Home' Technology Review : October 2005 Contents 32
I , & Johnson was
the undisputed king of bare-metal
stents. Stents are the mesh tubes
that prevent arterial collapse after
balloon angioplasty, the principal
treatment for atherosclerosis: A balloon is
inserted into an artery to clear away plaque
and is removed. Then a stent containing
another balloon is inserted into the artery.
The balloon is in ated to open the blocked
artery and push the stent against the arte-
rial walls; this balloon is then de ated and
removed. J&J held a strong patent portfo-
lio that gave it dominance in the U.S. stent
market. It also led in Europe, where it
faced sti er competition.
Stents revolutionized the treatment of
atherosclerosis in coronary and periph-
eral arteries, but they did little to address
one of the chief problems with balloon
angioplasty. In about 30 percent of cases,
scar tissue formed around the site of the
injury, causing the artery to close again, a
setback called restenosis. Stents reduced
the restenosis rate slightly, but it was still
high. Today, restenosis in coronary arter-
ies a icts less than 10 percent of patients
thanks to the development of the drug-
eluting stent (DES), which slowly releases
a drug that inhibits the growth of scar tis-
sue. Drug-eluting stents now command
more than 90 percent of the $3 billion U.S.
coronary-stent market, according to the
Millennium Research Group. DESs have
not been approved for peripheral arteries.
Johnson & Johnson pioneered the new
generation of stents, but the $50 billion
company lost its dominant market position
to a partnership between medical-device
company Boston Scienti c of Natick, MA,
and Angiotech Phar maceuticals of Van-
couver, BC. The two companies signed a
pact in 1997 that led to the development of
Boston Scienti c's Taxus stent, which was
introduced in the U.S. in March 2004.
Taxus was arguably the most successful
new medical product in history, netting
more than $1.4 billion in sales in its rst
nine months in the U.S. alone. And that's
despite the divergent business models of
the companies that created it.
The project dates to 1996, when Bill
Hunter, cofounder and chief scienti c o -
cer of Angiotech Phar maceuticals, ap-
proached J&J and other stent makers with
his own solution to the restenosis prob-
lem. His company had obtained a license
to produce paclitaxel---better known by its
brand name, Taxol---an anticancer dr ug
derived from the Paci c yew tree. Ap-
proved as an anticancer agent in 1992, it is
marketed by Bristol-Myers Squibb. Stents
coated with the drug worked remarkably
well in animals, keeping rat arteries clearer
than uncoated control stents did. Hunter
made the rounds of the stent manufactur-
ers, including J&J, Medtronic, Guidant,
Boston Scienti c, and Cook.
Angiotech and J&J engaged in discus-
sions, though J&J was already working
on a DES that would utilize sirolimus, an
immunosuppressant marketed by Wyeth.
Hunter talked with the other companies
while keeping an eye on Europe, where
J&J was also a market leader, but nothing
was settled. New stents entered the mar-
ket often, and "other companies were tak-
ing market share from J&J," says Hunter.
As he pondered his options, Hunter re-
ceived an unusual o er. Cook and Boston
Scienti c were longtime competitors, but
in order to make a more attractive o er to
Angiotech, they had decided to band to-
gether, proposing a joint agreement that
would allow both to develop paclitaxel-
coated stents. The nancial terms for both
companies would be identical.
"They said, 'We understand that if you
want to deal with one company, it would
be the market leader [J&J], but would
you be more interested in dealing with
the number two and number three com-
panies?' We thought it would be a phe-
nomenally good idea," says Hunter,
especially in light of the situation in Eu-
rope, where, he says, "cardiologists were
switching brands almost monthly. It be-
came very di cult to predict who would
have the best stent." And no matter how
good the drug, if it were matched with a
lousy stent, it wouldn't have a chance.
"We felt with two horses, we doubled our
chances that we would be competitive."
In the summer of 1997, the three compa-
nies signed a pact.
Boston Scientific's Forward Thinker
Using a drug was a novel approach to the
problem of restenosis. Stents work on a
simple principle: a balloon expands the
stent to support the arterial wall and is
then de ated and removed. Companies
had tinkered with stent designs, trying to
prevent restenosis, but with little success.
"It was surprising that [only] a few compa-
nies were for ward-thinking enough to look
at biological approaches," Hunter says.
Most of Boston Scienti c's products
were typical low-risk medical devices, but
THE CASE: When Boston Scientific needed a way to prevent
scar tissue from covering up its coronary stents, it turned to
a little-known company called Angiotech Pharmaceuticals.
The odd partnership yielded one of the most financially
successful medical devices in history---and signaled a new
way for medical-device companies to improve their wares.
FY 2004 revenues: $5.6 billion
Taxus's share of 2004 revenues: 38%
COURTESY OF ANGIOTECH PHARMACEUTICALS
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