A Medical Device Daily

Orthopedic implants maker Amedica (Salt Lake City) said that his elected not to proceed with its initial public offering (IPO) "based on market conditions."

The company said it will withdraw its registration statement on Form S-1 as filed with the Securities and Exchange Commission (SEC).

"Given current market conditions, we do not believe it is a suitable time to continue with an IPO," said company CEO Ashok Khandkar, PhD. "We are currently making progress on our initiatives to finalize the build-out of our manufacturing facility as we prepare to commercialize our lead spinal products in 2008. Our current cash position provides us with adequate funding to continue with these initiatives as we determine an appropriate time in the future to pursue additional financing."

The company reported last month that it had priced its IPO at between $13 and $15 a share, hoping to raise proceed of about $57.8 million after expenses (Medical Device Daily , July 23, 2007).

Amedica first filed for the 4.7 million share offering back in May to raise up to $74.75 million (MDD, May 24, 2007).

It focuses on using silicon nitride ceramic technologies to develop a range of high-performance spine and joint implants, particularly for the spine, hip and knee markets.

Its lead product candidates are its Valeo family of spinal implants, used to restore and maintain the alignment of vertebrae in the cervical, or neck region, and lumbar, or lower back region, of the spine.

In its SEC filing, the company said that it expects to launch these products by mid-2008, subject to FDA clearance. In 2006, it received FDA clearance for the first-ever ceramic spinal spacer for insertion between two vertebrae to help stabilize the spine. It said it also hopes to introduce additional spinal spacers by the end of 2008, including cortico-cancellous spacers that feature a bone-like structure with a solid, or cortical, load-bearing portion and a cancellous, or porous, structure that is intended to promote bone attachment for secure spinal fixation.

The company said that the Valeo family of spinal implant candidates includes an all-ceramic, motion-preserving cervical disc, for which it anticipates commencing a clinical trial by mid-2009. In addition, the company is incorporating its silicon nitride ceramic technology into the development of the Infinia family of total hip and knee implants. The company said it anticipates initiating a clinical trial for its first total hip implant product candidate in 2009.

CHAD Therapeutics (Chatsworth, California) reported the completion of a $3.5 million financing package with a private investor that it said provides funding for the development and commercial roll-out of the company's initial products for the sleep disorder market and enhances the company's working capital.

The financing package is comprised of a $750,000 convertible term note and a $2.75 million revolving credit line, all secured by the company's assets. The term note is payable in equal installments over 33 months and bears interest at prime plus 2%, and the revolving credit line bears interest at prime plus 1.5%. A portion of the financing was used to pay all outstanding obligations on the company's factoring arrangement with a commercial bank.

At the investor's option, the convertible note may be converted into shares of the company's common stock any time during the term of the note at a conversion price of $1.18. In addition, warrants to purchase up to 976,744 shares of CHAD's common stock were issued to the investor with an exercise price of $1.24 per share.

In connection with the financing, CHAD incurred brokerage and related fees of about $400,000 and issued 20,958 warrants with an exercise price of $1.24 to a brokerage firm that introduced the investor.

Earl Yager, CHAD's president/CEO, said, "As previously announced, we currently are launching several new products for the oxygen market and expect to launch our initial products for the sleep disorder market this fall. We also are pursuing outsourcing and other cost-cutting measures to reduce manufacturing costs for many of our established products. We believe this financing package gives us the resources to complete these programs while maintaining our current operations."

CHAD develops respiratory care devices designed to improve the efficiency of oxygen delivery systems for home healthcare and hospital treatment of patients suffering from pulmonary diseases.

In other financing news: Vyteris (Fair Lawn, New Jersey) reported the completion of a new private placement financing transaction in which it raised $12.7 million in cash, for net proceeds of $11.4 million after legal and transactions costs of $1.3 million. This follows another financing round last October 2006 for $23.1 million.

"This successful raise is another demonstration of continued investor confidence in our strategic plan, specifically the commercialization and rollout of our LidoSite active transdermal patch product into the U.S. physician office marketplace, where over two million blood draws are performed daily," said Timothy McIntyre, president/CEO of Vyteris.

Use of proceeds from the financing are targeted for commercial rollout, including additions to the company's management expertise for commercialization, start up of a customer support system for the Laboratory Coporation of America (Burlington, North Carolina) partnership, initiation of the Vyteris specialty sales force, increase in manufacturing and product inventory for 2008, and supporting marketing and promotion activities for LidoSite, which will be available to the physician office market beginning in 3Q07.