A Medical Device Daily

Progentix Orthobiology (Bilthoven, the Netherlands) said it has closed an investment agreement with NuVasive (San Diego), a device company focused on developing products for minimally disruptive surgical treatments for the spine. NuVasive will gain access to Progentix' synthetic bone substitutes designed to accelerate bone healing through a novel micro-structure, the company said.

NuVasive's initial commitment will be $15 million in cash, consisting of a $10 million equity purchase from Progentix shareholders and a $5 million loan used to fund ongoing clinical and regulatory efforts.

Upon accomplishment of the complete set of pre-defined development milestones, NuVasive will be obligated to purchase the remaining equity of Progentix for $45 million, and, upon the achievement of additional milestones and NuVasive's sales success, pay a maximum earn-out of $25 million.

In addition, NuVasive obtained exclusive worldwide distribution rights as well as an exclusive option to purchase all of Progentix under certain circumstances, the company noted.

"We are extremely pleased to be working with NuVasive, a company that has built an impressive track record of growth in the spine market by consistently and successfully leveraging innovation," said Progentix CEO Joost de Bruijn, PhD. "NuVasive's investment allows Progentix to continue developing its unique family of bone graft materials and allows the near term commercialization of these products."

The Progentix product portfolio currently consists of a family of calcium phosphate synthetic bone substitutes. The Progentix granules have demonstrated osteoinductive-like properties in preclinical models and require FDA clearance via a 510(k) pathway, the company said. A putty formulation of the product is currently under development. Progentix is a spin-out from Twente University (Enshede, the Netherlands) and has close ties to Queen Mary University (London), where de Bruijn is a professor of biomaterials and focuses on the research of Progentix' suite of biomaterials.

Progentix, founded in 2007, obtained a Series A financing from BioGeneration Ventures in early 2008, allowing the accelerated development of its technology.

In other financing activity:

• Urovalve (Newark, New Jersey), a device company focused on creating products for urinary flow and control, said it has received funding from the New Jersey Economic Development Agency (NJEDA) to advance development of its Surinate Bladder Management System. The device is designed to improve the quality of life of men who suffer from acute or chronic urinary retention, an inability to empty the bladder.

Terms of the funding were not disclosed. To date, Urovalve said it has now raised $3.8 million from private investors and other sources, including the New Jersey Commission of Science and Technology and the National Institutes of Health.

"Surinate is a state-of-the-art alternative to the repeated insertion and removal of conventional urinary catheter devices, some of which must be put in and taken out of a patient four to six times a day," said Harvey Homan, PhD, president/CEO of Urovalve. "The Surinate system provides for one single insertion over a 28-day cycle, and requires no tubes or other materials outside the body, such as a urine-collection bag, while enabling the individual to void urine from his bladder simply by using a magnetized valve control."

Homan added that the Surinate system also provides "lifestyle normalcy" and that the ability to avoid infection, "especially of the hospital-related type, could offer huge savings for the healthcare system."

A pilot study of the Surinate system is under way at four medical institutions: VA Boston Healthcare System; VA New Jersey Healthcare System (East Orange); Vanderbilt University Medical Center (Nashville, Tennessee) Department of Urologic Surgery; and, the Virginia Urology Center (Richmond). The pilot study is expected to conclude in the first quarter of 2009. The company intends to begin a pivotal clinical study in the first half of the year.

• 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.