MedTech Summit: European Innovation Lures U.S. Investors

Posted by: Jennifer L. Schenker on November 20

Among the most compelling tech innovations are those that tackle the huge challenges of healthcare. Take the case of Munich-based Lifebridge, which has developed what promises to be the first portable heart-lung machine, a device that emergency response teams can use to help save the lives of some of the 12 million people who die each year of cardiovascular problems before they can reach a hospital.

The machine is the only one with regulatory approval that is capable of fully replacing heart and lung functions, regardless of where a patient is located, says chief executive Manfred Salat. The devices are already being sold in Austria, Italy, France, and Turkey and the company is now preparing to expand into Asia, the U.S., and Latin America. That’s why Salat was seeking venture capital and strategic partners at a MedTech Summit taking place in Switzerland November 19 and 20.

Lifebridge was playing to a packed house. The MedTech Summit, organized by the European Tech Tour Association, a not-for-profit group which connects European start-ups with capital, attracted big name U.S. investors, including Medtronic, Johnson & Johnson, Edwards Lifesciences, and Boston Scientific, as well as U.S. venture capitalists from firms like Polaris Venture Partners and Highland Capital Partners.

"Some of the biggest innovations in medical devices have come from Europe," says Oern Stuge, Medronic's president for Europe and Central Asia and a conference attendee. "Clearly if history is a prediction of the future we will be seeing more."

The summit also attracted big European investors such as Paris-based venture capital firm Sofinnova Partners and two new funds: Ares Life Sciences, a €1 billion healthcare fund recently set up by Swiss-Italian biotech billionaire Ernesto Bertarelli, and Fountain Healthcare Partners, a $75 million spin-out fund from Irish drug maker Elan Corporation's New York-based corporate venture capital group.

During the two day conference investors listened to pitches from a total of 24 companies in the areas of cardiology, diagnostics, medical intervention, artificial organ/assist, drug delivery, orthopedics, esthetics, imaging, and ophthalmology. The companies were selected from a pool of 240 potential candidates from Europe and Israel by a 22-member international selection committee. This is the first time the European Tech Tour Association is organizing a med tech conference. It plans to make it a regular event.

Historically Europe has played a very strong role in innovation of new medical technologies. For example, the electrocardiograph was invented in 1903 by Dutch physiologist Willem Einthoven, who was awarded a Nobel Prize in 1924. And Dr. Andreas Gruentzig, working at the University Hospital of Zurich in Switzerland, is credited with performing the first balloon angioplasty to open a clogged coronary artery. There are plenty of other examples, but all too often European inventors did not do a good job of capitalizing on their inventions.

That's beginning to change. "The exciting news about the med tech sector in Europe is the large number of companies that are commercializing their innovations with senior management located in Europe," says Dr. Brian Hashemi, president of the MedTech Summit.

The sector, still small in Europe compared to biotechnology, is starting to rack up success stories. Examples include the sale last month of Sweden's Liko, which makes lifts and slings for moving patients, to U.S. medical technologies company Hill-Rom for $183 million, and the 2007 sale of EndoArt, a Swiss company that makes remote-controlled implants used in the treatment of morbid obesity and other conditions, to U.S.-based Allergan for $97 million.

The MedTech summit comes as six trans-Alpine regions, representing five European countries, are formalizing the creation of the Alps Bio Cluster, a European Commission funded initiative that aims to unite research, industrial, and training resources in the medtech and biotech sectors. The effort involves France's Rhône-Alpes region, Italy's Lombardia and Piemonte regions, Austria's Tyrol region, and Germany's Bavaria and Upper Bavaria regions.