Picking up the Pacing in Obesity: Medtronic acquires Transneuronix
Medtronic soon will be able to offer a less invasive and safer surgical alternative to gastric bypass surgery, now that it has acquired Transneuronix for $260 million. Transneuronix has developed a gastric pacing device known as Transcend, which stimulates the stomach, and it appears to affect multiple mechanisms in obesity. The device has been approved in Europe, and has been implanted in more than 700 patients worldwide. In the US, Transneuronix has completed enrollment for its pivotal clinical trial.
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Over the last 20 years, obesity has become a disease of epidemic proportions, and the prevalence of this complex disease continues to rise. Amid this epidemic, opportunities abound for companies with surgical and nonsurgical solutions, making this market one of the hottest new growth areas for medical technology companies. At this year's meeting of the American Society of Bariatric Surgery (ASBS), manufacturers showcased some of the latest surgical solutions for treating obesity and the morbidly obese.
Obesity is a multi-hundred billion dollar market ready and waiting for device developers to catch up to fill an enormous unmet need. Between the low risk, low benefit drug options for overweight patients, and the high risk, high benefit surgeries for the morbidly obese, there's a huge gap in terms of therapies. This sweet spot covers a segement of over 50 million obese patients without weight loss options. Companies with new devices for obesity hope to serve that population; the market is existing and underserved, reimbursement risk is eliminated--since many patients will pay out of pocket to have weight loss procedures--so the remaining risk revolves around technology. However, technology risk in a multi-factorial disease whose mechanisms are poorly understood is significant.