A Medical Device Daily
Predictive medicine company PreMD (Toronto) reported that it has entered into an agreement with Midsummer Investment for a private placement of about 2.9 million units at a price of C$1.33 per unit ($1.14), each unit consisting of one common share and one-half of one common share purchase warrant, for gross proceeds of up to C$3.89 million. Each whole warrant shall be exercisable at a price of C$1.66 per share for a period of three years from the closing date.
The proceeds are to be used for general corporate purposes.
Several additional existing institutional investors have also agreed to participate.
Closing of the placement is subject to certain conditions including approval from the American Stock Exchange. PreMD expects closing to occur on or about March 30.
PreMD's cardiovascular products are branded as PREVU(x) Skin Sterol Test.
Dr. Brent Norton, president/CEO of PreMD, said, "Following our reacquiring the rights to the PREVU technology, we have been actively evaluating multiple sales and distribution options including having discussions with potential partners. In addition, we are poised to better capture the potential of the PREVU product line, including the use of PREVU(x)LT for the insurance industry, as well as the possibility for an expanded claim for PREVU(x)POC based on our PASA data, which we expected to be reported shortly."
The company's cancer tests include ColorectAlert, LungAlert and a breast cancer test.
GlucoLight (Bethlehem, Pennsylvania), a development-stage company formed in 2003 to focus on blood glucose monitoring, reported closing a $2 million first tranche of "C" round financing, with the second tranche expected to close in late 2Q07.
The financing was led by venture fund Matignon Technologies (Paris). Ben Franklin Technology Partners of Northeastern Pennsylvania, a state-funded economic development organization that links early-stage companies with funding and other resources, also participated in the round. Other individual investors included current shareholders and new investors.
GlucoLight said the funding will enable it to complete development of an optical, continuous glucose monitor (OCGM), a non-invasive monitor designed for the acute care environment. The money will help fund the clinical studies leading up to an expected pivotal trial in 2008, GlucoLight said.
Ray Krauss, CEO of GlucoLight, said, "We have been able to go from concept to working prototype, including initial clinical trials in the field of intended use, on an initial capital raise of $7 million. We expect the next round of financing to bring us through the clinical trials process."
Using optical coherence tomography (OCT), GlucoLight measures blood glucose levels through an anatomical area in the skin that shows physiological changes correlated to changes in blood glucose. The monitor displays real time glucose measurements with an initial single point calibration.
Krauss said, "We have developed and demonstrated a device that will provide physicians and healthcare workers with a product that not only provides continuous data, but will help offset labor and supply costs for hospitals. In recent trials, we have been extremely pleased with the device's accuracy."
"Based on compelling data that reinforces the importance of tight glycemic control in the acute care environment, coupled with the worldwide diabetes epidemic, we estimate the size of our near-term addressable market to be at least $500 million." He said future efforts will focus on additional product refinements to our device for the acute care environment and for eventual FDA evaluation. Eventually, we will miniaturize our glucose monitoring technology and develop a consumer product that will help both Type I and Type II diabetics better manage their glucose levels, and help decrease the complications associated with this world-wide illness."
In other financing activity:
• Fresenius Medical Care (Bad Homburg, Germany) reported that it will propose a share split for its ordinary and preferred shares in the ratio of 1:3 at the next general shareholder meeting May 15.
Fresenius said the split is intended to promote more trading activity in its shares and to increase the shares' attractiveness for a broader group of investors.
Fresenius shares are traded on the New York Stock Exchange (NYSE) in the form of ADSs. Currently, the ratio between the ordinary and preference ADS and the underlying ordinary and preference shares is 3:1, meaning that three Fresenius ordinary or preference ADSs are the equivalent of one Fresenius ordinary or preference share. Upon approval of the proposed share split and the registration with the commercial register, each Fresenius Medical Care ordinary or preference ADS will represent one Fresenius ordinary or preference share.
Fresenius says it is the world's largest integrated provider of products and services for individuals undergoing dialysis.
• Laboratory Corporation of America (LabCorp; Burlington, North Carolina) reported that for the period of March 12 to Sept. 11, its zero coupon subordinated liquid yield option notes (LYON), due 2021, and zero coupon convertible subordinated notes, due 2021, will accrue contingent cash interest at no less than 0.125% of the average market price of a LYON or zero coupon note, as applicable, for the five trading days ended March 7, in addition to the continued accrual of the original issue discount.
Contingent cash interest, which the company has determined to be roughly $1.22 a note, will be payable to holders of the LYONs or zero coupon notes as of Aug. 27. The payment of contingent cash interest is expected to be made Sept. 11.
• InSight Health Services (Lake Forest, California), a provider of diagnostic imaging, has launched an offer to exchange shares of its common stock for up to $194.5 million aggregate principal amount of 9-7/8% senior subordinated notes, due 2011, issued by the company's subsidiary, InSight Health Services.
For each $1,000 of aggregate principal amount of notes tendered, noteholders will receive 40 shares of common stock after giving effect to a 4.70424-for-1 reverse split.
The company is soliciting votes to accept or reject a pre-packaged plan of reorganization, which will attempt to accomplish the restructuring on the same terms as the out-of-court exchange offer.
The exchange offer and consent solicitation will expire at 11:59 p.m., EDT, April 19, unless extended.