Healthcare Digital speaks with the CEO of the leading provider of home-based dialysis treatments
By Gabe Perna
Like most successful businesses NxStage Medical started with a concept – the idea that dialysis treatment could be done at home.
Jeffrey Burbank, current CEO of NxStage, says about 10 years ago he and the other founding associates recognized the need for a home-based dialysis treatment device for End Stage Renal Disease (ESRD). The 20 year industry veteran and inventor of 50 US patents for medical devices remembers seeing studies which said patients with ESRD were better off with more frequent therapy as opposed to a few visits a week.
“It would be so simple, a patient and helper could do the therapy within the home which would allow more frequent therapy,” recalls Burbank. With none of the major medical device players able to master the correct technology, Burbank and the others saw an opportunity. Moving quickly they wrote a business plan, secured funding and began to build NxStage Medical from the ground up.
The Lawrence, MA based company has already come a long way in 10 years – with seemingly endless untapped market potential ahead of them. Last year the company posted revenue of US $128.8 million and just recently it has begun to expand into international markets. We recently spoke with Burbank for our Weekly Healthcare Digital Q and A segment. Burbank divulged the advantages of the portable NxStage dialysis system, the company’s support from esteemed Senator Ted Kennedy and much more.
What are the issues with the current methods of treating End Stage Renal Disease?
The way it’s done now, the vast majority of patients are treated within a dialysis center (“in-center”) three times a week. Within the center, they receive a treatment that lasts approximately four hours. Plus it takes them a few hours to get ready before, drive there and time is required after. Before the actual dialysis treatment, they are building fluid and toxins. Over 2-3 days , they start bloating and become sick. All the fluids and toxins must be flushed out of their systems through dialysis treatment. The in-center, three times a week therapy process takes a tremendous toll on their body. Typically, patients are very tired after in-center dialysis. They normally go home and sleep.
What are the advantages of the NxStage System One compared to the traditional method of dialysis treatment?
First, the NxStage System One is used in the patient’s home under prescription. Given its ease of use and small size, the system is portable and many of our patients take it with them when they travel. Second, the System One enables therapeutic flexibility- a patient is able to do more frequent hemodialysis (5-6x per week) versus the in-center 3x a week model. I’d say there are three main advantages to the System One and the therapy it enables. For one, there is a 50 percent less mortality rate on our treatment than in-center dialysis. The other advantage is the quality of life aspect. It reduces a patient’s time of recovery from treatment from eight hours down to one hour. And, from an economic perspective, it reduces the cost of care significantly. Our treatment allows patient to treat when they want, where they want and it allows them to live their life not restricted by when they have to go to dialysis center. They have the freedom to pursue their life on their terms. This is a very big benefit for our patients.
Can patients use the NxStage System One alone – or do they need assistance?
We don’t promote solo single patient use. Our labeling requires another person be present during treatment; however, this individual doesn’t have to be a healthcare professional- most often, it’s the patient’s spouse, partner or relative. Most patients do the therapy themselves, it’s simple to learn and do.
NxStage System One with the PureFlow (underneath).
What is the FREEDOM Study and how does it benefit you guys?
It’s very important with these new technologies to have the data that shows the benefit of them. The FREEDOM Study analyzed the near-term, quality of life benefits of our system. It is investigating the total cost of care economics, the drug usage and mortality rates. It was important to look at the economic benefit of our system. This includes the total cost of care, not just the cost of treatment. We think it’s important to ensure that this is the best way to treat patients.
What have been some challenges in getting the NxStage name and products out there?
There are a couple of things. One, certainly it’s an industry that hasn’t changed a lot. When you’re dealing with an industry like that, that doesn’t readily adopt and implement new technologies, it takes longer to penetrate. Other companies had tried and failed to introduce a home dialysis treatment system to the market. There was a little bit of the legacy of failure that we had to overcome. The third issue is technically it’s very challenging to make this product as complex as it is. To take it out of a controlled environment, make it easy to use, easy to learn, very reliable and safe, that was very challenging.
6. Will the Obama administration’s dedication to revamping the healthcare industry have an effect on NxStage?
We embrace the administration’s dedication to a revamped healthcare because of the advantages our therapy can bring. None of us know what the revamped healthcare means. We see ourselves as a company that can reduce healthcare costs and improve clinical outcomes, that’s what they’re talking about. It would seem that’d be good thing for us. We still have to see what they do, however. We feel good about it, but I don’t even know if they know how they’re going to deliver on all their promises.
7. Talk about the relationship your company has with Senator Ted Kennedy?
We’ve had a number of meetings with his staff over the last few years. We’ve tried to make sure he understands what opportunities and benefits there are to our system. He has been as good as an advocate as you want. As a local senator, he’s gotten out in front and tried to help us. He has an outstanding healthcare team. They are very well connected and engaged, after doing the work they should and need to do. He’s very willing to support good technologies and good companies.
A NxStage patient using the NxStage System One by the pool
8. Talk about your growth as a company?
Our revenue was approximately US $128 million in 2008. In 2007, our revenue was US $60 million, $20 million in 2006 and $6 million in 2005. We’ve had a rocketing growth rate which as you can imagine has been pretty exciting for the team.
9. You’ve also grown on an international stage, how have you expanded internationally and where do you look to grow?
We’ve just started to get those relationships intact. We recently announced a new relationship with a UK partner, Kimal. We’re taking on international opportunities, finding the right partners, getting the right product for those opportunities. We also recently announced a new relationship with an Asian company, Asahi Kasei. At the moment that’s more focused on operational rather than commercial. We’ll make our dialyzer for them under their label and they’ll provide the raw materials we need along with some capital. It’s a great relationship we want to expand over time.
10. Where do you see NxStage heading in the next few years?
I think with the backdrop in Washington, combined with the advantages and capabilities NxStage technology has, we have a lot of potential and we’re excited to see where that can lead. We need to keep executing against our plans and initiatives to grow the market and expand our presence. We’re at the starting line, getting ready, we’ve stretched a little bit and we’re waiting for the gun to sound.