In the late nineties, researchers from a promising yet volatile French SME in the medical sector decided to bet on their own horse. The seven founders teamed-up with Gérard Heinrich, an experienced businessman familiar with the pharmaceutical industry and with Gemmes Ventures, an investment fund specialising in start-up support. Now venture capital firms associated to names such as Rotschild are backing CrossJect, which is awaiting favourable conditions for stock-market flotation.
A Simple idea
The product is as simple as it is daring – a needle-free injection device. Though the idea has been around since at least the last century, no-one so far has managed to develop an efficient product that can inject all kind of medical molecules with the same level precision and reliability. Most importantly, the device, called Zeneo, answers a real market need. ‘We did not try to reinvent the wheel with this project, nor did we come up with a new high-tech process that was not already out there,’ says Patrick Alexandre, Chief Technical Officer at CrossJect ‘we created a technology able to answer a simple market opportunity’. Still the young company has been prolific in patents, with 26 different innovations registered through 370 different patents worldwide.
Market projections are equally impressive: first sales are planned for 2014 and the production of needle-free injection devices could already reach 150 million units by this time, covering a fraction of the 12 billion injections given each year worldwide; many of which are administrated by the patients themselves. With a rapidly ageing population in the western world, putting welfare state budgets under pressure, the medical community sees self-injection as a safe and reliable solution, especially adapted to the treatment of chronic diseases such as hepatitis or arthritis.
‘It was obvious to me that the simplicity of the product and the straightforward nature of the business plan have been key to attract financing ‘.
Philippe Monnot, Gemmes Venture
The Zeneo device is also a good solution to needle-phobia, a fairly common problem, with an estimated prevalence of 15% in the general population. This often results in patients not complying with their treatment programme. But the real potential of this project lies in the fast development of medical products based on biological compounds. ‘This kind of medication is not adapted to go through the digestive system and often necessitates a recurrent use, injection is then the best solution’ says Heinrich, now Chief Marketing Officer of the company.
R&D meets finance
From the very beginning of the adventure, CrossJect’s strategy has been to actively look for venture capital support. One of the first venture capital companies to invest in CrossJect was Paris-based Gemmes Venture. ‘CrossJect is one of the very first companies we invested in, so far we have injected in it 2,5 million euro’ says Philippe Monnot, CEO of Gemmes Ventures and chair of CrossJect’s supervisory board. ‘It was obvious to me that the simplicity of the product and the straightforward nature of the business plan have been key to attract financing ‘.
Another crucial factor played in the start-up’s favour: time. The common delay with commercialisation of research in the biotech sector is the long period of clinical trials. CrossJect, however, is not about testing new drugs but the development of a new way to administrate them. Consequently, the duration of clinical trials is minimal compared to other products aimed at the pharmaceutical market. ‘We are talking about two years of clinical trials, when usually development of product development in this field implies a 10-year trial period’ says Patrick Alexandre.
‘The procedure to obtain public funding through the Eurostars Programme is astonishingly simple’.
Patrick Alexandre, CrossJect
Technology comes before money
‘The procedure to obtain public funding through the Eurostars Programme is astonishingly simple,’ says Alexandre. Moreover, Eurostars has played an essential role in counterbalancing the risk-aversion of private investors and it has also enabled CrossJect to create a real partnership with a company with skills that could not be found in France. ‘Thanks to the Eurostars Programme, Hirtenberger, an Austrian company, was able to replace our previous partner, which did not have the strength to carry the production of the device on an industrial scale’.
The mechanics behind the injection system were key to the development of the product. Within a few months, Hirtenberger managed to develop a viable solution for the injection of pharmaceutical molecules, with a notable input in the pyrotechnic method used to inoculate the drug. Hirtenberger also made possible key changes in the design of the needle-free injector possible, making it a lighter, more visually-appealing and easily marketable product and thus answering to the demands of CrossJect’s industrial partners and pharmaceutical clients.
‘When we first started this project, people were telling us, you have money-rich competitors who have failed in developing this technology’ says Monnot. However, the company’s objective has always been one of a measured and cautious development, avoiding short-term investors looking for a quick resale and profit. ‘Our experience tells us that putting big money on the table does not always bring a technological project to a good end.’ In that sense, the Eurostars ISTAR project has been a perfect example of cautious and well-timed investment, giving a promising start-up the little push it needed to reach the market.