Best of Blog: Start-Up March 2008
This article was originally published in Start Up
Executive Summary
"Best of the Blog" is a monthly column highlighting the best of our free online content at www.windhover.com/blog. This month: A DPP-IV HeadScratcher (obesity & type 2 diabetes) tdiabetes drugs); Cardionet & The Bear (Implantable remote monitoring device); and When Life Gives you Lemons, Make Lemonade (pain drugs).
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Financing Strategies for an Overheated Device Market
At In3 West, a medical device conference held in Las Vegas recently, Windhover Information convened a panel of venture investors to ask them what's in store for device companies seeking investments in the near future, and to address one nagging question: whether or not the heady funding levels of 2007 are sustainable, or even desirable. Certainly exits have become more challenging; consolidation has removed certain would-be acquirers and the IPO market has become more demanding; no company will get out there without at least $30 to $40 million in revenues, several on the panel felt. Others were feeling the pressure of having to carry portfolio companies for even longer periods of time; more complex technologies, lag times at the FDA, and the need to get companies not only to the commercial stage but to a revenue ramp were pushing up the number of years to an exit and total investment dollars. Many were optimistic that early stage deals, exits by acquisition and other unusual phenomena would continue to happen; but selectivity was the theme of the day.
Insulin Delivery: Still Waiting to Exhale
After the commercial failure of Exubera, is inhaled insulin dead? Not at all. Exubera failed for very specific reasons: a cumbersome device, non-standard dosing, and no real clinical utility. The Exubera snafu has eroded the commercial value of inhaled insulin, but Nektar may be the best-positioned company currently competing in the inhaled insulin space. Nektar can afford to re-partner its version for less, because Pfizer has already paid for the bulk of the drug development work.
Novo Nordisk: Riding High on Diabetes
Novo Nordisk is confident that it can continue to generate strong growth from its leading diabetes franchise. Having exited oral anti-diabetics, it's betting on further innovation in insulin and on a strong entry into the GLP-1 analog space.