By: Ohad Schwartz
CEO

CoreBone

CoreBone has developed a breakthrough coral-derived bone graft that offers a natural alternative to the current human- and animal-derived materials to target the $4 billion global market for dental and orthopedic bone graft substitutes.

$632,128

Raised so far

34

Investors

0

Days to go
Type: Equity  
Stage: Seed +
Category: Healthcare
•  Funded    
  • Campaign Highlights
  • Pitch
  • Team
  • Investors 34
  • Updates 2

Campaign Highlights

A Revolutionary Breakthrough Which Is Bioactive, Strong And Remodels 

The breakthrough development achieved by CoreBone relates to many of us who may need bone grafts now or in the future. CoreBone’s bone graft gives surgeons — and patients — an alternative to "spare parts" sourced from cadavers, either human or animal, and the option of adopting a new, natural and low- risk solution.

Most bone graft materials currently available in the market are derived from human and animal bone. Human products carry the risk of disease and rejection and face significant regulatory burdens in many countries. Animal bone products from cows or pigs (bovine or porcine) do nor resorb, which means they don't grow and aren't replaced by new bone, due to the heating process they undergo to eliminate viruses. Synthetic bone graft materials, on the other hand, lack strength.

CoreBone leverages natural bonelike qualities and presents a strong, bioactive, low-risk product, as well as a natural and environmentally friendly solution.

 

Patent-Protected Technology

CoreBone grafts are made from corals that are grown and cultured in the closed, monitored laboratory environment of its coral farm. The company carefully selected and tested special coral types to ensure suitability for bone grafting and efficient, cost-effective coral cultivation.

Patented technology (issued patents in the US and Israel; EU in process) embeds bioactive minerals (silicium) into the skeleton of selected coral types during the growth process, utilizing their bonelike qualities and adding bioactivity for accelerated healing and better bone connectivity. As a result, the CoreBone graft material offers the same bonelike qualities as organic material (human-derived) without the associated biological risks, and also grows at a rapid rate, over  10 times faster than usual.

 

Funding To Date 

CoreBone has received the support and funding of the Israel Innovation Authority (previously called Israel’s Office of the Chief Scientist) to develop its innovative solution. Among its investors are The Trendlines Group, a leading Israeli investor in early-stage medical devices and agricultural technologies. Trendlines was the most active (by the number of investments) Israeli life science seed stage investor in 2016. Additional investors in CoreBone are the founders and angels from Israel and abroad.

Trendlines Group logo

 

Novel Solution for a $4 Billion Market

The global bone graft market for the orthopedics and dental fields is estimated at $4 billion. It is growing as the global population ages and seeks better aesthetics and greater functionality. The dental market is growing at 11% annually as result of dental implant growth globally. Animal-derived bone leads the dental market. Bio Oss (Geistlisch), the cow bone-derived graft, is the sector’s leading product, with 25% market share. The orthopedics market, which represents 75% of the total bone graft market, is more mature and growing at 4.5%. Leading product categories in orthopedics are bone grafts derived from human bone.

Most people who undergo bone grafting procedures are unaware of the source of the graft: human cadaver or animal. CoreBone’s new, natural, efficient and cost-effective graft material offers an effective alternative to these products. 

CoreBone plans to penetrate selected markets, acquire significant market share and establish a natural and effective solution for the current market leaders.

 

Already Raising Interest and Excitement in the Market

Since its launch early this year, users and leading KOLs in the dental market have already given favorable reviews after using CoreBone, supporting the CoreBone system as a natural alternative to current cow (bovine)-derived products.

It offers a favorable solution to the growing ethically conscious, vegans and religiously observant segments. It also offers competitive pricing, about 30% to 40% below the price of market leaders.

Human-derived products are not commonly used in Europe due to regulatory burdens and public sentiments. Animal bone (bovine, porcine) are treated at high heat (some 1,000°C) to eliminate dangerous viruses such as mad cow disease. Such treatment prevents remodeling (replacement of the graft by the new bone). This is the main reason for the very limited use of animal bone in orthopedics.

CoreBone’s graft remodels as bone grows, enhances new bone cell attachment and the creation of new bone due to its novel, patent-protected development.

 

The World Is Ready for CoreBone 

Israel is regarded as a world innovation leader in the dental field. Several dental companies have been acquired by global leaders for substantial amounts.

CoreBone’s unique and innovative product, developed in Israel, commenced its market entry into the dental field. Launched at the International Dental Show in March 2017, the CoreBone graft has already produced sales in the tens of thousands of dollars -- and is expected to grow to the hundreds of thousands in 2018. 

          * It was found that CoreBone's product is 5 times stronger than the tested human bone.

 

Regulator-Approved and Ready for Marketing

CoreBone has regulatory approvals to market its products for dental and orthopedic indications in Europe (CE mark) and Israel. It is already marketed in the dental field, mainly in Israel and Poland; the company is in discussion with dental implant leaders and local distributors about entering new markets in Europe, South and Central America and Asia. 

CoreBone is in the process of fund-raising to expand its activities, enter new markets, generate greater sales and gain market traction, including FDA 510(k) submission approval in the US, an orthopedic clinical study and extensive marketing activities.

Pitch

The Idea

Rising environmental awareness around the world and the need for green, natural solutions has made an impact in medicine, resulting in a growing demand for friendly and ethical products. That has been at the background of CoreBone’s development, as current bone graft solutions are derived from human or animal bone, with their negative characteristics and associations.

Corals are known to make good bone graft material as they have similar physical and chemical structures to human bone. Indeed, coral-derived grafts have been in use for over 20 years in dentistry and orthopedics. However, these products are derived from the sea, prone to marine contamination and are not monitored over their growth conditions. Moreover, the Kyoto agreement declared coral as an endangered species and banned coral harvesting and trading. 

 

How Does It Work?

CoreBone grows its coral in a closed, monitored environment using distilled drinking water to create laboratory-made enriched seawater that not only adds bioactivity but prevents potential biological and chemical contaminants. 

Located in Israel’s Arava Desert, and far removed from any external marine environment, the CoreBone laboratory uses solar energy, among other methods, to successfully grow, harvest and process coral into medical products. 

 

CoreBone's Advantages

 

Competitor Comparison

 

Our Next Goals

Forecast - subject to updates

 

The Business Model

Typically, bone grafts are sold to dental and orthopedic surgeons, clinics and hospitals by medical device (implant) distributors or by the medical device companies (manufacturers)  directly.

Our business strategy is based on three modular phases: initiating our sales in the dental market via local global distributors and directly; signing distribution agreements with global strategic dental players after we reach some traction in the market; entering the orthopedic field. 

 

Stage 1: Sales

CoreBone markets products online and through distributors (implant companies and medical equipment companies). The company currently operates with three active distributors in the dental field: two Israeli companies and another Polish company. CoreBone is about to sign a significant distribution agreement with a leading company in Romania. In addition, the company has received numerous distribution requests for its products from leading distribution companies in France, the Czech Republic, India, Taiwan, Mexico and Argentina. There are a number of other countries in the process of being examined as well.


 

Stage 2: Cooperation with implant companies

CoreBone will sign global cooperation agreements directly with implant companies, is in initial negotiations with several leading bodies already underway, and has a first cooperation agreement already bearing fruit.

In addition, the company will start selling raw materials it manufactures -- coral for final processing -- in countries in emerging markets such as China and India.

 

Stage 3: The orthopedic market

CoreBone holds regulatory approvals to market its orthopedic products in Europe and Israel. At the same time, this market is more institutionalized than the dental market and is controlled by global companies. In order to penetrate with a new product into the orthopedic market, institutionalized clinical research and collaboration with leading orthopedic agents is required. CoreBone has already received several requests from orthopedic distributors in Europe and India.

CoreBone also began planning a clinical research at the Sourasky Medical Center (Ichilov), a study that will progress at the end of the induction. Another study using a European CRO (clinical trial management body) is in the planning stages. Initial results of the study are expected to be received approximately six months from commencement. Success in the clinical trial will advance CoreBone's orthopedic product, in a significant step towards commercial scale production and marketing.

CoreBone has already signed a confidentiality agreement with several leading global orthopedic companies.

The Market

Dental Market

Product Sales

The global dental market is mainly private pay. CoreBone markets its products through distributors and directly to leading dental clinics worldwide. Currently, the company operates with three distributors in Israel and Poland. Numerous distribution requests have been received and are in negotiation from France, Romania, Spain, Portugal, India, Taiwan, Mexico and others.

Strategic Partners

The statement "There is no implant without bone" has its impact on implant companies. They are required to offer a "solution" and not simply an implant. Therefore, most implant companies do market a bone graft solution in their portfolio. Our plan is to sign a distribution agreement with one or more strategic companies. 

CoreBone, after having initial market traction, is negotiating distribution agreements with two mid-size implant companies.

Dental Market by Country

 

Orthopedic Market 

The lucrative orthopedic market is controlled by medical device global leaders such as Stryker, J&J and Medtronic, among others. CoreBone has started discussions with such players and received distribution requests from Europe and India. However, a clinical study, preferably accompanied with initial market traction is essential in this sector. CoreBone has started to plan such a study to be conducted in Tel Aviv’s Sourasky Medical Center. The study will yield initial results approximately six months from initiation. 

Exit Strategy

Today, most medical device and implant companies distribute bone grafts in their portfolio based on the market need for complete solution vs. product only.

The implant and bone graft markets are characterized by substantial activity of M&As. However, in order to become an attractive acquisition candidate, it is important to present market traction, growth clinical evidence and regulatory approvals,

CoreBone has demonstrated that it can develop innovative, differentiated and effective products and solutions that answer the market need. It also has regulatory approvals.

Proceeds from the current funding are planned to strengthen the company position, generate sales and growth, obtain convincing clinical data and submit products to FDA for entry into the US market.

Reaching these targets will position CoreBone as an attractive M&A target. After raising additional capital and reaching substantial sales. CoreBone aims to be a candidate date for IPO.  

In the dental market alone, there have been about 50 M&A transactions in recent years, including a large number of manufacturers of bone alternatives, as detailed in the table. These are acquisitions made by giant companies, which invested hundreds of millions of dollars in acquisitions in the field.

Israel is considered a world leader in the dental field, and exits by Israeli dental companies in the field of implants in recent years include MIS, which was acquired for $380 million by DENSTPLY and ALPHABIO, which was acquired for $90 million by NOBEL BIOCARE.

We estimate that as of 2020, CoreBone will become a prime target for acquisition by a leading medical, dental or orthopedic equipment company. The projected sales volume in 2021 is expected to reach many millions of dollars.

Use of Proceeds

CoreBone is raising up to $500,000. This amount is in addition to $300,000 the company raised earlier this year (from the company shareholders and led by The Trendlines Group), at the same terms as the current crowdfunding round.

The current company cost structure is mainly based on fixed costs relating to coral farm operation (coral production) and quality assurance. 

The funding will enable the company to increase its production capacity and finance its marketing efforts, including participating in trade shows, recruiting new distributors and recruiting KOLs to generate and publish clinical cases and data. 

These activities will enable the company to increase its sales, get market traction and recognition and hold its first clinical study in the orthopedic field. 

We believe that by achieving these targets the company will become an attractive M&A target for medical device market leaders.

Team

Ohad Schwartz
CEO and Marketing Manager, Co-Founder
Biography
Ohad initiated CoreBone in 2011, together with Prof. Itzhak Binderman, and has run the company since its founding. He has extensive experience as an entrepreneur, CEO and in marketing positions. Previously, he was the CEO of Vaica Medical (medication management), CEO and co-founder of Aspect AI (MRI technologies), VP at TAMI 4 (drinking water solutions) and at Teknion (office furniture systems). Ohad received his MBA in marketing and finance and is BA in economics from Tel Aviv University.

  • Founder
Prof. Itzhak Binderman
DMD, Former CTO, Co-Founder
Biography
Internationally recognized researcher in bone biology and dentistry. Previously, he served as the head of the Dental Dept. and Hard Tissue Laboratory at Sourasky Medical Center in Tel Aviv and at Tel Aviv University’s School of Dental Medicine and Dept. of Bioengineering. He was a senior researcher at the Hospital for Special Surgery in New York and a medical advisor to Interpore ProOsteon, the first coral-based bone graft (later sold to Biomet for $270 million). He has authored or co-authored more than 100 publications in dentistry and bone regeneration.

  • Founder
Assaf Shaham
Coral Expert and Coral Farm Manager
Biography
A genuine expert with vast experience in raising coral, Assaf established a coral farm at Ein Yahav, in Israel’s Arava Desert, as an alternative to traditional the agriculture farms that export produce to Europe but now face fierce competition from countries with where labour costs are considerably less costly. Assaf joined CoreBone in its early days to manage the activities related to coral growing and development. Previously, Assaf built complex lighting projects, Yad Vashem Holocaust Museum among them.

Investors 34

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OSEMBERG  DANIEL
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zagron  yosef
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ROZENSHTEIN  DENNIS
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Updates 2

  • Update Date: 10/January/2018

    We are pleased to announce that we received a grant from the Ministry of Trade and Industry to support marketing to Germany and Spain worth 150,000 NIS

    We are happy to announce that on Thursday, an article will be published on Ynet, details later

  • Update Date: 02/January/2018

    We are pleased to announce that we have returned from a very successful RoadShow in China.

    Within this framework, we reached the last stage of a meaningful negotiation with two leading Chinese medical companies.

    These companies are about to distribute CoreBone products in China - the largest market in the world and are expected to invest in the company as well.

    The investment in question will be based on a company value that is 50% higher than the company's present value.

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