Israeli Firm Obtains Funds to Bring GI Devices to Chinese Market

Domain Elite partnership says it has invested $6.5 in Smart Medical Systems, an Israeli company with innovative endoscopy and colonoscopy products, as part of a multi-phase effort to move Smart Medical’s gastrointestinal technologies into China, Hong Kong, and Taiwan.

“The mission of Domain Elite is to find the most effective medical technologies to fulfill important unmet medical needs and improve healthcare in China,” said Brian Halak, partner at Domain Associates and founder of Domain Elite. “In so doing, Domain will create unique investment opportunities in the rapidly growing Chinese market. SMART Medical Systems has an innovative and well-validated technology that we believe accomplishes both goals.”

Smart Medical, founded in 2005 in Ra’anana, Israel, has developed an approach that incorporates balloon catheters in the design of its endoscopes and colonoscopes — medical devices that use a flexible tube equipped with a camera to look at the inside the human digestive tract. An endoscopy procedure examines the upper gastrointestinal (GI) tract (the esophagus, stomach, and small intestines) while a colonoscopy looks at the lower portion of the GI (large intestine, colon, and rectum).

In the United States, such examinations are used mostly to screen for signs of cancer along the inner wall of the GI tract. The device used in the exam also has a tool that can be used to remove pre-cancerous polyps in the gut.

Smart Medical’s flagship product is designed with a balloon that can be inflated to make it easier for doctors to find pre-cancerous polyps, which can be obscured by the natural folds of the colon. The company, which has a subsidiary in Hong Kong, also has designed another balloon device that attaches to the end of its endoscope, so doctors using the device can advance the endoscope faster and farther into the gut.

Procedures that usually require general anesthesia and can take 60 minutes or longer can be done using Smart Medical’s technology with local anesthetics in 15 to 20 minutes, according to Smart Medical CEO Gadi Terliuc.

“We see it as a much-easier procedure for physicians,” Terliuc said. “The physician training is easier, and the procedure itself is much less expensive.”

Cancer is the most common cause of death in China, and colorectal cancer has become the second most-frequent type of cancer, Zimmerman said. Early screening and detection can make a big difference in the survival rates of patients diagnosed with colorectal cancer.

Endoscopies and colonoscopies are fairly common in the United States (about 15 million colonoscopies are completed annually in the United States), but Domain Elite CEO Micah Zimmerman said such procedures are still relatively new in China. He said the Chinese market for such procedures is growing by 30 percent to 40 percent a year, and predicts that growth will continue in China for years to come.

Smart Medical’s technology is currently marketed in Europe, and two of the company’s three products have been cleared for use in the United States. Terliuc said the Domain Elite investment also would help the company advance its related technologies in the United States and other global markets.