Research and academic professionals in neural engineering know well the promise the field offers for advancing our understanding of basic neuroscience and devising new therapies for treating neurological diseases and disorders. But there is also considerable commercial opportunity for new start-up companies in several areas of neural engineering. The neurotechnology industry, which includes firms that manufacture neuromodulation devices, neural prostheses, neurorehabilitation systems, and neurosensing devices, is forecast to grow to grow from $3.6 billion this year to $8.8 billion in 2012, according to a recently published market research study from Neurotech Reports.
In recent years, there have been several successful spinoffs of neurotechnology startup firms that originated with research at universities and clinical institutions. In many cases, the academic researchers who invented the new technology or product innovation have stayed on with their startup firms after receiving funding from venture capital firms, or after going public.
Among the most successful neurotechnology industry spinoffs in recent years were:
Cyberkinetics Inc., Foxborough, MA, a manufacturer of brain–computer interface devices based on research at Brown University. John Donoghue, a professor and chairman of the department of neuroscience at Brown University and executive director of the brain science program at Brown, founded the company in 2001 and remains on board as the chief scientific officer.
Synapse Biomedical, Inc., Oberlin, OH, a manufacturer of diaphragm pacing systems, based on research at Case Western Reserve University. Raymond Onders, director of minimal invasive surgery and associate professor at University Hospital Case Medical Center in Cleveland, was the primary researcher. He was helped by J. Thomas Mortimer, professor emeritus of biomedical engineering at Case, and it was Mortimer who came up with the name NeuRx for the device. Onders performed his first surgical implant of the device in 2000. Anthony Ignagni, who worked with Mortimer and Onders as project director and chief biomedical engineer, became a co-founder of Synapse and is currently president and CEO.
Afferent Corp., Providence, RI, a manufacturer of sensory stimulation systems based on research at Boston University, Afferent's technology is based on work by James Collins, professor of biomedical engineering at Boston University, who showed that low-level stochastic, or random, vibrations improved sense of touch. Collins went on to demonstrate that generating a subthreshold noise in the sensory pathways with a random electrical stimulation improves detectability of weak mechanical stimuli. In 1999 entrepreneur Jason Harry licensed the stochastic resonance technology from Boston University and received help from the Community Technology Fund-the university's technology transfer incubator.
NeuroNexus Technologies, Inc., Ann Arbor, MI, a manufacturer of implanted neural probes, based on a program at the University of Michigan. NeuroNexus was spun out of UM's Center for Neural Communications Technology. Daryl Kipke, head of the Neural Engineering Laboratory at the university, started up NeuroNexus with several colleagues and currently serves as president and CEO.
Commercialization issues were discussed recently at a preconference workshop at the 2007 meeting of the International Neuromodulation Society in Acapulco, Mexico. In the session, which was chaired by Chris Coburn of the Cleveland Clinic, neurotech entrepreneurs John Bowers from Northstar Neuroscience and Ben Pless, formerly of NeuroPace, shared their experiences bringing neuromodulation therapies to market. Coburn related his observations from the Cleveland Clinic, which has spun off 22 companies over the last five years. He cited several factors that would influence a neurotech startup's market potential, such as identifying the regulatory pathway, any predicate devices that exist, and the revenue potential for potential investors.
Bowers cited several factors that would be critical for the growth of the industry, including reaching out to the 'influential implanters' and pushing reimbursement based on quality of life improvements, rather than mortality. Pless provided an overview of patent-related issues affecting neuromodulation devices. He noted that there have been 2000 issued patents for neuromodulation devices, most of them involving the peripheral nervous system.
The example set by these companies and other startups in the neurotechnology industry should remind neural engineering researchers that there are plenty of opportunities for commercial success based on promising research at university and clinical research laboratories. Given the wide range of help and information that is available to potential entrepreneurs in this field, we expect to see many more examples of neurotechnology spinoffs in the years ahead.