A Diagnostics & Imaging Week

Techniscan Medical Systems (TMS; Salt Lake City), a developer of ultrasound technology for breast imaging, reported closing a Series E funding round of $13 million.

Lead investor is the Esaote Group (Genova, Italy), a producer of ultrasound and MRI technologies, with Esaote joined by return backers from TechniScan’s board and several angel investors.

“With the partnership with Esaote, we now have all the pieces we need to complete our technology testing and begin the next set of clinical trials that will take us all the way to the finish line,” said David Robinson, CEO of TMS.

Pending final FDA approval, Robinson said he expects commercial sales of the UltraSound CT Imaging System to start at the end of 2008.

TMS said it will begin its next set of clinical trials at the University Of California San Diego and at the Mayo Clinic (Rochester, Minnesota) in May.

“By combining this sizable financing round with our current backlog of NIH-NCI grants,” Robinson said, “we are now in the lucky position of being able to conduct clinical trials more quickly and at more locations than we had previously planned. The company is hopeful that we can secure additional clinical investigation sites by late in 2008 here in Salt Lake City and at other luminary hospitals throughout the U.S. and Europe.”

With the financing, TMS and Esaote entered into an original equipment manufacturing (OEM) agreement enabling TMS to integrate Esaote’s products and technologies in products developed by TMS, and TMS technology to be used in future Esaote ultrasound systems. The companies have also executed an exclusive distribution agreement for the European market and are looking to develop further agreements for additional commercial cooperation in the American market.

TMS says that since July of 2001 it has raised nearly $30 million in equity financing, $4 million in federal grants from the National Institutes of Health and the National Cancer Institute.

Cyberonics (Houston) reported that it plans to initiate a share repurchase program of up to 1 million shares of its outstanding common stock.

The number of shares actually repurchased and the timing of any repurchases will depend on market conditions, and may be suspended or discontinued at any time. The new repurchase program supersedes the repurchase program disclosed by the company in May 2006.

In other financing news:

• BioIQ (Santa Barbara, California), a healthcare information technology company specializing in wellness and diagnostics, reported completing a $2.5 million Series B financing round.

The round was led by Great Pacific Capital, who’s Managing Partner Dave Gross will take a seat on the BioIQ board.

“Securing growth capital allows us to extend our product line and expand our reach into corporate, institutional, and direct-to-consumer markets,” said Justin Bellante, CEO at BioIQ.

BioIQ’s home test kits and corporate solutions are designed to help people detect diseases such as cancer, diabetes and heart disease in the early stages.

• Adnavance Technologies (Vancouver, British Columbia) a developer of new direct detection molecular diagnostic tests for medical applications, reported that it completed a Series B financing totaling C$3.7 million ($3.78 million).

The proceeds will fund continued development and expansion of the company’s metalized-DNA (M-DNA) technology. The company also reported that V. Randy White, PhD, joined the company as the new CEO.

The financing was led by Working Opportunity Fund, managed by GrowthWorks Capital, JovInvestment Management, and Business Development Bank of Canada.

“We expect that our patented direct detection molecular diagnostic technology will serve to decentralize the worldwide molecular testing market by enabling hospitals and smaller independent laboratories to conduct their own testing, reducing healthcare costs and enabling patients to be evaluated and treated at their point of care,” said White. “Our technology is sensitive enough to directly detect DNA targets in human samples using a small, fully automated desktop device.”

Adnavance said it believes that M-DNA direct detection technology may eliminate the need for target amplification for a large number of molecular diagnostic tests.

The company is initially developing an M-DNA molecular diagnostic kit targeting MRSA (methicillin-resistant Staph aureus), which it expects to launch as early as 2010.

• NanoImaging Services (San Diego), a provider of high-resolution, 3-D transmission electron microscope (TEM) imaging services to manufacturers of large molecule biopharmaceuticals, reported that it has completed a round of financing led by Merck Capital Ventures. The $1.5 million investment will be used to expand the company’s service laboratory.

NanoImaging Services, currently located in northern San Diego, also said it will relocate to a larger facility in nearby La Jolla next month.

The company offers a range of services including simple visual inspection; statistical characterization; antibody/labeling experiments; and nanometer-scale, 3-D reconstruction to the pharmaceutical, biotechnology and nanotechnology industries.

• SensiGen (Ann Arbor, Michigan), a company developing gene-based molecular diagnostics, reported that the Michigan Economic Development Corp. (MEDC; Lansing), a state initiative to promote business formation, expansion, and retention, has approved an additional investment in SensiGen to be used for expanding its Ann Arbor operations.

The term loan at 1% interest will be used for hiring workers displaced by the closure of the Michigan-based research facilities of Pfizer (New York) as part of SensiGen’s expansion of operations in the state.

Upon its founding in 2004, the company said it received an investment of $2.6 million from the MEDC, and has raised $1.4 million in other investments.

• RadNet (Los Angeles) said that GE Healthcare Financial Services has arranged for RadNet an increase to its existing credit facilities, including $35 million which has drawn down at close and the ability to further increase the facilities by an incremental $65 million. The additions to the company’s existing credit facilities are intended to provide capital for near-term opportunities and further expansion, RadNet said.

“We are very pleased to have completed this financing transaction in one of the most challenging credit markets in recent history,” said Howard Berger, MD, RadNet’s CEO. “I believe that the completion of this financing evidences confidence by our credit investors in our future ability to continue to grow our business in a disciplined and effective manner.”

“While we retain floating-rate interest exposure and future rate movements are unknown, the steady drop in interest rates over the last year in the financial markets has benefited us in that it has permitted our overall blended interest cost upon the closing of this financing to remain similar to the rates initially paid by us in November 2006.” Berger said.

“The incremental facility will provide us liquidity to capitalize on near-term opportunities that lie ahead. We currently see more opportunities in our industry for consolidation and growth than ever before. The incremental facility provides us the financial flexibility and capital availability to accomplish growth and expansion consistent with our strategic goals.”

RadNet provides diagnostic imaging services through a network of 143 outpatient imaging centers. Its core markets include California, Maryland, New York and Florida.

GE Healthcare Financial Services provides capital, financial solutions, and related services for the global healthcare market. It has more than $17 billion of capital committed to the healthcare industry.