About 100 meetings with investors before hitting the jackpot. This is what happened to Biomendex, a Tampere-based company that manufactures a bone graft substitute named Adaptos. Last summer, the European Innovation Council awarded the company a grant of €2.2 million after a tight application process.
The candidates were invited to present their business ideas to a strict panel of investors. “They put quite a lot of pressure on us,” says Kaarlo Paakinaho, company founder and CEO. “We had exactly 10 minutes to present our idea, not a second more. Then we spent the next 20 minutes answering tough questions on greatly varying subjects.”
More than 2,000 companies from various fields took part in the funding application process, and 189 qualified for an interview. In the end, the funding was granted to less than 100 companies. Biomendex received the grant on its first attempt, even though most companies need to apply for it 3–5 times.
“We would not be here if we had not already had around 100 meetings with investors. After each meeting, we analysed what we had heard and then used the information to modify our business plan,” says Heidi Hinkka, CFO of Biomendex Oy.
With the EU funding, Adaptos can be subjected to the necessary clinical trials. The company will also recruit more employees and look for new premises. “According to the current EU regulation, a product must be tested with patients and subjected to at least a small clinical trial before it can be launched on the market,” Heidi Hinkka says. “We have budgeted the trials and tendered them out globally, and they are soon starting in a few different countries.” Adaptos is also involved in the Orton Foundation’s ongoing technical research, which will provide reliable information about the product’s properties.
A product that fits the surgeon’s hand
Kaarlo Paakinaho started developing the material when he worked as a university researcher in 2007. The ingredients are already in use with patients, but the manufacturing method creates the material’s special properties with the help of supercritical carbon dioxide. In other words, advanced production methods and Tampere-based top expertise have resulted in the creation of something entirely new from familiar, tried and tested materials.
Adaptos is elastic, so the surgeon can easily shape it into the desired form. The material is porous, so the patient’s own bone tissue and blood vessels can grow inside it. The body will eventually replace the material, which is biodegradable,” Kaarlo Paakinaho describes.
Indeed, usability has been one of the cornerstones in the creation of Adaptos. The Biomendex team includes orthopaedist Mikko Manninen, who brings a physician’s perspective and competence to the development of the product. Kaarlo Paakinaho notes that many people have been surprised when holding a piece of artificial bone in their hand. It looks hard but softens in the hand and is resilient. Bone graft substitute granules can be used if patients do not have enough bone of their own. “If surgeons think that a product doesn’t feel good, they won’t use it. In that case, the company stands no chance of success,” Kaarlo Paakinaho says. “Surgeons are craftspeople who make decisions and adaptations even during operations. We want to give surgeons the freedom to choose their working methods without being hindered by the limitations of the product.”
Using Adaptos may make operations easier and quicker. User experiences are constantly needed, and Heidi Hinkka encourages surgeons to get in touch if they would like to get to know the product. While the Biomendex bone graft substitute must meet the expectations of physicians and also shows great promise in terms of the smoothness of operations, the ultimate goal is to benefit the patient. “If more bone is needed to repair a bone fracture, it is taken from the patient’s pelvis,” Heidi Hinkka says. “Often, the fracture heals but there are problems in the part of the body where the bone graft was taken from. We hope to get rid of this treatment method in the future, replacing bone graft with a substitute.”
Tampere as a growth platform
Biomendex strongly identifies itself with Tampere and also intends to stay in the city. The company is currently looking for premises on the Kauppi campus. According to Hinkka and Paakinaho, the location near the hospital and other local actors works well.
“We want to create a winning product here for the world together. Tampere and the Tays area offer a good hub-like environment for health technology companies,” Heidi Hinkka notes.
Hinkka and Paakinaho say that Biomendex is not seeking quick profits by making a straight jump into lucrative spinal surgery. Instead, they have decided to climb the ladder of development one step at a time while collecting research data to support the product. “The product is first used on animals, and over 20 animal patients have already been successfully treated with Adaptos”, Kaarlo Paakinaho says. “Then we plan to start using the product phase by phase for dental surgery, the jawbone, limbs and finally the spine.”
Biomendex’s marketing plan is to rely on scientific research. According to Heidi Hinkka, the strategy is to convince leading orthopaedists with the help of the research results.
The art of attracting investors
The road from the original invention to the present day has been long and winding. At first, Kaarlo Paakinaho developed the material in his leisure time, then with the support of various projects and types of financing. He completed his doctoral dissertation in 2013, and orthopaedist Mikko Manninen got involved in the same year. They were joined by Heidi Hinkka in 2016, and Biomendex was founded in 2018. There have been many challenges along the way.
“Since it is implanted into the human body, Adaptos is a product at the highest risk level, which made it difficult to find suitable investors,” Heidi Hinkka says. “It is always possible that investors decide to withdraw, even during the final stages of negotiations. Many investors shun projects that get under the human skin.”
Investors wanted to closely examine all the materials available before making the investment decision, and some complex investment arrangements crumbled because an investor retreated. There has been a lot of hard work, and entrepreneurship has demanded commitment and flexibility, also from family members and friends. For example, sometimes it has been necessary to leave for Helsinki at three hours’ notice. “99 per cent of the meetings result in disappointment, but we have tried until we succeed,” Heidi Hinkka says. There must always be plans B, C and D in case Plan A fails.
Photo: Anna-Mari Martikainen