual business after five years, he says. If all goes well, Amp could be selling its device for at least one of these uses before the end of 2012, he says.
The technology at Amp is pretty basic. The device combines a signal generator, a copper wire, a tiny watch battery, and a small circuit board. Ivivi Health Sciences, the San Francisco-based parent company of Amp, owns a form of the device which has been approved by the FDA since 2008 to help relieve pain and swelling in soft tissues as patients recuperate from surgery. The vision at Amp is essentially to make a customized variation of the device, which encases the copper wire in a flexible-yet-sturdy plastic bracket that a patient can easily wear on a healing knee or shoulder (without getting the wire bent out of shape.) With the new custom knee-and-shoulder devices in hand, Amp’s mission is to run clinical trials that can yield evidence compelling enough to convince doctors they need more than the usual post-operative pain meds.
Dremel comes to this project after a long career with experience in sales and marketing at Stryker, Johnson & Johnson’s DePuy unit, and an entrepreneurial stint at San Francisco-based Moximed. Tony Robins, an orthopedic surgeon who worked with Dremel previously at Moximed, has joined as chief medical officer, and Peter Coffaro, a one-time competitor of Dremel’s in med device sales, has signed on as Amp’s director of sales and marketing.
Shortly after I walked in to meet these guys, I gave them the furrowed-brow look about how in the heck a radio-frequency device is supposed to help with tissue healing. They launched into a long discussion about the device’s mechanism of action that told me I’m not the first person to give them that strange look. Robins walked me through a long explanation of how various animal studies, and human trials, have shown that pulse radiofrequency waves can increase the binding of calcium to calmodulin, a signaling molecule. That reaction leads to a cascade of effects in which nitrous oxide gets produced, increasing vasodilation (more blood flow in tissues), and decreasing production of an inflammatory protein called IL-1 beta.
This will be the year in which Amp finds out if that biochemical hypothesis really means much to people recovering from knee or shoulder surgery.
Back in December, Amp announced it was ready to start enrolling the first of 100 patients in a study that will randomly assign patients to get its device or a placebo during their recovery from total knee replacements. Since pain is notoriously tough to measure objectively in clinical trials—many studies ask patients to subjectively score their pain on a scale of 1 to 10—Amp is hoping to get some harder data that will be valuable for physicians, patients, and insurers. The main goal is to see how much the Amp device can reduce the use of morphine-equivalent pain meds over two weeks. Secondary goals of the study will look at the extent to which Amp can bring down knee swelling, range of motion, pain severity, and use of other pain medications.
Around the same time in December, Amp put another portion of its cash to work in testing its device against shoulder pain following rotator cuff surgery. That study will enroll 102 patients who are randomly assigned to get the Amp device or a placebo, with a main goal of showing Amp can reduce narcotic pain medication usage during the first week. The secondary goals include things like self-reported reduction in pain severity, and improved quality of life.
It’s possible that Amp could have the results in hand before the end of the year, Dremel says, because these are relatively short trials. There are always plenty of things that can pop up in trials, even when they appear successful on the surface. Things like whether patients find it convenient to wear the device throughout the day, or whether it’s too cumbersome, or difficult to operate. There’s always inertia to fight, in a field where physicians prescribe pain meds so much they barely give it a second thought. And there are competitors here, like Irvine, CA-based VQ OrthoCare, which makes the Bionicare—although Dremel is quick to note that patients on that device need to spend many more hours using the device before seeing its benefits.
Right now, Amp has just a small team of six people, while leaning on the parent company for basic business functions and the folks at Seattle-based Stratos Product Development for help with product design. But when I walked into their Westlake Center headquarters, I surmised there was room for at least 20. We’ll find out later this year whether Amp will be in position to fill some of those desks.