Diagnostics & Imaging Week
Volcano Therapeutics (Rancho Cordova, California) has filed with the SEC for an initial public offering (IPO) of stock to raise up to $86 million, all of the shares to be offered by the company. The filing did not detail the number of shares to be offered or their pricing.
Founded in 2000, Volcano manufactures a suite of intravascular ultrasound (IVUS) and functional measurement (FM) products for the diagnosis and treatment of vascular and structural heart disease. The company explains in its filing: "During an IVUS procedure, an imaging catheter is placed inside an artery to produce a cross-sectional image of the size and shape of the artery's lumen and provides information concerning the composition and density of plaque or lesions and the condition of the layers of the surrounding arterial walls. Our IVUS products consist of consoles, single-procedure disposable catheters and advanced functionality options. FM devices measure the pressure and flow characteristics of blood around plaque thereby allowing physicians to gauge the plaque's impact on blood flow and pressure. Our FM products consist of pressure and flow consoles and single-procedure disposable pressure and flow guidewires."
The company targets its marketing to hospitals performing percutaneous interventional procedures.
Volcano also is developing customized versions of its consoles "and advanced functionality options" as part of its "vfusion cath lab integration initiative." The vfusion offering will include cath lab-integrated IVUS and FM capabilities, real-time Virtual Histology with color-coded identification of plaque composition, automatic real-time drawing of lumen and plaque borders, and IVUS and angiographic image synchronization, or co-registration, in two- and three-dimensions.
The company filing says that one of its key risks is the difficulty of predicting the future growth opportunities for IVUS technology both domestically and internationally.
Volcano is sponsoring the PROSPECT study, calling it "a natural history study of plaque," with Advanced Cardiovascular Systems, a unit of Guidant (Indianapolis), and says that if it fails to demonstrate a causal connection between vulnerable plaque and coronary events, this would hurt any demand for its products.
Volcano has an important partner in GE Healthcare (Waukesha, Wisconsin), the two companies having launched, at this year's meeting of the American College of Cardiology, an effort to combine a digital cardiovascular imaging with integrated IVUS imaging capabilities.
In other financing activity:
• GE Healthcare Financial Services (Chicago) reported that it has arranged a $161 million senior secured credit facility for Primedex Health Systems (Los Angeles) and its primary subsidiary, Radnet Management, a provider of outpatient diagnostic imaging services in California. The $161 million facility consists of a $15 million, five-year revolving credit facility; an $86 million, five-year term loan B; and a $60 million, six-year second lien term loan.
Primedex said it would use the proceeds for refinancing a portion of existing debt, to provide liquidity for working capital and other general corporate needs.
Primedex, through Radnet Management and affiliated entity Beverly Radiology Medical Group, is a provider of diagnostic imaging services in California through a network of 57 fixed-site centers. The company operates 34 multi-modality facilities and 23 single-modality facilities in 11 regions in California.
• Sequenom (San Diego) reported commitments by ComVest Investment Partners II, Pequot Private Equity Fund IV and L BI Group for $30 million.
Subject to shareholder approval and other closing conditions, the company will issue to investors 54.55 million shares of common stock as well as 32.73 million common stock purchase warrants exercisable at 70 cents per share.
The transaction is expected to close by May 31, with net proceeds from the transaction to be used for general working capital needs.
Sequenom makes progenetic analysis products for noninvasive prenatal testing, biomedical research, molecular medicine and agricultural applications.
• Ekos (Bothell, Washington) reported securing $26 million in Series C financing, enabling the formation of a commercial sales and marketing team to support the company's flagship ultrasound-assisted, fluid infusion catheters.
The company is developing ultrasound-assisted, fluid infusion catheters for diagnosis and therapy. Its Lysus peripheral infusion system and micro-infusion catheter are cleared for the delivery of therapeutic agents, including clot-dissolving thrombolytics, into the peripheral vasculature of patients with peripheral arterial occlusions and deep vein thrombosis. The latter product also is cleared for the administration of contrast media into the brain.
• NuGEN Technologies (San Carlos, California), a company that develops RNA amplification and labeling systems, reported securing $7.75 million in financing.
The company said it would use the funds to accelerate its technology development and expand global distribution for its amplification and detection systems for gene expression research.
The round was led by Alloy Ventures. Existing investors Sutter Hill Ventures, Radius Ventures and The Band of Angels also participated in the financing.
• Southridge Capital Management, a registered investment adviser providing investment capital to global public issuers, reported an equity financing facility of up to $15 million between the funds it advises and Imaging Diagnostic Systems (IDSI; Plantation, Florida).
IDSI has developed an imaging device to aid in the detection and management of breast cancer. The Computed Tomography Laser Mammography (CTLM) system is designed to detect breast abnormalities in a non-invasive procedure.
Currently seeking FDA approval, IDSI has commercialized the CTLM system in certain international markets.
Southridge reports having provided $1 billion in growth capital to portfolio companies globally.
• Implant Sciences (Wakefield, Massachusetts), a manufacturer of products for national security, medicine and industry, reported that about 1 million warrants, issued in connection with the company's June 1999 IPO, are set to expire on March 31. The company's board said that the expiration of the IPO warrants should enable it "to better execute on certain strategic initiatives to expand its security business."
Anthony Armini, PhD, CEO of Implant Sciences, said, "Our introduction of the commercially available Quantum Sniffer hand-held explosives detection product has been met with success in the marketplace. We are also executing on recent contracts, amounting to approximately $2.5 million in the aggregate, received from the Navy, for delivery of a backpack explosives detection device, and the TSA, for development of the next-generation passenger portal. The continued advances we have made in our patented vortex technology, which is an integral component of our proprietary Quantum Sniffer technology, has also resulted in our initial development of potential new products for the detection of improvised explosives devices and car bombs."