Medical Device Daily Associate

CardioOptics (Wilmington, Massachusetts), a company developing therapeutic catheter systems that allow doctors to see directly through flowing blood and inside the heart as they treat cardiovascular disease, said it has completed a $26.5 million Series B financing.

The oversubscribed round was led by new investor Novo A/S and joined by Investor Growth Capital, the Hillman Co. and Rockport Venture Partners, who also are new investors in the company.

Existing investors Cardinal Partners, Sequel Venture Partners and Primus Venture Partners all participated as well.

The company said that proceeds from the financing round would be used primarily to commercialize its first product, the FDA-approved Coronary Sinus Access (CSA) System designed for vision-guided implantation of cardiac resynchronization therapy pacemakers to treat heart failure and to complete development of CardioOptics' therapeutic catheter ablation system to treat atrial fibrillation (AF).

Both products incorporate the company's infrared fiber-optic Trans-Blood Vision (TBV) technology. TBV allows doctors to see forward out the tip of a catheter through flowing blood and directly visualize intracardiac and intravascular anatomy in real time.

“This is an exciting time for the company as we begin to roll out the CSA System this quarter in the U.S. market and finish developing our next-generation AF catheter ablation system in preparation for clinical trials in 2007,“ said President and CEO Todd Davenport.

Davenport told Medical Device Daily that the focus of the CSA System “is to facilitate placing the third lead,“ from a pacemaker into the heart.

He said that all cardiac rhythm therapy or biventricular pacers require that three leads be placed in the heart, two in the “relatively easy areas of the right atrium and the right ventricle.“

The third lead, he said, has to be placed in the more “tricky“ coronary sinus. “That's the one that this system has been designed to significantly reduce the amount of procedure time“ needed for lead placement in the coronary sinus.

As part of this financing, Jack Nielsen from Novo A/S and Stephen Campe from Investor Growth Capital have joined CardioOptics' board of directors.

This round follows a $7.5 million Series A in 2002 led by Cardinal Partners, the company's largest shareholder.

Davenport said the company was able to get by on that amount of funding for so long because it was still in developmental mode.

He said the company emerged from this development phase in January 2005 and received its FDA approval for the CSA System in “late 2005.“

Cardinal's Brandon Hull, a CardioOptics director, said, “Our original investment was premised on the hope that CardioOptics' new technology could be developed into a Trans-Blood Vision product aimed at one or two commercially interesting applications. This outstanding team has not only delivered on the initial premise, but has created significant value by convincingly demonstrating that the revolutionary TBV technology is extensible into a wide range of extraordinary therapeutic markets.“

InSight Health Services (Lake Forest, California) reported that it has extended the expiration date of its offer to exchange up to an aggregate of $300 million principal amount of its senior secured floating rate notes due 2011, which were initially issued on Sept. 22, 2005, for a like principal amount of its registered senior secured floating rate notes due 2011, from 5 p.m. EST on Jan. 19 to 5 p.m. EST today.

InSight provides diagnostic imaging and information, treatment and related management services. Its network currently consists of 113 fixed-site centers and 124 mobile facilities.

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