Medical Equipment Business Plan

MedNexis will initially market its MedStim system to the atrophy prevention/treatment market, while the TheraMag system will be marketed to the alternative medicine market. The primary differences between these two products will be the amplitude and frequency of the magnetic field generated and the programmability/capability of the logic controllers. The amplitude of the magnetic field generated by the TheraMag system will be significantly less than that generated by the MedStim system in order to avoid functional stimulation of the underlying muscles. The frequency of stimulation, though, will be greater in the TheraMag system in order to provide a more consistent therapeutic magnetic field desired for alternative medicine applications.

Both systems will be sold in two parts, the programmable logic controller (LC), which will generate the electrical impulses, and the array of overlapping coils (AOC), which will generate the magnetic fields. The AOC will be available in multiple designs, each of which will contain the signature overlapping coils and will be simple to apply. Every design will be available in multiple sizes to accommodate patients of various dimensions. The technology used in these products is the subject of a patent which is currently in the application process.

3.1 Product Description

A detailed and technical description of both the MedStim and TheraMag systems follows:

Therapeutic Magnetic Field Generators: The MedStim and TheraMag Systems

Applications: The prevention/treatment of muscular atrophy in conditions resulting in immobilization and the generation of a non-stimulatory magnetic field for alternative medical therapy purposes.

Scope: This innovation applies to both stimulatory and non-stimulatory magnetic field generation used in the treatment of a variety of diseases and ailments. The MedStim and TheraMag systems are two-component devices designed to deliver a powerful magnetic field to the subcutaneous tissue. The logic controller (LC) generates the electrical current impulse through powerful capacitors and the array of overlapping coils (AOC) provides the necessary pathway for the current to generate the desired magnetic field.

Current Technology:

Atrophy Prevention/Treatment

Currently bulky, difficult to use technology exists which provides for therapeutic, functional stimulation of musculature using magnetic induction of neural impulses. These devices, though, consist of only a single focus of stimulation and must be manipulated by a trained, experienced user in order to effect a useful therapy. The main limitations of the existing magnetic stimulation devices are:

• Inability to treat multiple muscle groups, or even adequately treat a single muscle group, without a highly skilled, trained operator manipulating the device throughout the lengthy process.
• Inconsistent treatment regiments which are time intensive and costly due to the necessary continued presence of the trained operator.
• Limited effectiveness due to lower ranges of both gauss (a rating of the strength of the magnetic field) and joules (a measure of the actual energy flowing through the coil).

There is also technology which stimulates musculature using transdermal electrical stimulation. Electrical stimulation is a well-developed field in sports medicine and this form of therapy is currently widely used. The main limitations to electrical stimulation are as follows:

• Stimulatory levels of electricity are frequently painful and may result in contact burns.
• Muscle groups that can be stimulated are restricted to those which are superficial and easily reached transdermally. Deep muscle groups cannot be stimulated without more powerful electrical impulses which cause significant discomfort. Due to this limitation, stimulation of superficial muscles is usually submaximal as well.

Alternative Medicine

There is currently technology for providing non-stimulatory magnetic fields for alternative medicine applications, but none with an overlapping series of coils activated by powerful capacitors. The main limitations of current non-stimulatory magnetic field generators are as follows:

• Limited strength of magnetic field due lack of powerful field induction mechanism.
• Inability to penetrate deeply throughout the treatment area due to discreet, nonoverlapping magnetic field generators of lesser power.
• Difficulty of use due to constant manipulation of the single coil required to treat any significant region of the body.

MedNexis Technology:

In generating a magnetic field, impulses of electric current originating from the LC flow through the AOC in a predetermined sequence. The flow of electrical current through the coil induces a strong magnetic field (Faraday’s Law), which in turn induces a current in motor neurons perpendicular to the magnetic field, causing involved muscles to contract. Sufficient muscle activity is induced to prevent atrophy of the muscle group affected. Therapeutic stimulation of peripheral motor neurons and muscle tissue for the prevention of atrophy and/or the augmentation of muscular mass may be clinically indicated for a variety of medical conditions including fractures immobilized beyond 2 weeks, Induced Paralysis for Mechanical Ventilation, Persistent Vegetative State, Traumatic Paralysis, and Guillain-Barre Syndrome. Potential indications now being researched include: bone healing, preventing deep venous thrombosis, and increasing range of motion.

Logic Controller- Requires both a powerful 40,000 microFarad capacitor and a 2:1 step-up transformer capable of generating 250 Volts for the MedStim system. A less powerful (and less expensive) 10,000 microFarad capacitor will be sufficient for the TheraMag system and a transformer will not be necessary. Both systems will require multiple discrete discharge channels so that coils in the AOC may be activated individually. A standard 110 Volt power source will be needed to generate the necessary electrical impulses. Any channel not being used for stimulation will be grounded to prevent electrical interference of the stimulated coil. The frequency and amplitude of stimulation will be determined by the Logic Controller console. (See Fig.1, 2, and 3 in Appendix)

Array of Overlapping Coils- Each copper insulated coil in the series will be connected to a single channel on the Logic Controller. Current, will flow in through the logic controller with discharge of the capacitor then out through a grounded lead in the logic controller. The firing of individual coils will occur in a rapid, yet controllable, sequence and, in the case of the MedStim system, will result in the stimulation of motor neurons in the subcutaneous tissue perpendicular to the induced magnetic field.  (See Fig.1 and 4 in Appendix) 

Clinical Advantages:

Atrophy Prevention/Treatment

The main clinical advantage of the MedStim system is that it is able to provide maximal stimulation of deep musculature without significant discomfort to the patient. This is in direct contrast to the frequently painful, submaximal electrical stimulation currently used. The LC is an easy-to-program device and the AOCs are easily applied in any environment, making them an attractive option in home health situations. Due to its ease of application and use, the MedStim system will provide a means of preventing, not just reversing, disuse atrophy with daily use on immobilized patients. Also, as additional indications arise for magnetic field therapy, the MedStim system will be in an ideal position to fill these needs due to its highly consistent, thorough generation of pulsed magnetic fields.

In summary, the clinical advantages of the MedStim system are:

• Magnetic field generated is safe, comfortable, and effective, even in the stimulation of deep musculature.
• Logic Controller is easy to program and operate, allowing for possible home health applications.
• Array of Coils is easy to apply so as to provide effective, maximal stimulation of the underlying musculature with no need for a highly skilled operator once settings on logic controller are established.
• Array of Coils can be used multiple times on a single patient, helping to make the device more cost-effective.
• Flexibility of configuration of Array of Coils allows treatment of a variety of conditions including systemic processes, such as Guillain-Barre, and local processes such as isolated fractures.
• Use of the MedStim system will result in a more rapid return to functionality for patients and will decrease subsequent Physical Therapy required after the period of immobilization. Due to these factors, implementation of the MedStim system is a cost-effective therapy.

Alternative Medicine

It is postulated, that there are less well-defined benefits to magnetic stimulation, such as increasing blood flow, activating the immune system, and promoting wound healing. This will allow entry of the TheraMag system into the alternative medicine market in an altered form in which maximum magnetic fields generated will be non-contractile to underlying musculature. The TheraMag system, though, will still be able to provide magnetic stimulation greater than any device currently available in the alternative medicine market in a more user-friendly fashion.

In summary, the clinical advantages of the TheraMag system are:

• Flexibility and ease-of-use identical to the MedStim system.
• Generation of dynamic magnetic fields with greater amplitude than existing devices in a systematic and controlled manner.
• Competitive price structure

3.2 Competitive Comparison

Atrophy Prevention/Treatment

Current competition for the MedStim system consists mainly of the following devices: Neotonus’ Neotone, MagStim’s Model 200, 220, 250, and Quadropulse 500. These devices use pulsed magnetic fields to induce muscular contraction.  The base cost of Neotone, MedStim’s primary competitor, is $20,000, while MagStim’s model 200 starts at $19,800. What these devices lack, though, is an easy-to-use, cost-effective means of inducing this contraction. Due to the fact that all of these devices employ a single, focused coil in inducing muscular contractions, they also require a skilled, trained user at the controls. While this may be practical for diagnostic purposes, which is the main use of the MagStim devices, it is not cost-effective for the treatment of atrophy, and it is surely not cost-effective for the prevention of muscular atrophy. In summary, the key advantages of the MedStim system over Neotonus’ and MagStim’s devices are:

• Much easier to use and apply with possible applications in a home healthcare setting.
• Allows for a more consistent therapy due to ergonomic wrap targeting key nerves and no requirement for a highly trained operator to constantly manipulate the device for adequate therapy.
• Allows treatment of multiple sites in a sequential, timely fashion due to multiple ports on the logic controller and multiple coils stimulated by each port, as opposed to the single stimulatory coil of competing devices.

The only other main field of competition for the MedStim system is the alternative electrical stimulation technology, which is considered less effective. To summarize, the key advantages of the MedStim system over electrical stimulation are:

• Magnetic field generated is safe, comfortable, and effective, even in the stimulation of deep musculature.
• Logic Controller is easy to program and operate, allowing for possible home health applications with leasing of the system.
• Array of Coils is easy to apply so as to provide effective, maximal stimulation of the underlying musculature.
• Array of Coils can be used multiple times on a single patient, helping to make the device more cost-effective.
• Flexibility of configuration of Array of Coils allows treatment of a variety of conditions including systemic processes, such as Guillain-Barre, and local processes such as isolated fractures.

Alternative Medicine

The TheraMag system is also a new innovation whose competition will include currently existing alternative medicine magnetic field generation devices. Key advantages of the TheraMag system over these devices are:

• Flexibility and ease-of-use identical to the MedStim system.
• Generation of magnetic fields with greater amplitude than existing devices in a systematic and controlled manner.

3.3 Sourcing

Primary raw materials needed for MedNexis products are as follows:

• Electrical components (capacitor, wiring, etc) for Logic Controller and Arrays of Coils.
• Molds for external console of Logic Controller.
• Material for wraps in which induction coils will be placed.

All of these components are easily sourced and multiple suppliers have been identified. MedNexis will establish business relationships with these suppliers to be negotiated for preferred pricing structures without compromising quality standards. Two viable manufacturers have been identified: Colorado MedTech in Boulder, CO and JCD Manufacturing in Nashville, TN. Both companies specialize in manufacturing electronic medical equipment.

3.4 Technology

A patent has been authored and filed for the MedStim and TheraMag systems. This patent takes into account both offensive and defensive postures in its claims. Opinions of legal counsel are strong that MedNexis’ patent applications are enforceable and defensible.

Care has been taken to file all potential claims of the invention in order to protect it from possible competition from other technologies.

All patent application documents will be made available for examination by potential investors. Trademark applications are in process on the names MedStim, TheraMag and MedNexis. No conflicts or other use of these names has been found in an initial search.

3.5 Future Products

Plans for future development by MedNexis include new concepts and technologies to be created by the company. For example, the company intends to expand its MedStim line by introducing more specialized products that offer highly technical users more sophisticated features, such as advanced logic controllers that provide enhanced control and generate detailed patient data relative to current and past treatments.  These units will also incorporate more durable componentry. 

Additionally, the company will expand its TheraMag line by developing new products tailored to specific consumer segments, as well as alternative medicine providers such as wellness centers.  In addition, MedNexis may seek to acquire technologies developed by other companies and individuals to strategically achieve market penetration and additional business for the company, once it attains sufficient capitalization to do so. It is the objective of MedNexis to both innovate and market its products to other potential market segments and geographical regions. Once an industry reputation has been achieved and marketing channels are feasible, expansion into other medical device areas should be highly rewarding.