" India is an extremely viable growing market for expansion" Wayne Paterson, CEO, Admedus
Australian Medical Technology firm Admedus focusses on developing and innovating next generation medical technologies in cardiovascular space. Its lead product CardioCel is based on its proprietary ADAPT technology. CardioCel, is currently being used by surgeons in more than 135 global centres in Australia, Europe, US, Canada, Singapore, Malaysia, Hong Kong, Middle East and North Africa Region. Primarily used in restorative structural heart repair and reconstruction, ADAPT treated tissue provides unparalleled resistance to calcification, delivering transformative repair with longterm durability that enables native cells to successfully grow and differentiate through the entire repair, without calcification or toxicity. In partnership with Syncronei Medical India, Admedus recently launched its ADAPT technology and its flagship product CardioCel in India. Speaking to BioSpectrum Asia, Wayne Paterson, CEO, Admedus, discusses the opportunities and challenges for CardioCel in the Indian market.
What are your key initiatives for the Indian market for the next few years?
In a market that encompasses a rapidly growing healthcare segment worth $158 billion, over 50 million cardiac patients and an average 280,000 babies born with a Congenital Heart Defect (CHD) - India is an extremely viable growing market for expansion. It is for this reason that Admedus has undertaken a distribution partnership with Syncronei Medical, based on their credibility and experience in the Indian regenerative technology and surgical sectors. Their expertise in a geographic region such as India, will be fundamental in ensuring CardioCelis effectively launched and properly positioned in this major emerging market.
What are the major challenges you foresee in commercializing/launching CardioCel in the Indian market?
Like any emerging market, India has some challenges with patient access and product distribution channels. Price is definitely a more volatile driver in emerging markets as sub-distributors and healthcare facilities can be opportunistic in the way they structure their charges to patients. This is a potential concern for companies doing business in India where manufacturers maintain a very low margin but patients still end up paying a higher price. Company margins can be as low as 10 per cent on major products in India with multiple steps in the supply chain typically taking 25-30 per cent margin at each level.
Companies supplying product to these markets who experience this have limited influence over the market price as the product gets further away from the company’s control in the distribution channel. Our strategy is to demonstrate the value of the CardioCel technology to Indian surgeons through our partnership with Syncronei Medical, whose network of connections with Key Opinion Leaders (KOLs) will be paramount to our success in the region. To support the launch of CardioCel in India, ADAPT inventor and Admedus Vice President of Cardiovascular Technologies Prof Leon Neethling delivered a comprehensive series of meetings and presentations with physicians in major health centres across India to demonstrate the product’s clinical applications and benefits. Admedus and Syncronei Medical are looking forward to working closely with Indian clinicians, health officials and KOLs to build productive long-term relationships focused on helping to improve the health outcomes and quality of life for Indian patients with heart disease.
Globally which are the other emerging markets that you planning to target for launching CardioCel?
Emerging markets is a key focus area for Admedus as we look to deliver our clinically superior products into regions that have large populations and a high incidence rates of cardiovascular disease. We recently launched our CardioCel 3D product in the US and Canada and sell our products in the Middle East and North Africa (MENA) region via a partnership. We’re currently pursuing opportunities for regulatory approval in China, Turkey, Mexico and Australia.
CardioCel is already marketed in North America and Europe. In comparison to American and EU markets, how do you see Asia’s market for CardioCel?
China and India represent market territories with enormous potential for Admedus to leverage as the disease incidence and prevalence in Asia is on par or higher than the US and EU depending on the indication. From a regulatory perspective, US FDA and EU approval, both establish a comprehensive standard of healthcare for worldwide regulation – one that has given Admedus a foundation understanding for our organisation’s approach to gaining regulatory approval across the region, and the value of local expert consultancies in achieving approval. We are continuing to work through the process for TGA approval in Australia which is our home market and represents an enormous opportunity for Admedus. We are hoping to secure a positive outcome in this market during 2018 and this will definitely open doors to our Asia-Pacific neighbours. Sheer population size is the main reason the Asian markets is so valuable to Admedus as the incidence rates of congenital heart disease, heart defects and cardiovascular disease increase steadily with population growth. We see a significant opportunity for patients to benefit from our unique and clinically superior products in the coming years.
Please throw some light on your expansion plans.
Admedus is listed on the Australian Stock Exchange and currently has operations across the US, EU and Emerging markets with corporate services and biomanufacturing based in Australia. We are looking to grow revenues by 60 per cent in 2018 largely due to increased utilization of the products in all territories but particularly in the US where we just signed a purchasing agreement with a major Group Purchasing Organisation. Securing regulatory approval in Australia is a major priority and will help to progress our expansion plans in other emerging markets. We are also rapidly expanding our product portfolio and are bringing to market high value 3D moulded surgical collagen solutions in areas with high unmet medical needs.
What according to you are some of the key trends driving your business in Asia?
As we operate in the Cardiovascular space we see similar trends in Asia as other parts of the world, namely that changing lifestyles and diet are leading to a higher incidence and prevalence of cardiovascular disease which require intervention. Secondly, population trends through birth rate and ageing, significantly increases the incidence of cardiovascular disease which opens a huge potential market for our products. As such, Admedus’ plans to move up the value chain with the entire platform of ADAPT products in a massive market where we can scale for long-term success.
Emerging markets such as India and China are also developing rapidly and growing affluence in these regions means more people are looking for the best options in health care, for themselves, their patients and their children and Admedus ADAPT products are the best in the world. Patients now have more access to information on the treatment options and product available in other parts of the world and this will help to drive demand and expectation for healthcare providers in these regions to offer high quality and innovative health solutions.
Lack of harmonization makes regulatory approval for medtech products difficult in Asia. Please elaborate on regulatory hurdles in Asia’s medtech space.
The main challenge to regulatory approval in Asia is that each region has its own systems, processes and regulatory requirements. For example, some markets rely on CE, FDA or TGA approvals while other markets such as China and Japan generally require registration studies. There is an absence of meaningful collaboration across health systems in Asia so each country is a new application and process to navigate which can be expensive and time consuming. Foreign companies need to seek out a clear understanding of the regulatory and reimbursement pathways, and stay up-to-date on changes. It would be beneficial to patients in the region if we could adopt an EU type of approach whereby registration is granted across the region. This would accelerate time to market and allow patients to have access to life saving treatments.
Aishwarya Venkatesh email@example.com
Wayne Paterson,CEO, Admedus«