Formus

The hip side of being a New Zealand startup

If it wasn’t for a brazen lunchtime theft of a 3D body scanner, Ju Zhang is unlikely to have co-founded a company that is revolutionising the work of orthopaedic surgeons.

The initial focus of Zhang’s PhD at the University of Auckland was on analysing the shapes of human bodies, but the scanner theft forced a rethink and he began to analyse the shapes of bones.

Zhang is an engineer at heart and what he likes most of all is solving problems – and that’s essentially what Formus Labs is all about.

“We spun out of the University of Auckland’s Bioengineering Institute in 2017 with what some people would call a science experiment, but it was something we could demonstrate to potential customers.”

Formus Labs builds software that uses computational biomechanics and artificial intelligence (AI) to help orthopaedic surgeons deliver better outcomes for patients needing joint replacements. The software does the pre-operative planning for surgeons who often don’t have time to do it, analysing X-rays and CT scans to help select the right components for surgery and the position in which they should be placed.

The process has been automated, which enables Formus Labs to generate a bespoke plan in about 40 minutes. So far Formus Labs has completed almost 2,000 surgical plans for patients in Australia and New Zealand. However, in May the company received FDA clearance for its software in the United States where the company is poised to offer the first AI automated assisted planning software for hip replacement surgery.

The breakthrough came after a rigorous two-year process and marked new territory for the FDA in the field of AI automated image analysis. While the product was being scrutinised, Formus Labs was working hard in the United States talking to key surgeons at many large hospitals about what it could offer.

“We’ve got some pretty heavy hitters lined up to use the software at some of the biggest orthopaedic hospitals in the US. Beyond them is a very large segment of surgeons who don’t do pre-operative planning or do it in a very rudimentary way because they don’t have the time or tools to do it. That’s the key segment we’re going after because it will make their jobs of delivering better patient outcomes a lot easier.”

With FDA clearance now behind it, Formus Labs is looking at a Series A capital raising round next year and Zhang also has plans to go beyond implants and bones to look at what may be able to be done with the muscles, ligaments and tendons surrounding joints.

Callaghan Innovation is likely to play a role in that work, as it has since the very early days of the company.

“Callaghan Innovation has been with us since the start, with research and development [R&D] grants and intern experience grants, and it’s funded PhD students for us as well. Some of those earliest grants helped us fund R&D into AI and other components that led to us being able to automate the whole process.”

Zhang is a strong advocate for the Auckland Bioengineering Institute, which he says is one of the largest of its type in the world and producing exceptionally talented graduates who have joined Formus Labs via Callaghan Innovation grants.

There is another key advantage Zhang sees to being based in Aotearoa New Zealand: here, there are fewer regulatory hurdles for developing medical devices, which provides the opportunity for faster innovation.

“We can do a prototype and get it tested in a clinic, which makes it a faster innovation iteration loop. There’s a really good innovation ecosystem here. We may be small but there’s a concentration of talent, and a lot of resources around, like Callaghan Innovation, to help.”

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