Accumetrics CEO Measures Progress of Its Medical Diagnostics Business
Accumetrics CEO Tim Still tells me much has changed since I profiled the San Diego medical diagnostics company in 2009.
The venture-backed company makes an automated diagnostic instrument that uses a disposable test kit to measure a cardiovascular patient’s specific response to anti-clotting drugs. More than a million Americans are hospitalized each year due to heart attacks, strokes, and other complications of acute coronary syndrome, according to the American Heart Association. Millions more are prescribed clopidogrel (Plavix) each year, usually to treat atherosclerosis or after doctors have inserted a drug-eluting stent to alleviate blockage in a blood vessel.
Accumetrics initially won FDA approval for its test to measure the anti-clotting effectiveness of aspirin, and later got the okay to measure clopidogrel, abciximab (ReoPro), and eptifibatide (Integrillin).
The market today, according to Accumetrics’ Still, boils down to clopidogrel, prasugrel, and ticagrelor, which he views as the three leading anti-clotting therapies. The drugs work in similar ways (by blocking a signaling pathway that makes platelets sticky) to help prevent blood platelets from clumping together. Clopidogrel led the field by far—it was the third largest prescription drug in the U.S. last year—but is scheduled to go generic next year.
Yet patient response to each drug varies widely. Some experts estimate that 30 percent of patients don’t respond to standard clopidogrel dosing, while another 20 to 30 percent have a high platelet reaction, which is why it is essential to test how patients respond to the drugs.
Accumetrics lead diagnostic test, called VerifyNow P2Y12, is currently used to measure the anti-clotting effectiveness of clopidogrel and prasugrel. (The company has not been cleared to test ticagrelor, which was only approved by the FDA in July).
The steep price of the company’s shoebox-sized VerifyNow instrument, which is now about $10,000, has become less of a concern as the company’s sales gained traction in the U.S. hospital market, Still says. “Keep in mind that we’re a razor/razor blade business model,” he adds. In other words, after buying a VerifyNow instrument, hospitals continue to buy the cartridges needed for each test, at a price that ranges from roughly $30 to more than $60 apiece.
By the end of this year, Still says he expects that Accumetrics’ diagnostic instruments will be in 700 to 750 of 2,200 U.S. hospitals where doctors insert drug-eluting stents.
As a result, Accumetrics’ workforce has grown from 80 to about 100 employees over the past two years. And by the end of this year, Still says Accumetrics expects to generate annual revenue between $24 million and $25 million—roughly double the company’s sales in 2009. The company has raised roughly $76 million from investors, which includes Apothecary Capital, Kaiser Permanente Ventures, RiverVest Venture Partners, Arnerich Massena & Associates, PTV Sciences, and Essex Woodland Health Ventures. “By the fourth quarter of 2011, we’ll be in a position where the company begins to make money,” he says.
“We’ve really stayed true to our strategy,” Still says, “and we’ve continued to make progress. We’re one of the small diagnostics companies that has had pretty strong growth.”