A primer for understanding Clearpoint Neuro

This company can be understood as a platform partner company that operates in a few different segments. They are listed as follows

1. Biospy
2. Drug delivery
3. LITT/imILT (Laser interstitial thermal therapy/Immunostimulating Interstitial Laser Thermotherapy)
4. DBS (Deep brain stimulation, neuromodulation more broadly)
5. BCI'S (Brain computer interfaces)

For a lay person, this already presents too much information to sift through and I don't feel like writing a 35,000 word reddit post trying to explain everything that I'm aware of. If you want to know more about the following, there are other resources you can find online.

But I will bring up some reasons annd examples as to why companies are partnering with clearpoint in the first place. The hope being that it can serve as a head start in your understanding of the company.

First let's start with biospies. This is probably the easiest segment to understand. When a lesion is found, a biopsy will be taken by a surgeon. Pathologists are given that tissue where they run some tests and then they pass the results to someone who communicates the results to the patient. Biospies help diagnose cancer. I think this is probably something most people who are reading this are aware of.

Traditionally when a surgeon takes a biospy of a patients brain they are either doing an open biospy or a needle biospy. Regardless of the method, the patients head is placed in a stereotactic frame and the surgeon will normally be guided to the lesion with preoperative imaging. Preoperative being the critical word and the differentiating factor for clearpoint. With the clearpoint system, the surgeon is working under live MRI guidance. While it's an exaggeration to say that surgeons that aren't using live MRI guidance are flying blind, they cannot operate with the same precision (for example, moving a patient from a preoperative scanner causes the brain to shift slightly) and they cannot see exactly what is happening at the target site like a person can with a live feed. I stress this because a Dr. Clark Chen (who covered use of the clearpoint system for biospy on their youtube channel) has stated that having live guidance when taking a biopsy gives him the confidence he needs to take samples from multiple parts of a lesion. Patient safety being the concern brought up in the video by Dr Clark. It's speculation on my end as I'm not a pathologist and I do not have this data, but a greater number of samples (if they can be done safely) should result in fewer false positives & false negatives. When dealing with cancer that is something that is understandably quite important.

The second segment I'll talk about is drug delivery. This is probably considered by many as the most important segment of clearpoint for future prospects as a company. Whether that is the case or not, let me explain why companies are coming to clearpoint in the first place.

The history of drug delivery to the brain can only be described as abysmal.

Drug delivery no matter the organ is not an easy feat and the route you take matters. If I had to guess (as I have never been responsible for helping make a drug), I would say that before the target to hit stage is even done the delivery route is already being kept in mind or established. If not by then, certainly before the drug has made its way into preclinical stages.

Reading about DIPG (an aggressive and fatal form of childhood caner), I've found authors stating that hundreds of promising drugs for DIPG have made their way to clinical trials only to eventually become withdrawn from testing due to toxic side effects that appear in dose escalation. Because systemic delivery offers no real way to accurately target a specific structure of the brain (which is a tissue that is very resistant to diffusion), the concentration must typically be raised to approach clinically meaningful results. Hence issues of toxicity. These are indications where capital goes to die.

This leads me to why clearpoint is catching a sort of fever pitch with biologics companies right now. Convection enhanced delivery (CED) is a nifty solution for the problem I listed above.

When you pair CED with live MRI guidance, you capture the specificity in targeting that these drugs require & you can substantially lower the quantity of the therapeutic you're administering to the patient, thereby reducing the probability toxic side effects occur.

This reduces the risk companies face when trying to bring a drug to market and is a significant value add that clearpoint provides to its customers.

The third segment Clearpoint operating in is laser ablation. Their most significant partnership in this segment is with Clinical Laser Thermia, a Swedish medical device company. Although I'm under the impression they are working with others for laser ablative surgeries, their revenue take with other systems is lower. There's not much to say here that's not explained or understandable if you understand why clearpoint is important for drug delivery. Guidance to the site to be ablated is important part of the feedback a surgeon needs for these procedures, so it fits nicely into the clearpoint suite. One thing of note is that it appears for the treatment of cancer, a two phased approach of laser ablation/drug delivery of immunotherapy via CED can be utilized.

The fourth segment is DBS or more generally, neuromodulation. This is an important segment for clearpoint as they have a significant value add that will be important for patient acquisition for a product that's heavily underutilized (only 2% of parkinsons patients have ever undergone DBS and the patient burden replaces itself roughly every 20 years). What MRI guided DBS lead placement allows for is the patient to be under general anesthesia and to remain on medication prior to surgery. I'm not completely certain of this, but I believe this is because an MRI provides an effective biomarker for DBS, whereas conventionally your biomarker was the patient awake on the operating table and no longer shaking.

DBS is by no means a new procedure (especially for parkinsons) as it has been around for longer than I've been alive, but changing the market from a primarily awake regime to asleep DBS should go a long way in patient recruitment. Also one thing to note is the number of indications neuromodulation is applicable for is significant. Neuromodulation for use in essential tremor, alzheimers disease, stroke rehabilitation, epilepsy, chronic pain, depression, OCD, obesity, & tourettes are all either being investigated or are already approved for use in humans.

Lastly we have brain computer interfaces. This is through clearpoint's partnership with blackrock neurotech (formerly blackrock microsystems). From the name alone this may sound like something that's far off into the future, but it's actually one of the products that is furtherest along. Blackrock has had their implants in humans for over a decade (Matt Nagle had his implanted in 2004). The reason (again similar to drugs) is precision of delivery. The Utah array that is implanted into the cortex is not a large device. It measures 4.4 by 4.2 mm's. That's significantly smaller than a US penny.

And for the device to work properly, it needs to be implanted on a specific part of a persons cortex. Precision is the name of the game. There has been an agreement made between clearpoint and Blackrock to automate these implants, but at this time this is more or less all we know.

Anyways if you're new to investigating the company I hope that helps you understand what you're dealing with. Disclosure: I am long common stock and options of clearpoint neuro (ticker $CLPT).