Search This Blog

Monday, September 2, 2019

CRISPR interference to fat cells aids v. obesity, inflammation, insulin resistance

Abstract

Obesity is an increasing pathophysiological problem in developed societies. Despite all major progress in understanding molecular mechanisms of obesity, currently available anti-obesity drugs have shown limited efficacy with severe side effects. CRISPR interference (CRISPRi) mechanism based on catalytically dead Cas9 (dCas9) and single guide RNA (sgRNA) was combined with a targeted nonviral gene delivery system to treat obesity and obesity-induced type 2 diabetes. A fusion peptide targeting a vascular and cellular marker of adipose tissue, prohibitin, was developed by conjugation of adipocyte targeting sequence (CKGGRAKDC) to 9-mer arginine (ATS-9R). (dCas9/sgFabp4) + ATS-9R oligoplexes showed effective condensation and selective delivery into mature adipocytes. Targeted delivery of the CRISPRi system against Fabp4 to white adipocytes by ATS-9R induced effective silencing of Fabp4, resulting in reduction of body weight and inflammation and restoration of hepatic steatosis in obese mice. This RNA-guided DNA recognition platform provides a simple and safe approach to regress and treat obesity and obesity-induced metabolic syndromes.
Article, supplemental material, and publication date are at http://www.genome.org/cgi/doi/10.1101/gr.246900.118.

Bariatric Surgery Tied to Better Cardiometabolic Health Down the Road

On top of helping obese patients with diabetes achieve their short-term weight and glycemic goals, bariatric surgery may be linked to improved overall cardiometabolic health years later, a retrospective cohort study found.
The cumulative incidence of all-cause mortality, coronary artery events, cerebrovascular events, heart failure, nephropathy, and atrial fibrillation was 30.8% at eight years for patients who underwent metabolic surgery and 47.7% for controls who only got usual care (adjusted HR 0.61, 95% CI 0.55-0.69).
Surgery’s apparent clinical benefit was reinforced by each individual component of the primary endpoint, along with the secondary outcome of combined MI, ischemic stroke, and mortality. Of note, all-cause mortality alone was reduced by approximately 40% (10.0% vs 17.8%, adjusted HR 0.59, 95% CI 0.48-0.72), according to Ali Aminian, MD, of the Cleveland Clinic.
He presented the study at a late-breaking trial session here at the annual European Society of Cardiology meeting. A detailed report was also published online in JAMA.
“We speculate that the lower rate of MACE [major adverse cardiovascular events] after metabolic surgery observed in this study may be related to substantial and sustained weight loss with subsequent improvement in metabolic, structural, hemodynamic, and neurohormonal abnormalities,” Aminian’s team wrote.
This is supported by the surgical cohort losing over 20 kg (44 lbs) more in weight over controls, their 1.1% greater reduction in HbA1c levels, and a lesser need for medications to treat diabetes and cardiovascular diseases over a median 3.9 years of follow-up, the authors continued.
“In 2019, for obese patients with diabetes, what is the best treatment option? The results from drug studies, although of relatively high quality, suggest limited effect on long-term macrovascular outcomes,” according to JAMA Deputy Editor Edward Livingston, MD, a surgeon at UCLA, in an accompanying editorial.
“When balancing the imperfections in the evidence for both medical and surgical treatment of diabetes, the many benefits associated with bariatric surgery-induced weight loss suggest that it should be the preferred treatment option for carefully selected, motivated patients who are obese and have diabetes and cannot lose weight by other means,” he said.
The observational study is not the first to report a significant association between bariatric surgery and lower risk of mortality and other complications of diabetes. However, it is notable for showing this in patients with more moderate obesity (BMI 45.1 and 42.6 in surgical and non-surgical cohorts, respectively).
Additionally, only those who underwent contemporary metabolic surgeries in 1998-2017 were counted: Roux-en-Y gastric bypass (63%), sleeve gastrectomy (32%), adjustable gastric banding (5%), and duodenal switch in the remaining few.
“Currently available studies have examined a limited number of cardiovascular outcomes, studied patients at low-to-moderate risk, included primarily patients with severe obesity, and in some studies included patients who underwent surgical procedures no longer commonly performed,” according to Aminian and colleagues.
For the study, 2,287 obese adults with type 2 diabetes who underwent metabolic surgery within the Cleveland Clinic Health System (Ohio or Florida centers) were matched 1:5 to nonsurgical patients. After matching, the two groups generally shared similar baseline characteristics: just under two-thirds were women, and median age was around 53 years.
“The difference to prior studies is that these patients were well matched also regarding underlying comorbidities and to some degree also medication use. To my knowledge, no studies [have been] able to match patients to such a granular level,” commented Adrian Billeter, MD, PhD, of Universität Heidelberg in Germany.
On the other hand, Livingston argued that the matching could have been even more precise; he cited the slightly younger age of the surgical arm as an example (52.5 vs 54.8 years).
“Despite careful propensity matching, these sorts of imbalances always persist in observational studies, highlighting the limitations of interpreting comparisons made between groups in such studies,” according to the editorialist.
The study’s design therefore leaves room for potential residual confounding in the analysis. The dataset may also have been subject to coding errors.
This means the results should be confirmed in further randomized trials, the investigators acknowledged.
In the meantime, Billeter said that the findings confirm prior studies (including a recent meta-analysis by his own group).
“Therefore, the impact should be that metabolic surgery should play a much more central role, I would even propose the primary therapy for patients with metabolic diseases and a BMI >30 kg/m2,” he told MedPage Today in an email.
“Unfortunately, metabolic surgery still remains vastly underutilized and general practitioners, endocrinologists, and patients need better and clear[er] information about the health benefits of surgery,” according to Billeter. “They mainly need to know how dangerous obesity and metabolic diseases are!”
The study was supported in part by a Medtronic grant.
Aminian and Livingston disclosed no conflicts.
LAST UPDATED 

Lifestyle, not genetics, explains most premature heart disease

Physical inactivity, smoking, high blood pressure, diabetes, and high cholesterol play a greater role than genetics in many young patients with heart disease, according to research presented today at ESC Congress 2019 together with the World Congress of Cardiology.(1) The findings show that healthy behaviours should be a top priority for reducing heart disease even in those with a family history of early onset.
“Genetics are an important contributor to premature heart disease but should not be used as an excuse to say it is inevitable,” said study author Dr Joao A. Sousa of Funchal Hospital, Portugal.
“In our clinical practice, we often hear young patients with premature heart disease ‘seek shelter’ and explanations in their genetics/family history,” he added. “However, when we look at the data in our study, these young patients were frequently smokers, physically inactive, with high cholesterol levels and high blood pressure – all of which can be changed.”
The study enrolled 1,075 patients under 50, of whom 555 had coronary artery disease (known as premature CAD). Specific conditions included stable angina, heart attack, and unstable angina. The average age was 45 and 87% were men. Risk factor levels and genetics in patients were compared to a control group of 520 healthy volunteers (average age 44, and 86% men). Patients and controls were recruited from the Genes in Madeira and Coronary Disease (GENEMACOR) database.
Five modifiable risk factors were assessed: physical inactivity, smoking, high blood pressure, diabetes, and high cholesterol. Nearly three-quarters (73%) of patients had at least three of these risk factors compared to 31% of controls. In both groups, the likelihood of developing CAD increased exponentially with each additional risk factor. The probability of CAD was 3, 7, and 24 times higher with 1, 2, and 3 or more risk factors, respectively.
All participants underwent genome sequencing. These data were used to develop a genetic risk score containing 33 variants thought to contribute to CAD or risk factors such as high blood pressure. The average score was higher in patients than controls. The score was also an independent predictor for premature CAD. However, the contribution of genetics to risk of CAD declined as the number of modifiable factors rose.
Dr Sousa said: “The findings demonstrate that genetics contribute to CAD. However, in patients with two or more modifiable cardiovascular risk factors, genetics play a less decisive role in the development of CAD.”
He concluded: “Our study provides strong evidence that people with a family history of premature heart disease should adopt healthy lifestyles, since their poor behaviours may be a greater contributor to heart disease than their genetics. That means quit smoking, exercise regularly, eat a healthy diet, and get blood pressure and cholesterol levels checked.”
###
Authors: ESC Press Office
Mobile: +33 (0) 7 8531 2036
Email: press@escardio.org
The hashtag for ESC Congress 2019 together with the World Congress of Cardiology is #ESCCongress
Funding: No funding.
Disclosures: No conflicts of interest to declare.

Why the AMA is helping to launch a new insurer for seniors

As a bunch of tech startups get massive funding to reshape the future of healthcare, the American Medical Association is not sitting idly by. Instead, it’s investing in and building up companies that align with its agenda. The latest is Zing Health, a new insurer focused on Medicare recipients.
In 2015, the AMA launched Health2047, a for-profit incubator that builds health tech companies. In the years since, it’s launched three such startups: a data platform called Akiri, a company focused on managing and reversing pre-diabetes called First Mile Care, and now Zing Health. Zing’s plan will give seniors access to a network of clinics in Cook County, Illinois, starting in January. The company hopes to expand to three states by 2022. It’s a managed care plan, which means the Centers for Medicare and Medicaid Services (CMS) will pay a single monthly fee per member in exchange for a more holistic approach to nurturing patient health. Zing is working with a network of community health centers, including Oak Street Health, which recently raised $65 million for its senior-focused facilities.
“This is the hottest space within Medicare,” says Zing Health CEO Eric Whitaker, whose company has raised $3 million in seed funding. “The federal government would love if we were all Medicaid managed care. From a policy perspective, they would know how much to write a check for every year. With fee-for-service Medicare, it’s an open-ended checkbook.”
Whitaker is a primary care doctor by training—he ran the Illinois Department of Health between 2003-2007–but he’s also an entrepreneur and the founder of investment firm TWG Partners. His goal with Zing is to coax community health centers to expand into tele-health and more specialized medicine in addition to basic primary care. He also wants Zing to play an active role in managing patient health, ensuring that information is handed off to doctors appropriately. For example, if patients go to the hospital, Zing will make sure their primary care doctor is informed.
The company will also assist patients with some of the minutiae of getting healthier. This includes coordinating travel to and from doctors’ appointments, providing access to healthy foods, and making sure patients are taking their medications.

THE PROFIT MOTIVE

Medicare’s managed care plans, also known as Medicare Advantage plans, are so hot right now for an understandable reason: They’re very profitable. Analysis from the Henry Kaiser Family Foundation found that insurer margins for a person on a Medicare Advantage were double that of a person on an individual or group plan. Under this payment plan, if an insurer keeps a patient healthy, it can pocket the difference between the monthly fee it receives from CMS and the services a patient uses.
There is also an upside for patients. Managed care programs untether doctors from the fee-for-service model, allowing them to develop a preventative and more holistic healthcare practice. However, there are also downsides. If the fee that CMS pays out doesn’t cover a patient’s annual healthcare costs, the insurer loses money.
“The things we would be interested in and would be hesitant about in some [Medicare Advantage] programs are things like . . . where the plan uses prior authorization as a means to inhibit therapies and save money,” says James Madara, CEO of the AMA. In the past, insurers have aggressively forced patients to get pre-approval to ensure a procedure or treatment is medically necessary in order to control costs. This not only limited patients’ ability to get the care they needed, it also prevented doctors from earning money from pricey treatments.
Managing care for patients, especially when accounting for social barriers that prohibit them from staying healthy, is expensive when it’s done well. “Everyone’s been trying to bend the cost curve, which has actually been bending a bit lately,” says Linda Green, faculty director of the Healthcare and Pharmaceutical Management Program at Columbia University. The most recent experiments, she says, have involved using care coordinators or health coaches who aren’t licensed or certified—and therefore get paid less—to manage matters such as patients’ doctors’ appointments and nutrition. Zing has plans to put staff in the community health centers it works with to perform just this function.
As for why the American Medical Association is involving itself in insurance, the organization is keen to have an insurer in the market that prioritizes doctors. Another reason, says Green, “I think they’ve been seen as a fussy old organization.”
In recent years, the AMA has had internal struggles over whether to embrace more patient-first health paradigms such as integrated medical care (a less siloed approach to treating patients) and single-payer health systems like Medicare for All. At its heart, the AMA is a physician organization, and many of its policies reinforce a doctor’s ability to get paid. But younger generations are pressuring it to think more progressively about patient healthcare. Although the AMA still does not officially support a single-payer system—because of a perception that doctors would be paid less under government-run healthcare—its policy-making board is nearly split on the issue.
By backing an insurer that allows for more patient-forward medical practices, the AMA may be attempting to show it is not a regressive organization. “Perhaps by moving in this way they can be seen as more cutting-edge,” says Green.

Engineers Captivating Pharma Make Cells, Not Software

There’s an old saw about bacon and eggs: the chicken, it is said, is involved in the dish, but the pig – he’s committed.
This framing may offer an apt description of pharma’s relationship with software and biotech engineers, as R&D leaders appear keen to leverage data science and digital technology, but seem to be placing their most substantive bets on emerging biological technologies like cell therapy.
Janelle Anderson, Chief Strategy Officer of Century Therapeutics (Photo Credit: L. Ladd/Ginger Fox Photography)
In the world of early-stage life science, where I sit, it is positively staggering to contemplate what passes for commonplace in today’s world of engineered biology. I am reminded of this regularly as my venture team* & I review the latest opportunities, or when I’m at a conference (like the annual meetings of the American Society for Cancer Research [AACR] or the American Society of Gene and Cell Therapy [ASGCT]), or when I’m fortunate enough to listen to Janelle Anderson on a podcast. This used to be easy enough, when she hosted the outstanding “Human Proof of Concept” podcast, but has been a challenge since she put this must-listen show on hold and disappeared into a VC firm to serve as an entrepreneur-in-residence.
 
 
Happily, Anderson has resurfaced – not only as the Chief Strategy Officer of the recently-announced Century Therapeutics (I am not an investor), a cancer cell therapy startup that launched this summer with an eye-popping $250M in the bank, but also as a guest on Luke Timmerman’s always-excellent Long Run podcast.
The whole podcast is captivating, as Anderson describes her journey from Manitoba to McGill to Harvard to BCG to Merck to Versant to Century (and I’m sure I’ve left out a few stops along the way). As I listened to her description of the bioengineered therapeutics envisioned at Century, it occurred to me just how far we’ve come, and how much we now routinely take for granted, and I thought it might be helpful to go over (at a high level) some of these concepts and approaches.
The I/O Scientific Revolution
First some context (see also this fairly recent Wall Street Journal review and the two books I discuss therein): after years where cancer therapeutics focused almost exclusively on removing the tumor (where feasible) with surgery, or zapping it with chemicals or radiation – the so-called cut/poison/burn palate of options -- recent work reawakened medicine to the possibility that the body has the ability to attack cancer using the cells of the immune system, insight that ushered in the immuno-oncology (I/O) revolution of today. Our immune system, it turns out, is engaged in a constant battle against cancerous cells that are continuously popping up, and which the immune system (mercifully) is usually able to destroy. But sometimes – for a range of reasons that are the subject of intensive research – the cancer seems to escape control, in part by doing whatever it can to avoid or mitigate immune system attack. The essence of multiple recent insights is the discovery of ways to help restore the balance. Much of this focus has been on ways to reengineer one of the key elements of the immune system, the “effector T cell,” which is responsible for killing cells it recognizes as being cancerous.
The gist of the approach Anderson described at Century – and of related approaches researchers and startups are exploring globally – is to turn a cell that already is predisposed to assassination and equip it to be a Delta Force commando.   The amazing thing is that you can actually engineer a cell this way (or at least plausibly aspire to), and contemplate dialing-in so many different functionalities, as Anderson almost casually outlines. Her description of Century offers a prismatic example of what state of the art in immune-oncology cell therapy looks like today.
The Commercial I/O Landscape
Let’s start with a quick review of the commercial history of immune-oncology.   The recognition that our immune system has remarkable potential to fight cancer – research recognized by the Nobel Assembly last year -- led to the development of FDA-approved therapeutics that work by juicing our existing cells, essentially by blocking the “stand down” order that ordinarily restrains the attack. This category of drug, called “checkpoint inhibitors,” includes: ipilimumab (Yervoy, first approved in 2011, marketed by BMS); pembrolizumab (Keytruda, 2014, Merck --see here for a history of how this drug was discovered and developed); nivolumab (Opdivo, 2014, BMS); atezolizumab (Tecentriq, 2016, Genentech/Roche); avelumab (Bavencio, 2017, EMD Serono), durvalumab (Imfinzi, 2017, AstraZeneca); and cemiplimab-rwlc (Libtayo, 2018, Sanofi/Regeneron). All of these drugs are engineered antibodies, examples of the category of medicines called “biologics,” in contrast to small molecules, like statins.
A second category of therapeutics takes a far more radical approach to revving up the immune system, and involves removing the relevant immune cells (T cells, specifically), reengineering them in some way, then placing them back in the body. The most prominent commercial examples in this category are tisagenlecleucel (Kymriah, 2017, Novartis), and axicabtagene ciloleucel (Yescartia, 2017, Gilead* following acquisition of Kite). Both of these marketed products involve a version of genetic engineering in which the DNA required to make a new kind of molecule is inserted in T cells; this molecule, called a “chimeric antigen receptor” or simply, “CAR” (the engineered T-cell is called a “CAR-T”) is designed to sit on the surface of T cells, recognize a unique target on a tumor cell, and when it sees it, to activate the T cell to strike.
There are many detailed reviews of CAR-Ts available; I stumbled across this particularly useful one from Nisarg Patel. Also, although not the focus of this post, there’s considerable research – and investment -- into the engineering of other types of immune effector cells, including NK cells and macrophages, for the treatment of cancer. Modulation of another type of T cell, called Tregs, which depress effector T cell activity, is also the subject of intensive investigation – not only in cancer, but also in a range of autoimmune indications (useful reviews hereherehere).
Next-Gen I/O Problems To Be Solved
With this history in mind, we can begin to better appreciate Anderson’s discussion of Century. The general goal – of both Century and so many in the field – is to build on what works with first-generation CAR-T approaches, and to fix, or at least mitigate, some of the challenges.
For starters, a challenge with first-generation CAR-T approaches is the need to engineer custom cells for each patient, the inevitable consequence of “autologous” cell therapy that uses the patients’ own cells. An often-discussed goal among many in the field is to generate so-called “off the shelf” cells, cells that could be compatible with any patient, and so ideally, you could think of them like any other drug product, where you manufacture a large batch in advance, parcel it out, and use as needed. Easy to say, of course, but much harder when the drug product is a living cell.
The approach Century (and others) are using involves a type of stem cell called an “induced pluripotent stem cell,” or “iPSCs.” The power of iPSCs is that they have the potential to differentiate into virtually any cell type; yet, in contrast to embryonic stem cells (ESCs) which have essentially the same property, iPSCs are not derived from embryos, and thus are free from many of the legal, ethical, and political considerations with which ESCs are freighted. iPSCs instead come from specialized cell types that have been returned to the stem cell-like state by the addition of a specific chemical cocktail; Shinya Yamanaka* shared the Nobel Prize in 2012 for figuring this out.
As Anderson explains it, iPSCs are a renewable cell source – meaning you can grow them indefinitely in culture, in contrast to typical differentiated cells, which tend to peter out. This is critical for Century, according to Anderson, because it means that you can serially and precisely engineer these cells, introducing a seemingly limitless number of modifications to enable the iPSC, once differentiated into a T cell, to become, at least in theory, a highly specific, highly effective tumor killing machine. Moreover, this serial engineering can be done through highly-specific gene editing approaches, like CRISPR, so you can add new genetic material and remove unwanted genetic material in a molecularly precise fashion.
After each genetic modification, Anderson says, you can select the cells you want, and expand them to generate a large number. This population, Anderson continues, is “consistent, and can be fully sequenced and characterized so you know what you have.” This contrasts with the approach used for autologous approaches, where you need to need to repeat your (typically far more limited) engineering for each patient, and there can be a lot more variability. Such “heterogeneity affects product potency,” Anderson points out.
Through sequential editing, researchers can address a range of potential cell therapy challenges. For example, if introduced cells still have their own T cell receptors (in addition to the CAR), they could potentially attack a patient’s own healthy cells – so-called graft-vs-host disease (GvHD) . Gene editing approaches could enable the CAR to be inserted in place of the endogenous TCR, for example. Similarly, the recipient’s own T cells could potentially attack the introduced cells – the “host versus graft” (HvGR) reaction. This could be managed by deleting key molecules on the cell surface critical for such recognition; removal of these structures could enable the introduced cell to largely escape detection.
Cell-based cancer therapy approaches confront a range of additional challenges; many tumors – especially many solid tumors – create a milieu, known as the “tumor microenvironment,” or “TME,” that’s hostile to immune cells, and are filled with factors that suppress the immune reaction (like the poppies in the Wizard of Oz). Attacking T cells also suffer from what’s actually known as “T cell exhaustion,” meaning they may still be present but operate much less effectively, as if they are just tired out. A third challenge for cell therapies is achieving specificity – many tumors don’t have unique markers, so attacking them without injuring normal cells is a significant problem; there are a range of approaches now under development to address this (such as requiring the introduced T cell to recognize some combination of markers or factors in order to respond; this is addressed nicely in Patel’s overview); presumably this capability is something that could also be engineered into the cells Anderson describes. Finally, a fourth opportunity is enhancing the lethality of the cells you are introducing, so that they are even more effective at obliterating the tumor.
As Anderson emphasizes, the key advantage to this approach is that researchers “can edit almost without limitation. If you start with donor derived cells [whether autologous or allogenic], you are much more limited with respect to every gene edit.” But if you use iPSCs, she argues, “the sky’s the limit because of the number of gene edits one can make because of the base technology,” adding, “there’s a lot you can pack in there."  As Century's Chief Scientific Officer Luis Borges subsequently elaborated, "One reason we can do editing without much limitation is because we have the luxury to check for any off-target effects of the editing procedure through genome sequencing, and can eliminate any cells that have unwanted changes. We can check the engineered cells and then do single cell cloning to expand a clone that has just the precise engineering we intended to introduce."
Caveats
Of course, there’s a long way between theory and clinical practice. My most significant concern regarding iPSC-based approaches reflects my own experience as a post-doc in a stem cell lab; there, I was frequently struck by the impact of what’s known as “passage number” – essentially reflecting the number of times a particular cell line has been expanded. While in theory, stem cells can replicate endlessly, in practice, each successive generation may be slightly different than the one before, and may have accumulated new mutations, or new modifications that impact how the cell behaves. I instinctively worry about the length of time a cell must be cultured and expanded, and I worry that a cell line after successive deliberate modifications may have accumulated a series of imperceptible additional modifications that could impact the behavior of the cells – though it’s true that a population of cells developed in this fashion at least should be more homogenous than populations of cells engineered anew for each recipient, if perhaps not as “fresh.”
Beyond this iPSC-focused concern, many of the other engineering approaches that Century and others are contemplating are attractive but largely unvalidated clinically; you can understand why they make sense, but that’s not the same thing as working in afflicted patients.
Audacious Biological Engineering
At another level, though, what’s apparent from Anderson’s description of Century, and from the work of other companies in the cell therapy space, is how incredibly audacious – and routinely audacious -- biological engineering has become. Even the first-generation CAR-T approaches are astonishing, in that they introduce a genetically engineered fragment into a patient’s own cells – arguably an example of gene therapy, or at least a gene therapy-style technique. Then consider the approaches that Anderson describes – such as precise gene editing using CRISPR or similar techniques, as well as the use iPSCs; and it’s not just Century -- aspects of these approaches are typical features of many company proposals my team and I evaluate. Any one of these elements would have been considered beyond fanciful back when I was training, or perhaps at best the sort of zany thing a radical biotech might contemplate. Today, these are the techniques and therapeutic approaches that most large pharmas are pursuing -- aggressively. Virtually all major drug makers seem to be going after opportunities in this space; in addition to the manufacturers of FDA-approved products cited above, others jumping in include J&J (herehere), Pfizer (herehere), Bayer (here, also a key partner in Century as Anderson discusses), and many others (including, Takeda*, as was recently discussed here and here).
While it’s still very early days for cell therapy, and successful financings in this space are far more abundant than FDA-approved therapies, you can certainly appreciate why so many biological engineers, in academia and industry alike, are so excited – and why even some software engineers, like Sean Parker, are starting to think the world of biology may represent “a much more exciting place to be.”
The reality is that it’s both breathtaking and humbling to be at the cusp of two profound engineering revolutions, one involving biology, the other, software. Individually, each has the potential to profoundly reshape the way new medicines are designed, developed, deployed, and evaluated; if thoughtfully integrated, the prospects are staggering.   Biopharma leaders increasingly will need to have a solid grounding in both of these spaces, and understand the possibilities, limitations, and implementation hurdles if this remarkable potential is to be translated effectively into the elusive outcome that matters most – improved health for patients.
 

Sunday, September 1, 2019

Early Focus On Surgical Robotics Gives Stryker A Leg Up

The robots are coming. Don’t be afraid. These machines are changing medicine for the better … one hip and knee replacement at a time.
This exciting technology, which I’ll tell you about in a moment, will only be more life-changing when lightning-fast 5G networks get rolled out to the masses.
3d rendering surgery room with robotic surgery and empty bed
GETTY
Stryker Corp. used to fly under the radar. The Michigan-based company had a good business making orthopedics, medical instruments and supplies. Then managers pushed into robotics. Business took off.
It’s no surprise. Stryker is onto something big. As it always has been. It has a long history of creating revolutionary tools in the healthcare market.
Innovation and vision are in the corporate DNA. As a student at the University of Michigan in 1939, Homer Stryker invented the walking heel, a rubber insert for hard plaster casts. Earlier he developed the Wedge Turning Frame, a special gurney that allowed caregivers to turn patients with serious back injuries.
By the time Stryker was a practicing surgeon in Kalamazoo, he had a research lab in the basement and side business designing tools to make his day job easier. That business was incorporated in 1946. More practical innovations followed.
The company patented an oscillating saw in 1947 that could cut through casts without damaging the skin and tissue beneath. The original turning frame evolved into the Circ-O-Lectric in 1958. Sales exploded to $1 million.
By 2010, a series of forward-looking acquisitions made Stryker a major player in orthopedic implants, medical devices, surgical products and neurotechnology. Revenues ballooned to $7.3 billion.
Kevin Lobo became chief executive officer in 2012. Two years later his team had completed seven major acquisitions, including Pivotal Medical, a hip arthroscopy business; Small Bone Innovations, a Pennsylvania firm that specialized in small bone and tissue repair; and Mako Surgical, a fast-growing manufacturer of robotic arms used by orthoepic surgeons for hip and knee replacement surgery.
The buyouts gave Stryker vertical integration in orthopedics. The company made the implants, developed the software and built the hardware surgeons used to install the devices.
The strategy was prescient. Knees and hips are the largest joints in the human body. They support body weight and, as aging Americans are becoming more obese, the number of chronic problems is on the rise.
According to the American Academy of Orthopedic Surgeons, one million hip and knee replacements were performed in 2013 alone. Subsequent research completed in 2018 predicted the number of procedures will grow to 1.8 million annually by 2030, as the number of younger patients rise.
The Florida Orthopedic Institute noted that Mako robotic systems have been used more than 50,000 times for hip and knee replacements since 2006.
The procedure for hip and knee replacement involves a CT scan, a patient specific 3D model, and a pre-plan surgery strategy. From this data and cameras mounted on the arm, the Mako system maps the procedures. The robot knows exactly where the bone is at every point in time during surgery.
Dr. Kenneth Gustke, a surgeon at Florida Orthopedic, explained in a thorough demonstration video that the robot performs all alignment once the physician activates the trigger. Cuts are accurate within one millimeter.
The Mako system gives surgeons the flexibility to customize and fit the implants, then reestablish alignment with high precision. The result is safer surgeries with better outcomes for patients.
At Stryker, those better outcomes are leading to market share gains and better utilization rates for its sought-after robots.
Lobo told analysts following the second-quarter financial results on July 25 that total Mako procedures grew to 27,000, a 54% increase year-over-year. Second-quarter knee replacements rose 80%, to approximately 18,000.
The company sold 44 robots globally during the quarter, with 35 units sold in the United States. This is up from sales of 39 and 29 units, respectively, a year ago.
Overall, the company had organic sales growth of 8.5%. And all three of its major operating divisions — Orthopedics, MedSurg and Neurotechnology — reported increases.
In July, the company reported $3.6 billion in sales, a 9.9% increase versus the previous year. And Stryker generated $827 million of free cash flow.
Strong numbers have made the stock are impressive performer. Shares have risen 36.5% in 2019. The stock currently trades at 23.7x for earnings and 5.5x sales. The market capitalization is 79.4 billion.
While these financial metrics may seem expensive, keep in mind that Stryker’s organic growth far exceeds its peers. The company is in a very strong competitive position in a part of the healthcare marketplace far removed trade tensions or domestic political debates. Managers put the company in position to grab market share in the race to replace hips and knees.
The shares are buyable for growth investors on pullbacks.

Roche Positive Phase 3: Xofluza Cuts Risk of Flu After Contact With Infected by 86%

Genentech, a member of the Roche Group (SIX: RO, ROG; OTCQX: RHHBY), today announced that the Phase III BLOCKSTONE study showed preventive treatment with Xofluza™ (baloxavir marboxil) after exposure to an infected household member significantly reduced the risk of people developing the flu by 86 percent versus placebo. The results show just 1.9 percent of Xofluza-treated household members had the flu compared with 13.6 percent in the placebo-treated group (p<0.0001). This benefit with Xofluza remained statistically significant versus placebo regardless of influenza A subtype (H1N1: 1.1 percent versus 10.6 percent, p=0.0023; H3: 2.8 percent versus 17.5 percent, p<0.0001). It was also observed in household contacts who are at high risk of flu-associated complications (2.2 percent versus 15.4 percent, p=0.0435), and children under 12 years of age (4.2 percent versus 15.5 percent, p=0.0339), who are more vulnerable to developing the flu. Xofluza had a comparable safety profile to placebo, with an overall incidence of adverse events being 22.2 percent for Xofluza and 20.5 percent for placebo. No serious adverse events were reported for Xofluza. Full results of the study were presented as a late-breaking abstract during the OPTIONS X 2019 congress in Singapore on Sunday, September 1, 2019 (Abstract #11718).
“As the influenza virus can rapidly infect those around us, limiting the spread of infection within households potentially avoids a significant impact on the wider community – a critical step in the global fight against the flu,” said Sandra Horning, M.D., chief medical officer and head of Global Product Development. “We are encouraged by the BLOCKSTONE study, the first to show that Xofluza is an effective preventive treatment following exposure to the flu and we look forward to sharing these data with health authorities.”
The BLOCKSTONE study also demonstrated that even when fewer criteria were applied (proportion of participants with the flu, with fever or one or more respiratory symptoms), there was still a significant 76 percent reduction in the risk of household members developing the flu with Xofluza versus placebo (5.3 percent versus 22.4 percent respectively, p<0.0001).
Xofluza is the first and only one-dose oral medicine approved to treat the flu in otherwise-healthy patients, and the first flu medicine with a novel proposed mechanism of action approved by the FDA in nearly 20 years. Robust clinical evidence has demonstrated the benefit of Xofluza in several populations (otherwise-healthy, high-risk, children) and treatment settings (symptomatic flu, post-exposure prophylaxis).