A Medical Device Daily
Helicos BioSciences (Cambridge, Massachusetts) reported that it has closed a $20 million senior secured credit facility with GE Healthcare Financial Services. Helicos said it will use the credit facility to support working capital and commercialization efforts.
Helicos received $10 million under the new credit facility on Dec. 31 and has the ability to draw down the remaining $10 million by June 30. The initial $10 million will be amortized over 36 months with interest-only payments for the first 12 months. No warrants are associated with the deal.
“We have had a relationship with GE Financial Services since 2006 and this additional loan will provide flexibility as we scale up our manufacturing and build inventory to meet customer demand in 2008 and beyond,” said Steve Lombardi, president/COO of Helicos.
Helicos is a life science company focused on genetic analysis technologies for the research, drug discovery, and diagnostic markets.
Cryotherapy developer Arbel Medical (Yokneam, Israel) said it has obtained FDA marketing approval for its product and has also raised $2.75 million from Ofer Hi Tech and Gemini Israel Funds in addition to a smaller sum from existing shareholder TRD Instrum.
The company said it hopes to eventually raise a total of $6 million.
The company has developed the IceSense probe, a minimally invasive cryotherapy technique using liquid nitrogen for the removal of benign tumors. FDA gave general approval to IceSense for surgical procedures, including for both benign and malignant tumors, and Arbel Medical will seek specific approval to use IceSense for certain procedures, such as the removal of benign and malignant tumors in the breast and uterus.
The company will conduct clinical trials this year in order to obtain more approvals. The company said it also plans to strengthen its marketing network ahead of a planned launch of the product in 2009.
Arbel is a portfolio company of Ofer Hi Tech’s incubator Naiot Venture Accelerator. TRD invested $700,000 in the company a few days ago when it met predefined milestones, and invested an additional $150,000 as part of the current financing round. TRD’s stake in the company will be more than halved from 47% to 21%.
In other financing news:
Cardiovascular Sciences (CS; Orlando) reported securing a capital investment from Seven Palm Investments of Illinois, the amount of that investment not disclosed.
The company said the funding is enough to support continued development of the company’s primary technology for prevention of adhesions following surgery.
Adhesions occur any time two adjacent tissues have been injured as part of the normal healing process. For cuts on the surface of the skin, this is a good thing. But when it is between two internal organs or tissue surfaces that are not usually fused, the company said it can cause clinically significant and serious problems.
CS has partnered with the Department of Chemistry at the University of Central Florida (Orlando) to develop the technology. It said that the first arm of development has produced several formulations of material with promising anti-adhesive properties. Early results indicate the material overcomes some of the problems that exist with current products on the market. A six figure matching grant from the Florida High Tech Corridor Council last year enabled the company to start degradation studies ahead of schedule.
“The investment from Seven Palms will allow us to rapidly accelerate the pace of development of this promising technology and enter the marketplace within the next two years,” said company CEO Larry Hooper. “We have entered a new stage in our corporate growth.”
Laboratory Corporation of America Holdings (LabCorp; Burlington, North Carolina) reported that its zero coupon subordinated liquid yield option notes due 2021 (LYONs) and zero coupon convertible subordinated notes, due 2021 (zero coupon notes), may be converted.
The LYONs are convertible into common stock of LabCorp at the conversion rate of 13.4108 per $1,000 principal amount at maturity of the LYONs. The zero coupon notes are convertible into cash and common stock of LabCorp, if any, subject to the terms of the zero coupon notes and the indenture, dated as of Oct. 24, 2006 between LabCorp, the trustee and the conversion agent.
In order to exercise these options to convert all or a portion of the LYONs or zero coupon notes, holders must validly surrender them at any time during the calendar quarter through the close of business at 5 p.m., EDT, March 31.
This is the sixth consecutive quarter during which the LYONS and the zero coupon notes have been convertible. To date, an insignificant number of LYONS and zero coupon notes have been converted. There is $590,000 aggregate principal amount of LYONs outstanding at Dec. 31, which upon conversion LabCorp would be required to settle in shares as described above.
Should zero coupon notes be converted, LabCorp would be required to pay holders in cash for the accreted principal amount of the securities to be converted, with the remaining amount, if any, to be satisfied with shares of common stock.
LabCorp develops diagnostic technologies and offers clinical assays ranging from routine blood analyses to HIV and genomic testing.