2008 ACES winner Orthomimetics acquired in €16M deal

Andrew Lynn, founder and CEO of Orthomimetics

Regenerative medicine is getting ready to become a real industry, said Gil Beyon, CEO of TiGenix, announcing the acquisition. As yet most companies are small or medium-sized and there is an opportunity for consolidation. At the same time the early successes have demonstrated the benefits of operating as a fully-integrated company, encompassing early stage science, clinical development, manufacturing and marketing.

TiGenix is issuing 3.74 million new shares, which come with a lock-in until 2010, to Orthomimetics shareholders. ACES winner Andrew Lynn, who is CEO and founder of the company, is to join TiGenix as chief business officer.

Lynn won an inaugural ACES Academic Enterprise Awards Europe 2008 from the Science|Business Innovation Board last December in materials/chemistry, one of the six award categories. ACES is the first pan-European programme to recognise enterprise in universities and research institutes. For a profile of Lynn’s career, see our report “Get lots of advice early on – and question all of it”. 

Orthomimetics benefited from £4 million in funding prior to its spin-out from the Cambridge MIT Institute in 2005. The company subsequently raised a further £7.3 million in venture capital and government grants. Orthomimetics apart, the much-vaunted Institute, funded with £65.1 million from the UK taxpayer, failed to live up to its promise. While one or two other technologies from the Institute were out-licensed, Orthomimetics was the only free-standing technology company to be established as a result.

The venture capital investors in Orthomimetics include Oxford Capital Partners, Schroders Investment Management and Goldman Sachs.

As the first company to have a cell-based product approved through the European Union’s new advanced tissue therapies route, Leuven-based TiGenix believes it can lead the consolidation of the sector. “Critical mass and a multidisciplinary approach will be necessary to become successful and profitable,” said Beyon in a teleconference announcing the deal. The company has all the resources and has shown it can, “transform a scientific idea into a product,” Beyon said.

TiGenix’s newly-approved ChondroCelect product involves taking a biopsy of healthy cartilage and expanding this in its dedicated tissue culture facility, before re-implantation to replace damaged cartilage. Meanwhile, Orthomimetics specialises in biodegradable scaffolds based on collagen. Its lead product, Chondromimetic, is an off-the-shelf implant for bone repair in the knee. From this position in cartilage and bone repair in the knee, TiGenix now plans to expand its business into ligament and tendon products for repairing knee joints and also to move into other joints. “This will be focussed leadership: we won’t get side-tracked,” said Beyon.

While many other companies are developing replacement joint tissues of various sorts, Orthomimetics claims its unique selling point is in the ability of its products to help the body’s natural repair mechanisms to heal defects. Its scaffold does this by providing an interface that both bone and cartilage are able to attach to.

Lynn, who holds a doctorate in material science and metallurgy from Cambridge, linked up with Brendon Harley, a doctoral candidate at MIT, to bring together intellectual property from both institutions in the development of the platform technology. The work was helped by a year Lynn spent in Japan, observing orthopaedic surgeons.

Earlier this month, TiGenix became the first company to be granted pan-European approval for a cell therapy under the Advanced Medicinal Product legislation, which came into effect in January. The formal approval by the European Commission and the European Medicines Agency gives TiGenix the right to market ChondroCelect in 30 countries in Europe.