Medtronic leads race for “artificial pancreas”

Medtronic Inc. first gained fame by developing devices that could zap an errant heart back into rhythm without the patient doing a thing. Now the medical device giant wants to apply the same approach to the wayward pancreas.

Earlier this month, the Food and Drug Administration approved Medtronic’s Revel technology, the company’s second-generation diabetes management system that allows patients to better monitor blood sugar levels and adjust insulin therapies.

In an interview with MedCity News, Medtronic’ssenior vice president and diabetes division head Katie Szyman said Revel is a major step toward the holy grail of medical device makers targeting the vast diabetes market: a fully automated “closed-loop” system in which sensors monitor glucose levels, advanced software crunches the data and feeds it to pumps that deliver the right dose of insulin.

Szyman said Revel is the first system to integrate sensors with the pump by alerting patients when their glucose levels fall out of a desired range. The patient can then more easily adjust the pumps accordingly. Eventually, a closed-loop system could act the same way a computer guides an airplane in autopilot mode, she said.

Medtronic estimates total out-of-pocket start-up costs for Revel to be $1,500 and $1,000 a year for consumables. The company says most government and private payers will cover the cost of insulin pumps.

Despite advances in treatment and promising research into drugs and organ replacement, diabetes remains a top health problem in the United States. As many as 3 million Americans live with type 1 diabetes, in which the immune system attacks islet cells in the pancreas, destroying the body’s ability to produce insulin. There is no cure, though Mayo recently announced a major initiative to collaborate with Minnesota companies to eventually find one.

The disease has been a boon for Medtronic, Johnson & Johnson and Abbott Laboratories, companies that make equipment like insulin pumps and continuous glucose monitoring (CGM) devices. The latter makes up an increasing share of the $8 billion “finger-stick” market and is growing at double-digit rates.

In fiscal 2009, Medtronic’s diabetes revenue jumped 11 percent to $1.114 billion, thanks to a strong surge in CGM devices, which grew 30 percent alone in the fourth quarter. The company is also reporting strong sales of Revel’s overseas counterpart, Paradigm Veo, in Europe.

But for medical device makers, the ultimate prize remains the artificial pancreas, which could cost up to $10,000 per unit. Earlier this month, the Juvenile Diabetes Research Foundation said it’s forming a consortium with Johnson & Johnson, European companies and academics to develop and test an artificial pancreas in four years.

Realizing that goal will be tricky. A diabetic’s blood sugar level can be influenced by a host of factors including diet, exercise and sleep. Companies must not only develop powerful sensors, but create a smart enough algorithm, a complex mathematical equation, to instruct the pump to deliver the right therapy based on all of this real-time information.

The system must perform near perfectly because any glitch would prove disastrous for the patient, said Joseph Galatowitsch, president and managing director of Dymedex Consulting in St. Paul, Minn.

At the same time, anything short of a fully automated system will not gain much traction in the market because patients are unlikely or unwilling to perform the required tasks of using the devices, he said.

Medtronic’s strategy is to roll out gradual improvements to Revel until it becomes a fully closed-loop system, Szyman said. The next step is to develop a system that can automatically shut down insulin therapy for two hours if blood sugar levels fall too low. Then the company will create a system that maintains a specific glucose range followed by a system that works independently at night and, finally, day.

But some experts say a closed-loop system might benefit only the most serious diabetic patients, those with complete pancreas failure. The rest could use less expensive treatments, said Dr. Harold Katz, an endocrinologist with Allina Medical Clinic in St. Paul.

“The majority of type 2 don’t need it,” Katz said. “How much better does [the system have to be compared to other treatments] to justify putting in a $10,000 device?”

What’s needed are large studies that examine the technology’s costs and benefits to patients, he said.

Szyman of Medtronic agrees. In June, at the American Diabetes Association’s annual scientific meeting, the company will release results of a randomized clinical study that compares Revel users to patients who need multiple insulin injections a day.

She says the company believes a closed-loop system can benefit all of type 1 patients and a good share of type 2.