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Verica Sightline Marketing Plan

Summary

This document is excerpted from a business plan written for the University of Washington Medical Product Commercialization Program. The business plan was written with a team of three people including myself as one of the team leaders. The marketing section following this was written by me as my primary contribution to the project. It lays out the product marketing position and part of the business case for investment. It includes a single page marketing story intended as a hand-out at meetings and trade shows. It is the emotional link in the marketing story and is intended to draw poten-tial investors and customers into the product’s mission and brand. I also created the graphic design and industrial design content contained in the plan.

Domenic Stephen Michael Giuntoli

[email protected]/in/domenicgiuntoli206 992 3712

University of Washington Bioengineering 534, Medical Device Commercialization, Created by D Giuntoli - 1 -

VERICA SIGHTLINE® 3D Guided Needle

Biopsy System Marketing Strategy for Incorporation into the Verica Business Plan

June 2010


Summary

In 2009 the close friend of a Verica founder went through a routine recommended

screening for breast cancer. The mammogram showed suspect lesions, and a tissue

biopsy was prescribed to narrow down the possible diagnosis. She waited anxiously for

the biopsy appointment. The procedure was a core needle tissue biopsy that required

multiple insertions resulting in pain, discomfort and minor bleeding at the biopsy tracts.

The diagnosis for breast cancer was negative to the great relief of the patient. The

anxiety, waiting and hoping was exhausting for her.

There is a significant likelihood that an American woman will undergo a breast biopsy

procedure during her lifetime. When considering the emotional and physical costs to the

patient, we believe it is important to improve the reliability and safety of this minimally

invasive diagnostic procedure.

The Mission

Verica will provide healthcare with the safest and most accurate diagnostic solutions.

Verica is committed to creating affordable products for the safe, accurate and efficient

diagnosis of organ and soft tissue disease. The brand will embody the highest concern

for the health and welfare of the patient, effectiveness and ease of use for clinicians and

the efficient use of health care resources.


The Business Case

Over 3 million needle biopsies are performed in the US each year, and many require extra

insertions, multiple visits, or complications due to inaccurate placement of the biopsy

needle. The result is unnecessary pain and discomfort, tissue damage, wasted time,

stress, and unnecessary cost.

Ultrasound guided needle placement has become common, though it is typically

performed with the limited view of a 2D ultrasound image. The ultrasound probe and

needle are held in two different hands. The user makes a reasonable estimate of the

needle insertion path, inserts the needle, and then adjusts the needle position based on

the ultrasound image visual feedback. Repositioning after insertion may cause tissue

damage or complications.

The problem is partially addressed by existing products. 3D ultrasound imaging is

emerging as a method for accurate needle guidance, but is not yet widely used. Fixed

needle guides are available as third-party accessories for ultrasound probes. There is no

complete and integrated solution.

The Sightline system enables highly accurate positioning with fewer procedure steps and

reduced rate of complications. This is contrasted to ultrasound systems that are unable to

display the needle path prior to insertion.

Verica expects this new technology to become a standard tool for biopsy procedures,

providing revenue growth to $70M by the year 2015, with additional growth potential

through increased penetration of its target markets, and expansion of medical indications

to additional target organs for needle biopsies.

In addition to biopsy procedures, the technology can potentially be applied to any guided

insertion (such as needle injections and catheterization), providing opportunity for future

product line expansion using the Sightline platform technology.


Strengths

• Unique product niche • Low risk technology • Low risk regulatory path • Substantial market potential

Weaknesses

• Time to market • Low technology bar to entry • No established sales network • Long clinical adoption curve

Opportunities

• Patent fence • Recruit existing sales

channels • Recruit clinical thought

leaders • Joint agreements with a

“major” player

Threats

• Competitive interest from “majors” in sector

Sightline Platform Technology Outlook


Market Analysis

What medical problem does Verica Sightline technology solve ?

Needle tissue biopsies are a required procedure for the diagnosis of disease in many

patient conditions. Needle biopsies expose both the patient and practitioner to health

risks. The procedure may produce complications that outweigh the benefit to the patient.

Though many needle biopsy procedures are ultrasound-guided, accurate positioning

remains challenging. Inaccurate needle positioning may resulting in increased incidence

of bleeding and tissue damage. Additional insertions are sometimes required. Trauma to

adjacent organs and tissue structures is a potential complication. The product will improve

patient outcomes and reduce treatment costs by facilitating an expediant procedure with

lower risk of complications.

Over 3 million needle biopsy procedures are performed annually in the USA. At least 2

million of these will benefit from the use of the company’s product. The product is

intended for use on soft tissue where the probe can be placed on the skin surface directly

over the targeted tissue (kidney, liver, breast, pancreas).


Ultrasound guided needle biopsy, surgeon with assisting clinician.

Fine needle breast biopsy without imaging.

Complications of Needle Biopsy Procedures Needle biopsy is a frequently used procedure to diagnose diseases in soft tissues and

organs. It is considered a “minimally invasive” surgical procedure. As with any form of

surgery there are risks involved for the patient and sometimes risks to health care

practitioners (e.g. transmission of disease from needle sticks).

Ultrasound guided needle biopsy,surgeon with assisting clinician.

Fine needle breast biopsy withoutimaging.


Complications of Needle Biopsy Procedures1

1. Pain and discomfort

2. Hemorrhage (bleeding and fluid discharge)

3. Hematoma (blood blister near skin surface)

4. Biopsy induced pneumothorax (Introduction of air into thoracic structure –

e.g. from lung, kidney, or liver core needle biopsies)

5. Puncture of adjacent organs and tissues

6. Infection

7. Needle tract implantation, seeding of tumor cells along needle biopsy path.

1Needle tract implantation after percutaneous interventional procedures in hepatocellular carcinomas:

lessons learned from a 10-year experience.; Chang S, Kim SH, Lim HK, Kim SH, Lee WJ, Choi D, Kim YS,

Rhim H.; Department of Radiology and Center for Imaging Science, Samsung Medical Center,

Sungkyunkwan University School of Medicine, Seoul, Korea. Korean Journal of Radiology. 2008 May-Jun;9

(3) :268-74


Proposal for an integrated needle and ultrasound imaging probe.

The Sightline System Solution

• The Sightline system is designed to reduce complications from tissue biopsy. The

Sightline guide can be used to introduce a cauterization probe to the biopsy tract.

Cauterization techniques will sterilize the biopsy tract and minimize bleeding.

• The Sightline system has proven to improve the efficiency of biopsy procedures.

Single procedure, fewer “sticks”, less procedure time, higher patient throughput.

• The use of Sightline technology will improve the reliability of biopsy results. Guided

imagery confirms the location of the biopsy site.

• The Sightline system will efficiently and accurately acquire high quality tissue samples

for biopsy. Fewer insertions will be required to extract the required samples.


Marketing Objectives

The Verica Sightline products will deliver these brand promises:

• The health care practitioner will associate Verica Sightline products with confidence

and ease of use.

• The patient will be familiar with the technology through her clinician and associate it

with safety and accuracy.

• The healthcare system will associate Verica Sightline with high quality products and

services.

Market Size

Tissue biopsies are a routine step in the screening process for several conditions and it is

the standard for diagnosis for cancer. Biopsy procedures range in cost from $550 to $800.

There are about 1 million breast biopsy procedures per year in the United States. This

figure is produced from the following statistics:

• There are around 20 million mammograms ordered or provided at physician office

visits and hospital outpatient department visits in the United States per year.

National Ambulatory Medical Care Survey: 2006 Summary

• Less than 5% of mammograms are called back for a biopsy procedure. [Jemal A,

Murray T, Ward E, et al. “Cancer Statistics, 2005.” CA Cancer J Clin 55(1)

(2005):10-30]

The total value of breast biopsy procedures per year in the US is $550M, based on 1

million biopsies at the $550 per procedure.

The estimated size of the liver, kidney and pancreas biopsy markets in the US on an

annual basis is $250M. ( This is derived using the same cancer case/biopsy ratio from the

above case for breast biopsy: 4/1. )

The total procedure cost for breast, kidney, liver and pancreas biopsy procedures per year

in the US is approximately $800M.

Market Relationships


• The target users are pathologists, radiologists, surgeons, oncologists, general

practitioners, medical physicists, urologic oncologists. < http://www.cancer.org >

• The influencers for purchasing and specification are clinicians involved in the

diagnosis of breast health issues such as nurses, gynecologists and general

physicians. Equipment technicians and lab technicians may also be included in

this category.

• The decision makers for purchasing capital equipment such as the Verica

system are purchasing agents, hospital value review boards, clinic and hospital

administrations.

Sources of Revenue

Revenue will be derived from a combination of special-purpose guided-needle ultrasound

systems, probe-related proprietary disposables, and software upgrades. Training fees,

extended warrantees and services contracts will provide additional revenue. The probe

and software may be licensed as an OEM subsystem for integration with general-purpose

ultrasound diagnostic imaging systems.


Competition

The competition for Verica are the global players in the medical application of ultrasound

technology. The major players in the US and Europe include Siemens Medical, Philips,

and GE Healthcare. Toshiba and Chongqing are major players in Asia. The majority of

activity is in screening and diagnosis.

The global market for diagnostic imaging is large and growing. Verica is addressing a

relatively small segment of that total market that is underserved by the major players. The

global diagnostic imaging market is forecast to reach $24.6 billion in 2015 (reference:

Diagnostic Imaging Market to Grow 7 Percent by 2015 , Imaging Technology News

http://www.itnonline.net).

Our strategy includes forming a strategic partnership with one of the potential competitors.

This relationship could take the form of a joint development agreement, and is a potential

path for acquisition by the investing partner.


Verica is targeting a segment of the tissue biopsy market that

currently represents expenditures of over $800M per year on procedures performed in the United States.

“More than 550,000 ultrasound guided core needle biopsy procedures are performed

annually, primarily with spring loaded core devices. The number of diagnostic breast

biopsies is increasing every year. A report in the September 2006 issue of the Journal of

the American College of Radiology indicates a 61 percent increase in biopsy procedures

and procedure volumes going up by 101 percent among radiologists compared to

surgeons. "With 80 percent of those biopsies resulting in a negative diagnosis,"

Pearson says, "there is no reason why women should undergo procedures that are

painful or traumatic." SEPT 2006 Journal of American College of Radiology

• Substantial market potential

• Low risk regulatory path through 510(K) submission

• Established, low risk technology


Research Notes

1)

Pain (0.056-22%)

o Pleuritic

o Peritoneal

o Diaphragmatic

Hemorrhage

o Intraperitoneal (0.03-0.7%)

o Intrahepatic and / or subcapsular (0.059-23%)

o Hemobilia (0.059-0.2%)

Bile peritonitis (0.03-0.22%)

Bacteremia

Sepsis (0.088%) and abscess formation

Pneumothorax and/or pleural effusion (0.08-0.28%)

Hemothorax (0.18-0.49%)

Arteriovenous fistula (5.4%)

Subcutaneous emphysema (0.014%)

Anesthetic reaction (0.029%)

Needle break (0.02-0.059%)

Biopsy of other organs

o Lung (0.001-0.014%)

o Gallbladder (0.034-0.117%)

o Kidney (0.096-0.029%)

Colon (0.0038-0.044%)

Mortality (0.0088-0.3%)

Complications of Percutaneous Liver Biopsy

http://emedicine.medscape.com/article/1819437-treatment

2)

Percutaneous interventional procedures under image guidance, such as biopsy, ethanol

injection therapy, and radiofrequency ablation play important roles in the management of

hepatocellular carcinomas. Although uncommon, the procedures may result in tumor

implantation along the needle tract, which is a major delayed complication. Implanted


tumors usually appear as one or a few, round or oval-shaped, enhancing nodules along

the needle tract on CT, from the intraperitoneum through the intercostal or abdominal

muscles to the subcutaneous or cutaneous tissues. Radiologists should understand the

mechanisms and risk factors of needle tract implantation, minimize this complication, and

also pay attention to the presence of implanted tumors along the needle tract during

follow-up.

Needle tract implantation after percutaneous interventional procedures in hepatocellular

carcinomas: lessons learned from a 10-year experience. Chang S, Kim SH, Lim HK, Kim

SH, Lee WJ, Choi D, Kim YS, Rhim H.

Department of Radiology and Center for Imaging Science, Samsung Medical Center,

Sungkyunkwan University School of Medicine, Seoul, Korea. Korean Journal of

Radiology.

2008 May-Jun;9(3):268-74)

3)

To determine whether the increasing use of percutaneous fine-needle biopsy of

abdominal lesions is associated with an increase in serious complications, the author

updated a literature search and evaluated a questionnaire (distributed among selected

hospitals in the United States in 1986 and 1987) that followed up a questionnaire

distributed in 1983. The updated literature review revealed a total of 24 deaths and 20

needle tract seedings. The updated questionnaire revealed five deaths after 16,381

biopsies (0.031%), whereas the previous questionnaire had shown four deaths after

63,108 biopsies (0.006%). Two similar European questionnaires revealed mortality rates

of 0.008% and 0.018%, respectively. Of the total of 33 deaths, 21 involved biopsies of

liver lesions; six involved pancreatic biopsies. Seventeen of the 21 deaths after liver

biopsies were secondary to hemorrhage; five of the six deaths after pancreatic biopsies

were due to pancreatitis. Of the 23 instances of needle tract seeding, 10 occurred after

biopsies of pancreatic malignancies. The frequencies of needle tract seeding in the four

questionnaires were 0.005%, 0.006%, 0.003%, and 0.009%, respectively. Although

infrequent, serious complications may be associated with this procedure. The author

makes suggestions that may help minimize them.

Complications of Percutaneous Abdominal Fine-needle Biopsy

http://www.ncbi.nlm.nih.gov/pubmed/1984314

Smith EH. Department of Radiology, University of Massachusetts Medical Center,

Worcester 01655.


4)

Animal trial bleeding liver biopsy: http://www.youtube.com/watch?v=fWDetY1lVWU

5) Biopsy trauma http://www.youtube.com/watch?v=ZfW6XLpdMWk&feature=related

6)

Breast cancer is the most common cancer among women and the second leading cause

of cancer deaths in women in the United States. The American Cancer Society estimates

that a woman in the United States has a 1 in 7 chance of developing invasive breast

cancer during her lifetime [1]. Currently, finding breast cancer early and treating it are the

most important strategies to fight this disease. The earlier the cancer is diagnosed, the

greater the chance for successful treatment [2], since more treatment options are

available and a complete recovery is more likely.

Mammography is commonly used to look for breast disease, which is a specific type of

imaging that uses a low-dose X-ray system to detect tumors or other abnormalities in the

breast. It can be used either for screening or for diagnostic purposes in evaluating a

breast lesion. Mammography plays a key role in early detection of breast cancers, as it

can show changes in the breast up to two years before a patient or physician can feel

them. However mammographic images are not always enough to determine the existence

of a benign or malignant disease with certainty. If a finding or spot on the image seems

suspicious, patients are usually recommended for a breast biopsy procedure.

A breast biopsy is the removal of a sample of breast tissue for examination and is the only

definitive way to determine if an abnormality detected on breast examination or

mammogram is benign or malignant. Open surgical biopsy and needle biopsy are two

commonly used biopsy procedures for the diagnosis of breast lesions. Open surgical

biopsy has traditionally been used for breast cancer diagnosis. This procedure is

performed in the operating room, and requires general anesthesia. The surgeon makes an

incision in the breast and removes a tissue lump from the suspicious region. Needle

biopsy is a minimally invasive biopsy procedure for obtaining a sample from the breast

lesion. The physician makes a small skin incision through which a needle is placed into

the lesion to obtain tissue samples for analysis. 1M per year US breast needle biopsies.

…the sampling accuracy of needle biopsy is limited because only a few small pieces of

tissue are sampled in the suspicious mass, and it is very difficult to verify that the samples

are removed from the cancerous tissue site because two-dimensional imaging is used to


guide the needle into a three-dimensional mass. This results in a 1 – 7 % false negative

rate [4] and 9 – 18% of patients having to endure repeat biopsies [5,6]. In addition, about

80% of all biopsies done in the U.S. are benign (not cancerous), according to the

American Cancer Society, which means a large number of benign tissues are

unnecessarily removed.

Optically Guided Breast Biopsy1R01CA100559, Ramanujam (PI); 1R21EB002742

nimmi.bme.duke.edu/cancer.html

7)

There were almost 27,000 post-training professionally active diagnostic radiologists in the

US in 2003. In addition, there were 4000 residents, 1000 in fellowship training, and 6000

retirees. In the same year, there were 3500 post-training professionally active radiation

oncologists, 500 physicians in training, and 500 retirees.

www.acr.org American College of Radiologists

8)

“More than 550,000 ultrasound guided core needle biopsy procedures are performed

annually, primarily with spring loaded core devices. The number of diagnostic breast

biopsies is increasing every year. A report in the September 2006 issue of the Journal of

the American College of Radiology indicates a 61 percent increase in biopsy procedures

and procedure volumes going up by 101 percent among radiologists compared to

surgeons. "With 80 percent of those biopsies resulting in a negative diagnosis," Pearson

says, "there is no reason why women should undergo procedures that are painful or

traumatic."

SEPT 2006 Journal of American College of Radiology.

9)

“There were almost 27,000 post-training professionally active diagnostic radiologists in

the US in 2003. In addition, there were 4000 residents, 1000 in fellowship training, and

6000 retirees. In the same year, there were 3500 post-training professionally active

radiation oncologists, 500 physicians in training, and 500 retirees.”

www.acr.org American College of Radiologists


10)

Needle aspiration of breast cysts is a relatively benign procedure that provides great relief

to the patient, and is typically performed by obstetricians and gynecologists (Ob-Gyn),

interventional radiologists, family physicians, and breast surgeons [1–16]. Although needle

aspiration of the breast is generally considered safe, complications and injuries to the

patient do occur and range from 0.1 to 3% and include vasovagal reactions, anxiety,

procedural pain, ecchymosis at the puncture site, hematoma, hemothorax, infection,

abscess, pneumothorax, respiratory compromise, ischemic necrosis, and tumor

seeding.[17–27]. Similarly, needlesticks are one of the greatest hazards to healthcare

workers (HCW) including Ob-Gyn who perform needle breast aspiration procedures, and

the consequences of a needlestick can be career-ending [28–32]. Moreover, injuries to

patients and needlestick injuries to HCW have become intense areas for lawsuits, medical

malpractice claims, and workman compensation actions [33–39].

Arch Gynecol Obstet DOI 10.1007/s00404-008-0710-8

Integration of new safety technologies for needle aspiration of breast cysts

Randy R. Sibbitt Æ Dennis J. Palmer Æ Arthur D. Bankhurst Æ Wilmer L. Sibbitt Jr

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