A Medical Device Daily

Tengion (Winston Salem, North Carolina) reported that it was seeking to raise nearly $40.25 million through an initial public offering.

Tengion's lead product candidate is known as the "Neo-Urinary Conduit," which is intended for patients who have had their bladders removed due to cancer. The Neo-Urinary Conduit "regenerates native-like bladder tissue" from the patient's smooth muscle cells, which should reduce complications compared to using repurposed bowel tissue, Tengion says.

In 2009, the company put what was once its lead product candidate, known as the "Neo-Bladder Augment" on the back-burner even though it had advanced through Phase 2 clinical trials. That decision was made after the FDA temporarily held up clinical development to address complications in three patients. The company also determined that the Neo-Urinary Conduit would be simpler and faster to produce, and would address a larger market.

The conduit is only just now set to start is Phase 1 clinical trial, though, so last March the company halted the preparations it was making to its Pennsylvania manufacturing facility and laid off some of its workers there. The documents do not indicate any impact of the restructuring on the Winston-Salem facility.

Pulmonx (Redwood City, California) an emerging leader in interventional pulmonology reported that it has concluded an agreement for a new round of equity financing from an investment syndicate led by two new investors. The company also said that it plans to use this capital to support the international commercial launch of its Zephyr Endobronchial Valve (EBV), and its recently approved Chartis Pulmonary Assessment System.

Both products are CE marked and cleared for sale in Europe and other major international markets. The company expects that this round of financing will fund the expansion of its commercial operations through to positive cash flow and profitability.

This financing agreement includes a total of over $32 million in equity capital and was co-led by two new investors: the European venture capital firm HealthCap (Stockholm, Sweden), and Kleiner Perkins Caufield & Byers, (Menlo Park, California).

In conjunction with this new round of funding, Pulmonx is making a substantial investment in the European market, where interest in this new therapy is growing rapidly. In December 2009, Pulmonx launched the Chartis system in Europe, through a network of distribution partners in key countries, and now plans to invest significantly to grow direct and indirect sales, marketing, and clinical development activities throughout the EU. The company believes that building market leadership in Europe will position it to successfully commercialize its products in other key international markets.

In other financing news:

• ProCure Treatment Centers (Somerset, New Jersey), Princeton Radiation Oncology (Princeton, New Jersey) and CentraState Health System (Freehold, New Jersey) reported that they have closed financing and funded capital for the proton therapy center they are building in Somerset. An April groundbreaking ceremony is planned for the Center and they anticipate treating patients in 2012. It will be the first four-room proton therapy center in New Jersey and the metro-New York City area.

Currently available at only a handful of centers in the U.S., proton therapy is an alternative to X-ray radiation for treating cancer. The therapy spares healthy tissue and results in far fewer short- and long-term side effects.

The proton center will be constructed at 101 – 103 Cedar Grove Lane in Somerset (Franklin Township), New Jersey.

• Derma Sciences (Princeton, New Jersey) a specialty medical device/pharmaceutical company focused on advanced wound care, reported that the underwriter of its recent public offering has exercised its over-allotment option, resulting in the issuance of an additional 145,800 shares and warrants to purchase 48,600 shares.

Derma Sciences closed its reported follow-on equity offering, for a total of 1,117,800 common shares and warrants to purchase 372,600 shares. Each share, together with a warrant to purchase one-third of a share, was priced at $5. The exercise price of the warrants in the offering is $5.50. The company realized net proceeds of $4.7 million from this offering (Medical Device Daily, Feb. 18, 2010).

Proceeds of the offering will be used towards paying Comvita New Zealand for the perpetual worldwide licensing rights to Medihoney, Derma Sciences' Advanced Wound Care product. The proceeds will also be used to retire term debt, pay off the outstanding debt balance of a recent wound care business acquisition, and to support our growth initiatives.