Bacterin a Bright Spot

BELGRADE – This bare-bones business could turn the economy around.  Biomedical company growing new bones, jobs

In a glass-walled laboratory on the edge of this tiny bedroom community, half a dozen men in spacesuits are crafting the latest in skeleton repair, a spongelike scaffold on which the human body will naturally produce new bone. With this creation, backs can be fused without metal rods, skulls mended without metal plates. Bones pitted by cancer can be made whole again.

“You want to talk about accelerated medicine? This is accelerated medicine,” said Jesus Hernandez, a very proud vice president of Belgrade-based Bacterin International.

A Gallatin Valley-grown biomedical company, Bacterin has managed to expand from a handful of employees less than 10 years ago to a publicly traded company with 120 people on payroll. Its creations, ranging from bone grafts to infection-preventing coatings, have given it a toehold in a $7 billion industry. In a rough economy, Bacterin continues to develop new products, nail down research grants and expand its laboratories.

Bacterin is what Bureau of Business and Economic Research director Patrick Barkey calls the bright spot in the region’s economy, stepping beyond the recession-strapped local market to tap into more stable industries such as health care. High-tech and manufacturing businesses make up more than 20 percent of the region’s wages, second only to Montana State University’s 29 percent.

What Bacterin has managed to do is take donated human bone tissue, demineralize it and wash it free of blood lipids while leaving its growth factors and morphogenetic proteins intact. The result is a bone sponge the body doesn’t reject and in fact uses as a trellis for making new bone in as few as 60 days. The product is known as OsteoSponge.

“We can take something that’s hard bone and make it pliable. You can cut it with a pair of scissors, you can squeeze it, suture it, you can anchor it,” Hernandez said. “We are the inventors of the OsteoSponge. This is the original product that everyone on the planet wants to mimic. What they haven’t been able to mimic is the process.”

In other words, the competition hasn’t succeeded in getting the body to naturally attach to its products and grow bone as Bacterin’s products do. The company has adapted its technology to reattaching skull cutouts after brain surgery, connecting knee tendons, repairing eye sockets and relieving back pain by stabilizing vertebrae.

Now the company is applying its technology to skin grafts. Down the hall from where workers are turning femur material into OsteoSponge, two researchers are developing a graftable skin, free of DNA and donor coloring that will be used to treat skin sores in diabetic patients and hopefully prevent amputations.

“The incidents of diabetes are very, very high, so you have patients who develop ulcers. And when these ulcers don’t heal, they cut your foot off, or you lose your leg,” Hernandez said. “So, what we’re doing is creating a product that will help heal the ulcer and save your foot.”

The skin graft should be on the market in the first quarter of next year.

This lab is Hernandez’s baby. The OsteoSponge work area is so clean that particles 200 times smaller than a human hair are constantly scrubbed, filtered and radiated from existence.

Shoes, triple-bagged in the lab, are replaced every couple of months. Surgical gloves are changed 106 times a day. There are freezers at the other end of the building where donor tissue is stored at minus 80 degrees Centigrade and every donated cell is tracked from the time it arrives to the time it is either destroyed or implanted.

Everything here is something one would expect to find in the shadow of a major research hospital or university. But this is Belgrade, a come-one, come-all community that never took a shine to zoning or planned unit developments. Bacterin is flanked by a modest apartment complex to the south, the end of an airport runway to the east and to the north a warehouse used by a traveling magician to house tigers.

It is because Belgrade threw out the welcome mat so easily that Bacterin is here, said Guy Cook, company founder, CEO and president.

“Belgrade was willing to help us out,” Cook said. The community helped the startup secure small-business funding that it wasn’t able to line up in Bozeman where it spent time in TechRanch, a nonprofit business incubator.

Bacterin was started in 1997 on research Cook performed at Montana State University. MSU houses the Center of Biofilm Engineering, a National Science Foundation Engineering Research Center.

The company’s big break came in the early part of the last decade when the U.S. Department of Defense gave it two $1 million contracts to develop a special bacteria-fighting coating for medical devices used in mobile army surgical hospitals where three-fourths of the battlefield injuries were open fractures to arms or legs.

As Cook thinks about those defense contracts today, he can’t help but think how today’s politics may have affected them. The contracts came in the form of earmarks from then-Republican Sen. Conrad Burns. They launched the company to a new development stage.

Today, Bacterin is the biggest Federal Express customer in Montana, dependent on timely incoming shipments of donated bone and outgoing delivery of its unique products. Hernandez would like to see the company become more active in the donation process. He would like to be able to offer Montanans the chance to become bone tissue donors for a Montana-based biomedical company, but that could be a ways off.

State law prohibits donations to for-profit companies. The nonprofit company that services Montana is based in Seattle. Donors can specify Bacterin as a recipient, which gives the company first rights to see if a donation passes muster. The ideal donor, said Hernandez, is about 53 years old.

The company is still a leader in the biofilm industry.

Reporter Tom Lutey can be reached at (406) 657-1288 or at tlutey@billingsgazette.com.