A Medical Device Daily
Disc Dynamics (Eden Prairie, Minnesota) reported that it has raised $27 million in new financing.
Disc Dynamics is the developer of the Dascor disc arthoplasty system, a catheter-based, minimally invasive nucleus replacement technology designed to treat lower back pain associated with degenerative disc disease.
The company said the financing will be used to support the completion of its U.S. clinical trial of the Dascor system as well as additional product development efforts.
The funding was led by a financial investor, with additional participation from current investors Split Rock Partners, Pequot Capital, Brightstone Capital and Affinity Capital Management.
PneumRx (Mountain View, California) a company developing products for the improvement of the diagnosis and treatment of lung cancer and chronic obstructive pulmonary disease (COPD), reported closing a private placement of its Series B preferred stock, also amounting to $27 million.
Adams Street Partners and Telegraph Hill Partners led the round, which also included Sage Venture Partners and Affiliates. They were joined by all of the existing investors, including Alta Partners, KBL Healthcare Ventures, and Spray Venture Partners.
PneumRx said it will use the Series B funds to complete clinical trials and prepare for commercialization of two medical devices. PneumRx’s PneuSeal product, an adhesive sealant, currently undergoing clinical trials in Germany to assess its safety and effectiveness for reducing pneumothorax complications in lung biopsy.
On the COPD front, PneumRx has developed a minimally invasive lung volume reduction device that it says has demonstrated improvements in lung function and is expected to address a broader spectrum of emphysema patients. It said that the device has shown the ability to restore recoil in compromised lung.
PneumRx said it plans to begin clinical trials on the lung volume reduction device later this year.
In other financing news, MPM Capital (Boston/San Francisco), an investment management firm focused on healthcare investing, reported the closing of MPM BioVentures IV with $550 million of capital. The closing of MPM BioVentures IV brings funds under its management to more than $2.5 billion.
Similar to MPM’s other funds, the investors in MPM BioVentures IV include a mix of financial and strategic limited partners (LPs). Returning LPs, including GE Healthcare Financial Services, Itochu, the Kauffman Foundation and Scottish Widows Investment Partnership, comprise over half of the committed capital. New investors include AlpInvest, Dow Employees’ Pension Plan, Skandia and Union Carbide Employees’ Pension Plan. Atlantic-Pacific Capital served as the placement agent for MPM Capital in the marketing of the fund.
MPM Capital indicated that the new fund made its first investment in 2Q06, and since then its team has actively been building the portfolio which now consists of seven companies.
MPM said that the investments from MPM BioVentures IV will be spread among medical technology and biotechnology products, across the life-cycle of entrepreneurial companies, with 85% focused on biotech and specialty pharmaceuticals and 15% on medtech, tools and diagnostics. The fund’s charter also allows participation in private equity offerings of publicly traded companies. The fund’s preferred investment size will be in the range of $20 million-$50 million per company.
The fund expects to invest roughly 80% of its assets in the U.S., 20% in Europe and Asia.