A Medical Device Daily

Concentric Medical (Mountain View, California), a company developing the Merci Retriever to remove blood clots from the brains of ischemic stroke patients, said it has filed a registration statement with the Securities and Exchange Commission (SEC) for a proposed initial public offering (IPO) of shares of its common stock.

In its filing, the company said it planned to raise up to $69 million, and said all shares of the common stock to be sold in this offering will be sold by the company. The number of shares to be offered and the price range have not yet been determined.

The company said it planned to use $30 million of the IPO proceeds for sales and marketing initiatives to support the ongoing commercialization of its Merci Retrieval System; $10 million for research and development activities, including support of product development efforts; and $7 million for clinical and regulatory initiatives, including $5 million to support the Merci Registry.

The company said it intends to use the remainder of its net proceeds for general corporate purposes

The company said it has incurred net losses since its inception in August 1999. For the fiscal years ended Dec. 31, 2004, 2005 and 2006, and for the six months ended June 29, 2007, the company had net losses of $8.8 million, $7.4 million, $6.9 million and $3.5 million, respectively. Through June 29, 2007, the company had an accumulated deficit of $49.3 million.

In its filing, the company also noted that that Mechanical Embolus Removal in Cerebral Ischemia (MERCI) trial and Multi MERCI trial study participants experienced complications with the use of its Merci Retrieval System, including infection, perforation or dissection of the vessel wall, introducing a blood clot into a different vessel, internal bleeding and death.

In the MERCI trial, clinically significant procedural complications occurred in 5% of patients and symptomatic intracranial hemorrhage occurred in 7.8% of patients. In the Multi MERCI trial, clinically significant procedural complications occurred in 5.5% of patients and symptomatic intracranial hemorrhage occurred in 9.8% of patients. The company noted that in a small percentage of patients, other adverse events occurred, including device fracture or minor vessel damage.

“The risk of serious complications could result in potential injury and/or death to patients and subject us to product liability litigation or compel us to recall our Retrieval System from the market as a result. Patient injury and/or death and product liability litigation may damage our reputation in the marketplace and adversely impact our revenues,” the company said.

In 2004, the company received clearance to market the Merci Retriever for the removal of blood clots from the brain in patients experiencing an ischemic stroke (Medical Device Daily, Aug. 17, 2004).

That move by the FDA came a little less than six months after the agency’s Neurological Devices Panel declined to take a formal vote on the system based on what it said was an absence of randomized control data and a bothersome mortality rate.

While the panel did not take a formal vote at that time, most members agreed that the company’s clinical trial demonstrated efficacy on the revascularization endpoint and thus has potential. However, members were troubled by the 38% death rate in the firm’s single-arm, 114-patient trial.

The FDA granted clearance after a review of patient data obtained in a clinical study at 25 medical centers in the U.S. The MERCI trial ultimately evaluated the device in 141 patients who were ineligible for the “clot-busting” drug tissue plasminogen activator, or tPA, which can only be used within three hours of stroke onset.

The Merci Retriever is made of a nitinol wire with a helical-shaped tip. The helix is covered with a platinum coil for radiopacity, and the nitinol core wire is coated with a hydrophilic coating, ending proximal to the helical-shaped tip. The tip of the retriever has five loops, which are designed to capture thrombus from the neurovasculature and foreign bodies from the neurovasculature, peripheral vascular and coronary vascular systems.

For both foreign body retrieval and thrombus removal, a microcatheter is positioned beyond the obstruction and the retriever is deployed. The microcatheter and retriever are pulled back to engage the foreign body or thrombus. All are then withdrawn from the body.

Merrill Lynch, Pierce, Fenner & Smith Inc. and Lehman Brothers will be acting as joint book-running managers and Thomas Weisel Partners is acting as a co-manager of the offering.

In other financing news: Emerging Vision (Garden City, New York), a provider of eye care products and services, and one of the largest franchised optical chains in the U.S., reported has obtained a revolving credit facility providing for aggregate borrowings of up to $6 million with Manufacturers and Traders Trust Corp. (M&T).

The credit facility, which replaces the company’s previous revolving line with M&T (which was $2 million), matures in August 2009 and will accrue interest at the variable rate of LIBOR plus 2.75%.

In addition, in connection with obtaining the revolving line with M&T, the company finalized its acquisition of The Optical Group (TOG; Oshawa, Ontario) and its affiliate, one of the leading optical group purchasing organizations in Canada, for C$3.8 million (about $3.6 million) in cash. Among the other assets and liabilities included in this acquisition, the company acquired the accounts receivable of TOG, and assumed certain accounts payable of TOG, effective as of July 1.

TOG currently has about 525 active members in its optical group purchasing business.