Memorandum

Cellnovo licenses TypeZero’s inControl AP for inclusion in patch pump; hybrid closed loop launch ambitiously expected in 2018 – April 18, 2017

Executive Highlights

  • Cellnovo has signed a non-exclusive worldwide licensing agreement with TypeZero, giving it the right to integrate and commercialize TypeZero’s Artificial Pancreas technology with a Cellnovo patch pump.
  • Cellnovo ambitiously expects a launch in 2018 (presumably in Europe), and integration efforts are already underway. A lot of strong execution will be needed to hit that timing. The Cellnovo-TypeZero partnership was first announced at ATTD 2016, though this update now offers a path to commercialization.
  • With this deal, Cellnovo gets a very proven automated insulin delivery algorithm to incorporate into its patch pump, and if it does launch in 2018, might be a second- or third-to-market system in Europe (see our AID landscape here). TypeZero gains another pump partner (beyond Tandem) vying to commercialize its algorithm technology.

This morning, Cellnovo announced that it has signed a non-exclusive worldwide licensing agreement with TypeZero, giving it the right to integrate and commercialize TypeZero’s Artificial Pancreas technology with a Cellnovo patch pump. Ambitiously, Cellnovo expects a launch in 2018 – presumably in Europe – and integration efforts are already underway. No financial terms have been disclosed, but presumably the structure and details are similar to the Tandem/TypeZero agreement announced in July 2016 (also not disclosed). 

Cellnovo and TypeZero have not shared pivotal trial timing. Their partnership dates back to ATTD 2016, which originally planned for the Cellnovo pump to be part of the International Diabetes Closed Loop study (also serving as the US pivotal for Tandem/TypeZero product). However, the iDCL ClinicalTrials.gov page does not list Cellnovo as a collaborator, and Dr. Boris Kovatchev only talked about Tandem at ATTD. Perhaps Cellnovo and TypeZero will pursue another trial to get this product approved, or perhaps Cellnovo’s pump will be included after all.

The TypeZero algorithm will be incorporated directly into Cellnovo’s Bluetooth-enabled (on-body) patch pump, which presumably means patients will remain in closed loop even if the handheld is out of range – this is also Insulet’s approach with its OmniPod Horizon system. No CGM partner is specified in the press release, but we assume it is Dexcom.

The news is a major positive for Cellnovo, who gets a proven automated insulin delivery algorithm to incorporate into its patch pump, and if it does launch in 2018, could be a second- or third-to-market system in Europe (see our AID landscape here). We’d note that Cellnovo has had a very slow ramp to commercial and manufacturing scale, and cash is an ever-present concern for the young company in a competitive environment. For this product to come to market as expected, execution will need to be excellent on the regulatory, reimbursement, manufacturing, and management fronts. (Cellnovo’s patch pump is also under FDA review, with a US launch previously expected by the end of 2017. This is a worldwide licensing agreement, though to launch in 2018, we assume Europe will be the initial focus.)

TypeZero also clearly wins from this deal, as it now has at least two pump partners – Tandem and Cellnovo – vying to commercialize its algorithm technology. If both systems actually make it to market, we wonder how the user experience will differ, what patients will prefer, and how these systems will stack up to others. A strength of TypeZero’s inControl AP system is automatic correction boluses, something the MiniMed 670G will not have at launch.

Overall, we’re glad to see a commercial agreement in place for this partnership, suggesting a product may indeed come to market. Separately, Cellnovo is partnered with Diabeloop, though our understanding is that Diabeloop will commercialize the system and integrate the components (of which Cellnovo’s patch pump is one; see Diabeloop’s ATTD 2017 data).

It’s a very competitive time in insulin delivery, and we’re glad to see multiple systems with the potential to come to market and compete on glycemic outcomes, diabetes burden, user experience, and cost. Innovation will absolutely drive this field forward, ideally improving the benefit-burden balance of diabetes tech. Can AID systems become “must-haves” for the majority of intensive insulin users, busy healthcare providers, and cost-focused payers? How many pump/AID companies can the field support?

Close Concerns Questions

Q: When will a Cellnovo/TypeZero pivotal study take place and where?

Q: Will Cellnovo be part of the iDCL study, or will the companies pursue a separate pivotal trial?

Q: Is the expected 2018 launch in Europe, the US, or both?

Q: Will the algorithm be embedded in Cellnovo’s pump, meaning if the handheld is out of range, the patient will still be in closed loop?

Q: Will this use Dexcom CGM?

Q: For Cellnovo, what is the relationship and deal terms with Diabeloop vs. TypeZero? Is it correct that Cellnovo commercializes in this case (utilizing TypeZero technology), while Diabeloop will commercialize its own system with Cellnovo as a component?

Q: Will Cellnovo launch in the US by the end of 2017, as previously expected?

 

-- by Adam Brown and Kelly Close