Juvent Shaking Up The Medical Device Sector

INTERVIEW OF THE WEEK John Moroney, chief executive, Juvent

BORN in Waterford, John Moroney may have lived for almost 34 years in the US, but he has not forgotten how to express himself as Gaeilge.

Mr Moroney headed for the States after attending the Christian Brothers in Dungarvan and in the intervening three decades has had a career in banking, corporate advice (mainly to healthcare companies), and is now chief executive of medical device company Juvent.

These days he speaks with a soft American lilt and his language is mainly financial, but he still manages to come to Ireland up to six times a year and has not fully lost his Irish accent.

Juvent will bring him back to Ireland again later this year when he plans to float the firm in Dublin. The flotation is primarily planned for the American Stock Exchange (better known as Amex) but there are plans for secondary listings on London's AIM and Dublin's IEX (Irish Enterprise Exchange).

Juvent's product, which looks for all the world like a weighing scales, is marketed as the only drug-free product to strengthen bones. The Juvent 1000 is mainly aimed at people who have osteoporosis and osteopenia.

The user stands on it and it gently vibrates. This stimulates the skeleton, which in turn helps bones grow stronger, the promoters say.

Although operating out of New Jersey, Juvent is manufactured in Waterford by Hitol Precision Engineering. It happened purely accidentally that the product ended up being made in Mr Moroney's home county, he says. Juvent was introduced to Hitol by Enterprise Ireland after settling on Ireland as the manufacturing base because of low corporation tax and membership of the EU.

The device has been approved for use in the EU, and a major trial is about to be conducted in the US. Distributors have been appointed in Britain, Germany, Turkey, Israel, Australia and New Zealand.

Originally developed over the past 15 years by two professors at the State University of New York, the device was acquired in 2002 by Mr Moroney and Juvent from medical devices giant Smith & Nephew.

The Juvent boss said that his company, which is 40%-owned by its management, is planning to raise around $20m from the IPO process.

The US Army is currently investigating the use of the technology, as it is concerned at a high level of bone fractures among boot-camp recruits.

It is funding a number of trials being carried out by the Los Angeles Children's Hospital.

And NASA, which was an early backer of the project, has selected the product for use on the International Space Station in 2007. Astronauts suffer bone loss from zero-gravity conditions.

The concept behind the product has already received endorsement from the medical community. A recent article in the 'Harvard Women's Health Watch' was headed: "Small vibrations can improve bone, increase muscle mass."

Consultant at St James's Hospital and Trinity College Professor Bernard Walsh, speaking at the launch of the product in Dublin last week, said he has one of the devices in his clinic. He described Juvent 1000 as a "potential extra tool" in the treatment of bone diseases like osteoporosis.

As a 6% shareholder in Juvent, Mr Moroney will be hoping that the Juvent product will further strengthen his bank balance.

"A thing I learned in commercial banking is that banks only give money to companies that don't need it."

This came home to Mr Moroney when, still a banker, he started a profitable sideline in helping to raise funds for early stage generic drugs companies.

Eventually, this became his full-time job when he set up Landmark Financial, a provider of corporate finance to emerging healthcare companies.

In the late 1980s Landmark became so successful that he was asked by one of the oldest investment banks in New York - Ladenburg, Thalmann & Co - to head up their healthcare division. Now he has tapped some of his old contacts to fund Juvent. The company is largely owned by its management, with other backers made up of orthopaedic surgeons and high net worth individuals.

Mr Moroney maintains that the opportunity for Juvent is huge.

"This is the first bone growth stimulation product. In the US, 10m people have osteoporosis, with another 34m at risk. If they break a hip, there is a 20% chance of them dying."

The emphasis now is on a major FDA (Food and Drugs Administration) trial in the US for bone strengthening. The product already has FDA approval as a treatment to help blood flow. Funding is now the priority.

"We are like a race car at the start of a race. We need fuel and that is where we are at."

Mr Moroney is hoping that the flotation later this year will kick-start the race to made the Juvent 1000 a leading product in the treatment of brittle bones.