May 11, 2002
Johnson & Johnson unit to market IMI's cardiac risk test
Goal is to introduce a 'home version' for sale at pharmacies
Michael Lewis
Financial Post
A Toronto-based developer of screening tests for cancer and heart disease says it
has signed an agreement that will see a unit of consumer health care giant Johnson
& Johnson Inc. market its cardiac risk assessment product in Canada.
IMI International Medical Innovations Inc. said yesterday that McNeil Consumer
Health Care will distribute the test first to cardiologists and other physicians with
significant cardiac practices. Ultimately, the goal is to introduce a "home version" for
sale to consumers over-the-counter at retail pharmacies.
Brent Norton, IMI chief executive, said McNeil will buy the test product and pay IMI a
royalty on sales, in addition to so-called milestone payments based on performance
and other factors. He would not disclose terms but said payments will be at the
high end of the industry norm.
Sales of the screening test would represent IMI's initial revenue from the product,
which was cleared for commercial launch in Canada in early 2001. Called
Cholesterol 1,2,3, the test has been show in clinical trials to be more reliable than a
blood sample in detecting clogged arteries, a frequent cause of heart failure.
IMI says Cholesterol 1,2,3, is a three-minute skin application that does not require
fasting, lab testing or a blood sample. Instead, liquid drops on the palm of the hand
are examined for evidence of cholesterol deposits, with surface cholesterol residue
seen as a more direct indicator of heart disease than deposits within artery walls.
IMI says it is developing a second-generation prototype for the home market that
could involve a test strip that turns colour on contact with cholesterol residue.
The current test, which IMI calls the first non-invasive test system to use skin
cholesterol to assess coronary artery disease risk, relies on a doctor's colour
scanner and computer. IMI said the home product could sell for around $10 per kit
-- and at least part of the cost may be eligible for reimbursement under Canadian
medicare and drug plans.
Mr. Norton said IMI will maintain manufacturing control, though McNeil under terms
of the renewable 15-year deal will participate in product development. He said the
agreement with Guelph, Ont.-based McNeil could pave the way for other marketing
and distribution pacts outside of Canada, perhaps with other affiliates of New
Jersey-based Johnson & Johnson.
A key, however, remains approval from the U.S. Food and Drug Administration, with
response to IMI's application expected within weeks.
Assuming regulatory clearance, IMI says it plans to pursue marketing deals in the
U.S. and Europe aimed at introducing the test strip to the mass consumer market.
According to a report from New York-based research firm Theta Reports, more than
600-million cholesterol tests were performed globally in 2000, with the market
expected to grow over the next two decades by more than 20% per year. Under
the pact, IMI says McNeil gains exclusive rights for the Canadian market to both the
professional skin cholesterol test system and the eventual home version. Canada is
the first market in which the product is commercially available. |
