Student Startups Cardiovate and Invictus Tackle Big Medtech Markets
[Corrected 5/14/2013, 5:20 pm. See below.] Months before she received her PhD degree last spring, Jordan Kaufmann co-founded her own company. Her first office was a shed in her backyard, but her plan was to outdo big medical device companies like Minneapolis, MN-based Medtronic (NYSE: MDT) by making one of their products obsolete.
Kaufmann’s company, Cardiovate in San Antonio, TX, has since moved to an incubator space and hopes to close on $100,000 in seed funding soon. At 29, Kaufmann is Cardiovate’s chief technology officer, and she has moved out of her backyard shed. [Note: An earlier version of this paragraph erroneously said that Cardiovate was based in Austin, TX. We regret the error.]
“It’s great, I love it,” she says of her new executive role, which may have come a bit sooner than it does for most CTO’s. “I’m probably on the younger side.”
Kaufmann’s leap from toiling graduate student to biomedical company principal owes a lot to programs set up by the University of Texas to spur students to become technology entrepreneurs. In May 2012 Kaufmann, who earned a PhD in biomedical engineering from UT San Antonio, was the first winner of the University of Texas Horizon Fund Student Investment Competition. That inaugural prize in the now-annual competition was $50,000 in seed money to launch Cardiovate.
Back when she began her graduate studies, Kaufmann also had the support of two faculty advisors who encouraged her to choose a PhD project that would address the real-world shortcomings of medical devices currently on the market. Kaufmann decided to revamp the small fabric grafts, often reinforced with metal stents, that are used to treat aortic aneurysms. These aneurysms are potentially dangerous bulges at weakened spots in the walls of the aorta—the large artery that carries blood from the heart down through the chest and abdomen. If an aneurysm tears under the pressure of pumping blood, the result could be fatal internal bleeding.
Kaufmann concluded that the polyester or Teflon grafts used to repair aortic aneurysms haven’t changed significantly since the early 1990’s.
“They’re still kind of stuck in the first-generation mentality,” she says. “They haven’t really evolved.”
Rather than using inert fabric for the graft, Kaufmann thought, why not create a tube of scaffolding material that would become colonized by the patient’s own cells, rebuilding a living section of the aortic wall?
“Let’s have something that heals itself,” she says.
This kind of tissue engineering approach has already moved into the startup mainstream. Waltham, MA-based Histogenics uses a scaffolding of collagen to coax the development of stem cells into tissue for the repair of damaged cartilage. Organovo of San Diego uses a 3-D bioprinter to assemble cultured cells into structures such as bio-engineered blood vessels.
For her PhD project, Kaufmann made prototype grafts out of a biodegradable polymer called polycaprolactone. The idea was to create a matrix where a patient’s own cells could attach and organize themselves into tissue layers something like those in the aortic wall. Using a manufacturing process tailored for the purpose, she spun the polymer material into fibers, varying the shape of the fibers within the graft.
The fibers on the inner surface of the graft are curvilinear, to attract the endothelial cells that could make up a smooth inner blood vessel wall where clots can’t stick. In the outer part of the gradient, the polymer fibers are straighter and more spread out, to accommodate smooth muscle cells that could add structural strength to the new tissue.
The polymer fibers themselves are absorbed by the body within about a year, Kaufmann says. Ideally, a durable and flexible structure of natural cells will be left behind, and this could conform to the changes in the aorta’s shape over time. Blood vessels become more “tortuous,’’ or curving, as people age, Kaufmann says. Most aortic aneurysms are found in older people, and the currently used grafts of straight, inert webbing can lose their fit inside the aorta as years pass.
With the potential for leaks, as well as the loss of “fit,” doctors must monitor patients with grafts for the rest of their lives—a costly consequence of the surgery, Kaufmann says.
In tests of her prototype in pigs, both endothilial and smooth muscle cells colonized the graft. For Kaufmann, this was enough encouragement to form Cardiovate with her faculty advisors, Mauli Agrawal, dean of the UT San Antonio College of Engineering, and Steven Bailey, head of cardiology in the School of Medicine of The University of Texas Health Science Center at San Antonio. The three are co-inventors of the graft technology, and now make up Cardiovate’s board of directors.
Kaufmann is just one of the students being propelled into the startup world by University of Texas initiatives. Daniel Mendez was a UT San Antonio senior in 2010 when he and two other undergraduates won the top prize in the university’s Center for Innovation and Technology Entrepreneurship competition. Their experimental device was a soft, gel-filled helmet designed to protect the skulls of hospitalized infants from being deformed as they rested on their beds. The prize was about $35,000 worth of professional services that supported patent filings and the formation of the company Invictus Medical in San Antonio.
“It really helped kick-start us into being a real company,” says Mendez, who was 24 when he founded the startup.
Invictus’ infant cranial support device is now in the final stages of product development, and the company’s goal is to commercialize it in 2014. Invictus will initially focus on premature babies being treated in neonatal intensive care units. The company estimates the number of such babies in the U.S. at about 500,000 a year.
Mendez, Invictus’ chief technology officer, has been joined by a CEO, CFO, COO, and vice president of sales, who each have more than 25 years’ experience in the medical device field. Invictus has raised 80 percent of its target amount in an ongoing seed funding round.
Meanwhile, Cardiovate has also been busy over its first year. Kaufmann has been rebuilding the aneurysm graft manufacturing equipment, producing prototypes, lining up parts suppliers, and perfecting the company business plan. Cardiovate is in fundraising talks with angel investors and foundations, with a target of about $700,000 to start a long-term study of the experimental graft in animals.
If Kaufmann’s aortic graft eventually succeeds in clinical trials, it would compete in a cardiovascular stent and graft market now estimated at $507 million. According to Cardiovate’s market research, approximately 1.2 million people in the US have developed an abdominal aortic aneurysm, and surgeons perform about 65,000 repairs a year.
Kaufmann sees her company as a plausible competitor to medical device giant Medtronic and other companies selling grafts to treat abdominal aortic aneurysms, including Irvine, CA-based Endologix (NASDAQ: ELGX) and Cook Medical of Bloomington, IN. But Kaufmann also sees such established device companies as potential buyers for Cardiovate if and when the startup successfully completes the first clinical trial for its graft.
For now, Kaufmann is buckling down to the long-term effort that will be required to get to that point. Her speedy launch from grad student to company executive may have prepared her for an equally fast pace of progress at Cardiovate.
“It’s been a little slower than I thought,” she says.