The next time you see a 50-something limping around on a bad knee or hip, forget empathy and ask yourself, “What’s in it for me?” This might seem cold, but there are fortunes being made in the aches of aging Baby Boomers.
“There has to be an option out there somewhere between doing nothing and suffering, and getting a whole new knee,” says Dr. Cynthia Doerr, a venture capitalist scanning for some of these fortunes on behalf of $1 billion-in-assets Essex Woodlands Health Ventures in Houston. “That is a market screaming for a product.”
Last year, Doerr came to Memphis
in hopes of discovering an early stage company pioneering new markets in biomedicine. Early next month, plenty of other institutional investors will make the journey to the second annual Musculoskeletal New Ventures Confer- ence (www.mnvc.org) for the same reason. And again this year, markets for bone and joint devices and related drug treatments appear to be ripe areas for investment
“The conference is unique,” Doerr says. “Others have focused on aspects of health care, but this is the only one focused on the musculoskeletal area. It’s an excellent idea and I hope it continues.”
When Memphis business leaders planned a 2003 venture capital conference geared to musculoskeletal-related biotech startups, they were simply building on the city’s leadership position in musculoskeletal industry, research and clinical practice. Bringing together companies hawking innovative technologies and venture capitalists looking for the next big thing, the conference’s leaders succeeded in creating “a great part of a regional economic development plan,” says Peter Kleinhenz, a venture capitalist in the Columbus, Ohio, office of CID Equity Partners. “They want more companies to grow in Memphis because of all the strengths in the orthopedic business. That makes sense.”
Local business leaders concede key conference goals are to highlight the area’s strengths in orthopedics and to encourage more biotech companies to consider locating here. None of the 10 or so companies presenting Oct. 6 and 7 at the FedEx Institute of Technology at the University of Memphis are from Memphis. Only BioMimetic Pharmaceuticals, a Nashville company focused on the development and commercialization of protein therapeutics for tissue regeneration, is based in Tennessee.
Memphis’ existing industry assets include spine products maker Medtronic Sofamor Danek and orthopedic device makers Smith & Nephew and Wright Medical. Prominent orthopedic clinics like Semmes Murphy and the Campbell Clinic call Memphis home, as does the Medical Education and Research Institute, known around the world for training 2,000 orthopedic surgeons a month to perform innovative surgical procedures and utilize the latest orthopedic and spinal devices.
It’s spinal disc technology addressing lower back pain that is in most acute need of investment and innovation, CID’s Kleinhenz notes. Yet, arguably the most promising biomed niche is the emerging field of biologics. This niche addresses orthopedic problems with drugs rather than mechanical devices.
Whatever the technology, the gamble is the same for the venture capitalist, says Tom Melzer, the former president of the Federal Reserve Bank of St. Louis who now manages Rivervest, an $89 million venture capital firm based there. “Some of these new biologic approaches could be the best for the future, but how do you know which ones?” he asks. “What are the technical challenges? Is it too early to try this?”
All good questions. They’ll take years, even decades, to answer. In the meantime, Memphis’ grip on all things musculoskeletal stands to do nothing but get tighter. And its industry serving that aging bulge in the nation’s demographic profile stands to grow
far richer.
Email to a Friend
Print-Friendly Format