A Medical Device Daily

Ekos (Bothell, Washington) has closed a $12.5 million round of Series D funding to expand marketing of a device designed to clear dangerous clots that form in peripheral blood vessels. The round, which closed Dec. 29, brings Ekos' total venture financing to just over $100 million, Ekos CEO Robert Hubert said. The company also plans to complete a Series D extension to top off the round with an additional $2 million to $2.5 million, he added.

New investor Crown Venture Fund of Chicago led the round, joined by 90% of the company's previous investors, including Ascension Health Ventures, CID Capital, EGS Healthcare Capital Partners, MedVenture Associates, Mitsui & Co. Venture Partners, NGN Capital and Protostar Equity Partners.

Hubert said Ekos expects to reach cash-flow break-even in 3Q10.

Ekos sells devices designed to break up clots in veins and arteries. One application is deep-vein thrombosis (DVT) in which a clot blocks blood flow in a deep vein, usually in the pelvis, calf or thigh, though veins in other areas may also be affected. Untreated, DVT can lead to pulmonary embolism, in which a piece of a clot breaks free and travels to the lungs. Together, DVT and pulmonary embolism contribute to at least 100,000 deaths each year, according to a Surgeon General statement issued in September.

Ekos introduced its first clot-busting system in 2006, but recently it has launched a second-generation device, EkoSonic Endovascular System with Rapid Pulse, which is designed to clear clots away more rapidly.

The company's catheter-based system uses ultrasound to thin out the fibrous strands of the clot and separate them. Then, a thrombolytic drug is administered. Loosening the fibrin strands increases the availability of plasminogen-activation receptor sites and thus makes the drug more effective. Also, the ultrasound pulses push the drug into the clot and hold it there, so that blood flow doesn't immediately wash it away.

While the first-generation device administered uniform ultrasound pulses, the new system issues pulses of random heights and widths. This is better, Ekos says, because individual fibrin stands have their own length and mass. While the initial system cleared clots twice as quickly as would be possible with catheter-directed drug treatment, the new system busts them up four times as quickly, Hubert said.

In addition to venous applications, doctors also use Ekos' system to treat peripheral-arterial occlusions, or clots in peripheral arteries. The system is also cleared for use in the pulmonary artery, though it is not approved for pulmonary embolism because not enough evidence has accumulated to prove its effectiveness for this specific indication, the company noted.

Ekos has not disclosed its sales, but Hubert said the company increased top-line revenue by nearly 60% in 2008, and that it expects to grow the top line by about 50% this year.

In other financing activity:

• CardioDynamics (San Diego) reported that the company's note holders had not exercised their "put" rights regarding the $5.25 million, 8% subordinated convertible debt securities. The terms of the notes provided an option under which holders had an opportunity to elect, in January 2009, to be repaid in April. Since the put option expired unexercised, the maturity date for the debt remains April 11, 2011. The convertible notes carry an 8% interest rate, payable in cash semi-annually with a conversion price of $8.05 a share, the company said.

CardioDynamics develops BioZ ICG products and medical device electrodes.

• Biotechnology Value Fund (BVF), said it intends to make a cash tender offer to buy any and all of the outstanding common stock of Avigen (Alameda, California) that BVF does not own at a price of $1 a share.

BVF noted that the offer price represents a 35% premium over Avigen's closing stock price of 74 cents on Jan. 8, the day prior to BVF's announcement that it was seeking to remove all incumbent Avigen directors and to elect its own slate of stockholder-focused nominees.

BVF Partners, the general partner of BVF, owns an aggregate of 8,819,600 shares of Avigen, or roughly 29.63% of the outstanding shares.