11 years after its founding, and after raising a total of $42 million, colonoscopy device company GI-View has obtained FDA approval for its product, sources inform "Globes." The company, founded by Dr. Benad Goldwasser and Yossi Gross, was one of "Globes'" most promising Israeli start-up companies in 2006, but ran into difficulties because of technical challenges. It appears that the company has overcome these challenges, given the approval that has now been granted for its device.
The company now intends to begin assembling a team for direct marketing of the device to clinics in the US, say GI-View CEO Tal Simchony. For this purpose, the company will take steps to raise an additional $20 million. While it was coping with the challenges mentioned, the company raised $13 million from existing investors Israel HealthCare Ventures (IHCV), Kemper Insurance and Ziegler Meditech Equity Partners. It now plans to add new investors.
The company's Aer-O-Scope product is designed to replace existing colonoscopy devices, which consist of a semi-rigid tube with a frontal camera inserted by the doctor into the patient's intestine. These devices are then driven forward using two control knobs, and the movement is completed through a push from the rear. The great pressure exerted by the colonoscope on the intestinal walls in navigating within the intestine has the potential risk to cause tears in the intestine. Furthermore, the colonoscope "sees" only in a forward direction, and is therefore liable to miss polyps in the intestinal folds. In addition, the device is used repeatedly, has the potential risk to transmit infections.
In GI-View's product, the component entering the intestine is disposable. Its movement within the intestine is completely different; first, a balloon is inflated at the rectal end of the device to seal it, and then a balloon is inflated on the camera end of the device deep within the intestine. An air current is then initiated that pushes the internal balloon further ahead, which also moves the camera forward without damaging the intestinal walls. Another component is the lens, which facilitates real time 360° omni-directional visualization displayed to the doctor on a single screen.
Two years ago, Peer Medical, a competing Israeli company, which offers a 330° view (less than 360°, but still a significant improvement on the existing cameras), was merged into US company Endochoice, and its product became Endochoice's leading product. Simchony: "Endochoice has three cameras, and the image is displayed on three screens, which is less convenient for the doctor. Had they wanted to create a full 360-degree image, they would have needed still more cameras. It is difficult to unify the image from all the cameras on a single screen in real time without losing the accuracy of the image. We didn't add cameras; we changed the lens, so that an image from all angles would be obtained from one sensor, and an accurate image could be displayed on a single screen."
While Peer Medical merged with a company with an existing marketing network, GI-View is trying to do it by itself. Simchony: "Our business model facilitates a direct marketing system, because every sale of the Aer-O-Scope colonoscope system is followed by revenue from the disposable scanner, and generating good revenue therefore does not require a lot of salespeople. Technological developments in other areas, such as miniaturization of photography sensors and LED light bulbs, have enabled us to overcome the problems, and bring a disposable product to market.
"We don't need our own reimbursement code, because we are profitable for a clinic even if it is based on insurance reimbursement using existing screening colonoscopy codes. We can start selling immediately."
Published by Globes [online], Israel business news - www.globes-online.com - on December 4, 2014
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