The need for “life support” in the intensive care unit (ICU) strikes fear into most people.
Tag on “organ failure”, “sepsis” and “hospital acquired infection” and you have the makings of a horror story that plays out every day in ICUs around the world. CytoSorbents Corporation (NASDAQ:CTSO) and its blood purification technology are looking to change this.
“We are focused on reducing deadly inflammation in common, life-threatening illnesses such as sepsis – the overzealous immune response to an infection, burn injury, trauma, pancreatitis, liver failure and many other conditions where inflammation plays a detrimental role,” Dr Phillip Chan, chief executive officer of CytoSorbents, told Proactive Investors.
“Left unchecked, this uncontrolled inflammation can lead to the failure of vital organs like the heart, brain, lungs and kidneys, the leading cause of death in the ICU today,”
Reducing fuel to the fire
CytoSorb, the medical device maker’s flagship product, is a promising blood filter designed to reduce the “fuel to the fire” of deadly inflammation and is approved for use in the European Union, with distribution in 34 countries worldwide.
It has been clinically proven to reduce key cytokines – cell signalling molecules involved in regulating the immune system's response to inflammation and infection – from the blood of patients who are critically-ill.
For good measure, it also removes many other inflammatory mediators, such as free haemoglobin released during open heart surgery, bacterial toxins during severe infection, pancreatic enzymes in pancreatitis, and bilirubin (a brownish yellow substance in bile) in liver failure.
Historically, physicians have tried a wide variety of drugs and biologics to control this severe inflammation in critical illnesses. Unfortunately, these agents are either too weak, like ibuprofen, to get the job done, or too strong, like high dose steroids and chemotherapy, which can turn off inflammation but at the cost of crippling the immune response that is needed to heal and fight infection.
Without effective ways of dealing with the inflammation, many patients deteriorate in a cascade of organ failure, only to be kept alive on machines or “life support” that does not treat the underlying illness but buys time until the body either heals itself or, sadly, loses the fight against organ failure and other complications.
This is a hit and miss affair; around one in three patients die once organ failure occurs and many that survive are so debilitated that they either die or wind up back in the hospital in the next year. It is also very costly, with patients lingering days to weeks at a time, at a cost of US$2,000-3,000 per day in the ICU.
A Brita filter for the blood
This is where CytoSorb comes in. The CytoSorb cartridge is the only specifically approved extracorporeal, or “out of the body”, cytokine filter in the European Union (EU). It is compatible with standard dialysis machines and other external blood pumps like heart-lung machines.
CytoSorb contains biocompatible, highly porous polymer beads, roughly the size of a grain of salt, which act like tiny sponges to remove harmful substances from the blood.
“Upon magnification, each bead has millions of pores and channels, giving a single CytoSorb cartridge approximately seven football fields of surface area on which to capture and eliminate toxic substances from blood and bodily fluids,” explained Dr Chan.
The blood is pumped through the beads, adsorbing unwanted or toxic substances, and then the purified blood is recirculated repeatedly back into the patient.
“Although it is more complex than this, some compare it to a Brita filter for your blood,” said Dr Chan.
The number of treatments a patient receives is dependent on the illness and severity of disease; however, each treatment uses a new cartridge, which means CytoSorbents’ business is based on the “disposable razorblade in someone else’s razor - business model”. It is a high margin device and requires minimal training to use it.
With more than 12,000 human treatments administered to date, CytoSorb appears to be filling a major unmet need in clinical medicine.
“Critical care doctors completely understand what we are trying to do,” said Dr Chan. “This concept of cytokine storm driving a deadly inflammatory response that then leads to organ failure and death is well-understood, so our sales process is fairly straight-forward and is getting easier as we obtain more clinical data.”
The costs of sepsis
Critical care in the US costs US$80-90 billion a year, according to a report published in 2010. A large part of this cost is related to sepsis, a top-ten cause of death worldwide, driven by the body's immune system going into overdrive in response to a dangerous infection, causing uncontrolled inflammation, organ failure, and often death.
A 2013 survey, “National In-patient Hospital Costs: The Most Expensive Conditions”, put the cost of sepsis in the US at US$20.3 billion a year, while lung failure cost US$8.8 billion and kidney failure US$4.7 billion. Experts expect these costs will only get worse, driven by a higher incidence of disease as the baby-boomer generation grows older. The lack of effective therapies and the high cost of care make a compelling case for CytoSorb, as both a medical and economic imperative.
CytoSorbents is also working on a path to potential US approval in the area of cardiac surgery.
The company is currently running its REFRESH I study using CytoSorb during complex open heart surgery to purify a patient’s blood of inflammatory toxins while they are being generated. Left unchecked, this can lead to organ failure after the surgery.
This 40-patient, eight centre study is expected to finalise enrolment with top-line results this quarter. This should position the company for a pivotal, registration trial to start next year. If everything proceeds according to plan, CytoSorb could get the approval green light in 2019.
In the meantime, CytoSorbents is looking to expand its penetration of European and world markets.
The company began selling CytoSorb directly in 2012 in Germany, Austria and Switzerland. Meanwhile, sales to the other countries are handled through distribution agreements and collaborations with major strategic partners, such as Fresenius Medical Care, the world's largest dialysis company, and independent distributors.
Just last May, Fresenius launched sales of CytoSorb in France, Poland, Denmark, Norway, Sweden and Finland. In addition, the company has hooked up with Biocon Ltd, the largest biotechnology company in India, to address the market in the Indian sub-continent.
Results for the first three months of 2016 showed an impressive 127% year-on-year increase in product revenue growth to US$1.60 million from US$705k in the corresponding quarter of 2015.
It was also the third consecutive quarter of record sales for the company and puts the company on track to break through the US$5 million annual sales barrier and blast on through to US$6 million in sales and above.
Losses narrowed dramatically to US$1.8 million from US$4.7 million the year before.
“For the remainder of 2016, we anticipate increased momentum in our core business,” Dr Chan told Proactive. “We continue to work aggressively to drive to a potential inflection point in our business, operating cash flow break-even, and the success of our company,” he added.