This is how industry clusters are born.
A confluence of Orange County’s substantial healthcare industry, venture capital and higher education has led to a growing roster of local companies targeting the multibillion-dollar glaucoma market.
They range from brand names that get hundreds of millions of dollars in revenue from glaucoma products to pre-revenue startups drawing big investments.
Glaucoma is an incurable eye disease that damages the optic nerve and is a leading cause of blindness. It is incurable, but some cases of vision loss can be stopped or slowed with drugs or surgery.
Pursuing glaucoma treatments is attractive to businesses and venture capitalists because of the market’s sheer size—the disease affects more than 65 million people worldwide.
Analysts have estimated the yearly drug and surgery market for treating glaucoma at about $4.5 billion.
Drugs currently claim most of the market.
Irvine-based Allergan Inc. and Abbott Medical Optics Inc. in Santa Ana are among the biggest companies in the local industry.
Allergan has an established franchise in glaucoma drugs, including Lumigan, Alphagan P and Combigan. Those accounted for $242.4 million, or about 19%, of Allergan’s total product sales of in the first quarter.
The drug maker is “reloading” its pipeline for longer-term growth and glaucoma drugs will outnumber others, according to Allergan Chief Executive David Pyott.
Abbott Medical, a unit of Chicago diversified drug and device maker Abbott Laboratories Inc., is on the surgery side of the market with its Baerveldt glaucoma implant.
Abbott Medical got the Baerveldt shunt—invented by University of California, Irvine professor George Baerveldt—as part of its 2004 buy of Pfizer Inc.’s eye surgical business for $450 million.
Treating glaucoma is “a marathon, not a sprint,” said Abbott Medical President James Mazzo.
One goal for Abbott’s glaucoma strategy: reducing dependence on drugs by combining them with medical devices.
“It’s a home run … the patient wins, the doctor wins and the government wins,” Mazzo said.
Medicare, the federal insurance program for senior citizens, often pays for glaucoma treatment.
Rochester, N.Y.-based Bausch & Lomb Inc. has an eye surgery hub in Aliso Viejo. It doesn’t make any glaucoma products but considers it “an area of strategic interest,” according to a spokeswoman.
The middle ranks of local glaucoma companies include Irvine-based drug maker Ista Pharmaceuticals Inc., which makes the Istalol beta-blocker drug.
Big War Chest
Glaukos Corp. in Laguna Hills is a smaller company with a big war chest to work on tiny devices that are implanted in the eye to treat glaucoma.
Glaukos has “devices that we’ve developed over several years to treat the full range of glaucoma,” Chief Executive Tom Burns said in an earlier interview.
The company has raised $126 million, including $29.5 million in a fifth round of financing in late January.
Its main product, the iStent, is being sold in Europe and Canada. It’s now under review by the Food and Drug Administration after receiving a favorable vote a year ago from a preliminary panel of the agency.
IStent is a 1-millimeter implant that is placed in the eye and diminishes pressure by relieving fluid buildup. It’s thinner than a human hair.
An example of the benefits of the local cluster can be seen in Glaukos’ management team. It’s stocked with veterans from other drug and device makers in the area, including Allergan and Abbott Medical.
Burns worked with Allergan before being tapped by William Link, a seminal figure in the county’s medical device venture capital field. Link brought him into Chiron Vision Corp., an eye surgery company that was based in Irvine before being acquired in 1997 by Bausch & Lomb for $310 million.
Chief Commercial Officer Chris Calcaterra spent several years at Advanced Medical, which became part of Abbott Laboratories in a 2009 deal.
Another former Advanced Medical executive, Ron Bache, is at the helm of AqueSys Inc., an Irvine company working on a surgical implant for treating glaucoma.
The implant is placed in a patient’s eye with an insertion device and sterilized needle, similar to intraocular lens implants for cataract surgery.
The device drains fluid out of the chamber behind the cornea to lower eye pressure, Bache said.
Ivantis Inc., also based in Irvine, recently picked up $17 million in venture capital funding to help develop its lead device, the Hydrus scaffold for treating glaucoma. Hydrus is about the size of an eyelash and is implanted into a glaucoma patient’s eye in a minimally invasive microsurgical procedure.
The county’s glaucoma drug and device history, as with several other clusters in the local healthcare industry, stretches back some years.
“Since the early days of AMO, Allergan and Chiron Vision, (the county) has had an extensive activity in surgical ophthalmology,” said Link, a Newport Beach-based managing director of Versant Venture Management LLC and chairman of Glaukos.
Link has invested in various ophthalmic startup companies since 1998.
“The field of surgical glaucoma in (Orange County) was facilitated by the collaboration of industry, venture capital and academia,” he said.
That includes UC Irvine and a churn of startups, according to Baerveldt.
The UCI professor developed his glaucoma device in the 1980s. He sold the device, which went to various companies before being acquired by what became Abbott Medical.
Baerveldt began teaching at UCI “because I needed to be near the startup companies.”
“If you’ve got an idea, I found that you have to work extremely closely with the startup company, their engineers, to develop the product,” Baerveldt said.
Another Baerveldt glaucoma device, the Trabectome, is sold by NeoMedix Inc., which is based in Tustin.
NeoMedix Chief Executive Soheila Mirhashemi said she learned of the Trabectome after Baerveldt diagnosed her mother with glaucoma. The company licensed the device from Baerveldt in 2003.
Allergan History
Allergan also played a big role in the glaucoma industry, said Mazzo, who spent 22 years with its medical optics unit before it was spun off as Advanced Medical Optics. Abbott Laboratories later bought the company and dubbed it Abbott Medical Optics.
Mazzo cited the late Irving Leopold— who headed Allergan’s medical affairs division and was a UCI researcher—as a driving force.
“Irv really established Allergan’s R&D program and spent a lot of time in glaucoma,” Mazzo said. “Allergan has a rich history there.”
