A private Tucson company formed in 2001 to take over development of a temporary artificial heart is poised to change the standard of care for patients - and potentially become a powerhouse in heart care.
In doing so, SynCardia Systems Inc. could become the next Ventana Medical Systems - a University of Arizona technology spinoff that was acquired by Swiss drug giant Roche for $3.4 billion and now employs more than 1,000 people in Oro Valley.
SynCardia's temporary Total Artificial Heart received U.S. Food and Drug Administration approval for prospective transplant patients in 2004, and the device also has been approved in Canada and Europe. More than 1,100 have been implanted worldwide.
Up to now, its adoption has been constrained by the limited availability and utility of the original power source for the heart - a pneumatic driver that is the size of a washing machine and weighs more than 400 pounds.
But by June - perhaps sooner - SynCardia expects final FDA approval of a smaller portable driver that will let patients waiting for transplants leave the hospital and live a more normal life.
The 13-pound Freedom driver already is approved in Europe and has been used in a clinical trial by 60 patients in the U.S., including 43 who were allowed to leave the hospital with the portable driver. Wider availability could make the device appealing to far more patients.
"This is becoming a worldwide product that is now considered standard care" for patients with total heart failure, SynCardia CEO Michael Garippa said. "We believe all transplant centers and all pediatric hospitals with cardiology departments will have the device on hand."
Along with approval of the portable driver, SynCardia expects to reach two more milestones this year: FDA permission to test an artificial heart small enough for women and teenagers, and approval to use its heart as "destination therapy" - a more permanent solution for patients who don't qualify for transplants because of age or illness.
Together, the approvals will set the stage for SynCardia to grow - and perhaps attract a deep-pocket buyer.
The Journey to NOW
In 1991, it looked like the once-celebrated Jarvik 7 artificial heart had reached a dead end, after federal regulators banned it amid concerns over manufacturing practices.
In stepped what was then known as University Medical Center, which acquired the technology and formed a company, CardioWest, to further develop the heart. SynCardia was formed in 2001 to commercialize the technology and continue the clinical trial. In 2008, Medicare began to cover the cost of SynCardia's artificial heart, and private insurers followed.
Now, 78 hospitals worldwide are certified to implant the device, including the University of Arizona Medical Center, the Cleveland Clinic, the Mayo Clinic, the University of Washington, UCLA, the Texas Heart Institute and the Cedars-Sinai Heart Institute in Los Angeles.
Dr. Jack Copeland, a SynCardia co-founder and former UAMC heart surgeon, said he has no doubt the Total Artificial Heart and SynCardia will succeed.
"It's really been a bit of a journey to get there, a lot of the intellectual part of this that had to take place," said Copeland, who left the UA in 2010 to become a cardiac surgery professor at the University of California-San Diego.
"There's now general acceptance - it's going to succeed."
Big market potential
Last year, SynCardia posted revenue topping $25 million, up nearly 500 percent from 2009. It did not disclose its profits.
The company has expanded its Tucson operations with a plastics lab and nearly doubled its staff in a year, to 74 employees.
"All of that pales in comparison to what happens when the three major approvals come through," said Garippa, who joined SynCardia in 2010 and was named CEO in 2011.
At about $125,000 including driver use, SynCardia's main product - the Total Artificial Heart - isn't cheap. But it can be cheaper than a long hospital stay.
"With the Freedom driver, people get to go home and stop the taxi meter of the hospital - $2,000 a day in charges - until they get a heart," Garippa said.
It's potentially a big market. About 3,100 people in the U.S. are waiting for a heart transplant on any given day, while only 2,200 donor hearts are available each year. And nearly half of those on waiting lists have been there more than a year, the Organ Procurement and Transplantation Network says.
Justin Ryder, a 35-year-old Las Vegas, Nev., resident who has battled heart problems much of his adult life, had successful surgery to replace leaky valves in 2002, but his health began to decline in 2005. He had a Total Artificial Heart implanted at UAMC on Dec. 3 and is awaiting a transplant using the new portable driver.
"I was starting to feel worse and I decided it was the right choice - I don't have that chance of sudden death any longer, because now I have a fully functioning heart," Ryder said.
The device gives him a good chance of surviving long enough to get a transplant. A recent study shows more than 80 percent of recipients survived for a year, and more than 69 percent received transplants.
The small driver enables the former semi-pro football player and father of three to exercise while he continues to await a transplant.
more can be served
While approval of the Freedom driver will help more people like Ryder, approval of the smaller Total Artificial Heart will also significantly widen SynCardia's market.
Now, a quarter of adult men and 80 percent of women can't use the heart. With both sizes available, the artificial heart will be available to most adults and some adolescents, SynCardia says.
"We've underserved women badly, and we certainly aren't prepared for the Asian Rim populations (with smaller frames) either," Garippa said.
The destination-therapy designation is perhaps even more compelling. Now, heart-failure patients who because of age or infirmity don't qualify for transplants may be given palliative, end-of-life care, Garippa said.
With a Total Artificial Heart and a Freedom driver, those patients may be able survive for years. And in some cases, Garippa said, they could get well enough for transplants.
"Our heart gives so much blood flow to the organs that the things that often make you ineligible for a transplant are reversible with time and luck, if you're not too far gone," he said.
SynCardia's journey to this point has been long and costly. Besides years in development and trials, the company has attracted tens of millions of dollars in venture-capital and private-equity investments.
Besides Copeland, SynCardia was founded by UA cardiologist Dr. Marvin Slepian and medical engineer Rich Smith, with early investor Robert Sarver. Rodger Ford and David Mackstaller of Tucson-based Anthem Equity Group joined SynCardia in 2005, built a management team and helped SynCardia raise $54 million in private-equity investment.
The company once again is in fundraising mode, to help pay for its recent expansion - including $2 million to buy equipment and rights to manufacture its own specialty plastic for the hearts, Garippa said. The company also is readying a shift to new, better valves for the heart.
But the time will come soon for SynCardia's private-equity investors to cash in, which usually is done through an initial public offering of stock or a sale of the company.
Garippa said the company prefers an acquisition, citing the high cost and distraction of preparing an IPO. He declined to say who might be interested in buying SynCardia - which Forbes magazine named one of "America's Most Promising Companies" last year - but he said there's no lack of interest.
"We are already on the radar of the biggest companies in medical devices," Garippa said. "They know who we are, and they are watching us, and when we reach a certain threshold of regulatory and footprint accomplishment, someone's going to come knocking."
Possible suitors include Minneapolis-based Medtronic Inc., which supplies the metal valves for SynCardia's artificial heart and has a major production center in Tempe. Other names floated by industry observers include Boston Scientific, St. Jude Medical and Abbott.
"I wouldn't be surprised if there were other companies with large pockets and deep distribution channels, like a Medtronic, that would be interested in purchasing it, so they could round out from soup to nuts their cardiovascular space," said Dave Fornell, editor of the Chicago-area based magazine Diagnostic and Interventional Cardiology.
What the company will fetch is unclear, but Garippa said if it reached $200 million in revenues, it could be worth $1 billion based on a common industry value multiplier of five times revenues.
There's little competition on the horizon, Garippa said. A few companies make ventricular-assist devices, which generally help weak left ventricles pump blood. But the only other biventricular - total heart - device has been Abiomed Inc.'s electrically operated AbioCor, which was implanted about 15 times during clinical trials from 2001 to 2004.
A major buyout could fuel enough growth to make SynCardia an economic engine like Ventana Medical Systems, which makes automated lab instruments and tests for diagnostics from its headquarters in Oro Valley.
There's no guarantee a buyer would keep SynCardia in Tucson, but Garippa said there's little reason to move it and lots of reasons to stay.
"I think the know-how and the low cost of capital here makes this very much a preferred location," he said. "And since no one else in the world makes this, there's no facility consolidation that makes any sense."
On StarNet: To see more photos of the artificial heart and a patient who uses one go to azstarnet.com/gallery