G-Therapeutics: a success story of Europe’s MedTech climate
Dec 16, 2016 2:19:57 PM. By: High Tech Campus
Sometimes technology can look a lot like religion. Take G-Therapeutics, the new Swiss-Dutch MedTech startup on High Tech Campus Eindhoven that scooped up €36 million in funding.
Using groundbreaking science they are building a device whose mission is nothing short of miraculous: helping paralyzed people to walk again. CEO Sjaak Deckers tells us more.
By Hidde Tangerman
Between 250,000 and 500,000 people worldwide suffer from a spinal cord injury every year. Spinal cord injury results in paralysis, as the neuronal pathways are cut and signals from the brain fail to reach the muscles. By implanting a flexible lead with electrodes close to the spinal cord and delivering timed electric pulses, the Swiss professor Grégoire Courtine found a way to reconnect the brain and get the paralyzed muscles working again. After proving the science on mice, rats and monkeys, his team started the company G-Therapeutics to develop the technology further towards human use.
Been there, done that Sjaak Deckers, former founder of MedTech startup Sapiens and a familiar face on High Tech Campus Eindhoven, is the CEO of the company. “I’m interested in companies that fulfill a serious unmet need with technology I believe in,” says Deckers. “That all converged in G-Therapeutics. It’s fantastic to get people to walk again, while also improving health issues like bladder control and digestion. I was impressed with the scientific research of Courtine’s team and immediately felt comfortable with them.”
In early 2015 Deckers was asked to come on board as G-Therapeutics’ CEO to help the early startup grow into a more mature MedTech company. Groundbreaking science alone isn’t sufficient to make VC’s enthusiastic, Deckers says. “You cannot build a successful company with professors only. It also requires business experience to turn these ideas into a realistic business plan and a credible pitch to attract investors.”
European cross-pollination Deckers didn’t disappoint. In his Series A round he managed to secure €26 million in investments plus a €10 million innovation loan from the Dutch government. “Investors look very critically into the team around the product,” says Deckers. “It gives more credibility if you have some people there who have been there and done that.” For Deckers ‘been there and done that’ refers to his former company Sapiens, which he sold for US $200 million in 2014 .
The cooperation between the Swiss scientists in Lausanne and the Dutch team Deckers brought on board is another example of successful European cross-pollination in the field of technology. When it comes to building ventures and joining forces for high tech quality, the European networks often prove stronger than country borders.
Neuroplasticity G-Therapeutics wants to combine electrical stimulation of the neurons with intensive physiotherapy in order to restore the disrupted connections between the brain and the spinal cord. Deckers: “We’re using the inherent neuroplasticity of the brain and spinal cord to make those damaged nerve cells form new axon branches. Then they can connect again to the synapses of the motor circuit neurons below the spinal cord injury.”
The innovation of G-Therapeutics is not only a technological breakthrough, but a clinical innovation as well. “It’s a new form of therapy,” Deckers explains. “We’re both developing an innovative stimulation system with real-time gait feedback and designing the tailor-made rehabilitation therapy that comes along with the implant.”
The company focuses on patients with a so-called low and incomplete spinal cord injury first, with paralysis in the legs. More severe, complete spinal cord injury lesions will follow when the therapy has proven itself.
Business angels Finding funds in Europe can be quite challenging. Although Europe has a lot of high tech talent and potential, the investors climate is not always ready to support them. “It’s understandable that investors are critical and want to separate the chaff from the wheat,” Deckers says. “But unfortunately there are only very few investors in Europe that are willing to accept the high risks associated with this type of early-stage development. As a MedTech startup you already have to show a lot of results to demonstrate you have minimized the risks. My advice to startups is to try and scrape together as much as you can with subsidies, business angels, alliances with universities, etcetera in order to acquire sufficient proof points that will make investors believe in your story.”
Yet Europe and especially The Netherlands also have distinct advantages, Deckers says. “We have an excellent healthcare system with professionals that are willing to collaborate with innovative companies, partly due to subsidies. Also the salary cost is lower here than in the US and the regulatory climate is better. It’s easier to get CE certification than it is to get FDA approval, although unfortunately this may change in the coming years.”
Tech talent As with his former company, Deckers made a conscious choice to locate G-Therapeutics on the High Tech Campus in Eindhoven, apart from the Lausanne offices. “The High Tech Campus is a great place to be for international tech talent. It’s great to have such a large community with various skills. The physical proximity of big corporates is also a plus. When needed I can easily connect to people there.”
G-Therapeutics now has enough funds to develop their product, which may take five to six years, Deckers says. They are preparing a clinical pilot study to get the first human-based results and to fine-tune the technology. A major clinical study will follow a few years down the line, when the first implant system is fully developed.
Any chance of a large corporate MedTech company knocking on the door then? Deckers: “We’re building a world-class company to significantly improve the life of patients and we’re not waiting to be bought. If we can show impressive results with our therapy, I can imagine big companies will be interested, and we’ll take it from there.”