A Medical Device Daily

Syneron Medical (Yokneam, Israel/Toronto) reported closing its previously announced secondary offering, by selling shareholders, of seven million of its ordinary shares at $28 a share, raising gross proceeds of $196 million. The round was priced earlier this month (Medical Device Daily, March 10, 2005). The selling shareholders have granted the underwriters a 30-day option to purchase up to another 1.05 million of their ordinary shares.

Syneron makes devices powered by its Electro-Optical Synergy (ELOS) combined-energy technology of Bi-Polar Radio Frequency and Light providing the platform for a range of medical/aesthetic applications, including hair removal, wrinkle reduction, skin rejuvenation through the treatment of superficial benign vascular and pigmented lesions, and the treatment of acne, leg veins and the appearance of cellulite.

Lehman Brothers and CIBC World Markets acted as joint book-running managers of the offering with Citigroup Global Markets serving as a joint lead manager. Stephens, Thomas Weisel Partners, and C.E. Unterberg, Towbin acted as co-managers.

Development-stage firm CardioVascular BioTherapeutics (Henderson, Nevada) reported concluding the sale of 1,725,000 shares of its common stock at $10 a share.

The stock is now trading on the Over-the-Counter Bulletin Board under the symbol CVBT.

CardioVascular Bio is focused on developing a drug regimen for the treatment of cardiovascular diseases. Its main candidate, Cardio Vascu-Grow, is a fibroblast growth factor that induces angiogenesis (blood vessel growth). When injected directly into the heart near affected arteries, Cardio Vascu-Grow has been shown to help repair the artery and increase blood flow to the heart. The company hopes to demonstrate that this regimen also will benefit the victims of stroke and diabetes.

Daniel Montano, company president, CEO and chairman, and Thomas Stegmann, chief clinical officer, each own nearly 30% of the company.

The company filed its IPO registration statement with the Securities and Exchange Commission in September.

In other financing activity:

• CryoLife (Kennesaw, Georgia) reported the offering of 400,000 shares of 6% convertible preferred stock at a price of $50 a share. Estimated net proceeds of the offering will be about $18.3 million. CryoLife also has granted the underwriter in the offering a 30-day option to purchase up to an additional 60,000 shares of convertible preferred stock to cover any over-allotments.

The company said it plans to use the net proceeds for working capital and general corporate purposes.

The stock has been listed on the New York Stock Exchange under the symbol CRY Pr. Each share of convertible preferred stock is convertible into 6.2189 shares of CryoLife common stock, based on a conversion price of $8.04 a share. Piper Jaffray & Co. served as offering underwriter.

CryoLife is a leader in the processing and distribution of implantable living human tissues for use in cardiovascular and vascular surgeries throughout the U.S. and Canada. The company's BioGlue Surgical Adhesive is FDA-approved as an adjunct to sutures and staples for use in adult patients in open surgical repair of large vessels; CE-marked; approved in Canada for use in soft tissue repair; and approved in Australia for use in vascular and pulmonary sealing and repair.

• ViaCell (Cambridge, Massachusetts) and Genzyme (also Cambridge) reported a collaboration in which, over the next 18 months, Genzyme will conduct research to improve production and characterization of islet stem cells and undertake preclinical proof-of-concept studies for the transplantation of adult islet stem cells derived from donated pancreatic tissue. ViaCell will work with Genzyme and conduct complementary preclinical research. No financial terms of the agreement were announced.

ViaCell also reported the issuance of U.S. Patent No. 6,866,843, titled "Method of transplanting in a mammal and treating diabetes mellitus by administering a pseudo-islet like aggregate differentiated from a nestin-positive pancreatic stem cell." This patent, exclusively licensed from the Massachusetts General Hospital (MGH; Boston), covers methods for the treatment of Type 1 insulin-dependent diabetes mellitus and other conditions using nestin-positive islet derived progenitor cells (NIPs), which can be expanded and differentiated into pancreatic islet cells, i.e., insulin-producing beta cells.

This discovery is based on the work performed by the group of Dr. Joel Habener, chief of the Laboratory of Molecular Endocrinology in the Department of Medicine at MGH, investigator for the Howard Hughes Medical Institute (Chevy Chase, Maryland) and professor of medicine at the Harvard Medical School (Boston).

"Our collaboration that we entered into with Genzyme in December 2004, and the patent issuance are two important milestones for ViaCell's pioneering program in diabetes," said Marc Beer, CEO of ViaCell. "Our approach uses adult islet stem cells derived from donor tissues. We have seen promising results to date in our research work, and Genzyme has excellent development capabilities which we believe will be helpful in achieving the proof of concept in preparation for human clinical trials."

Georges Gemayel, executive vice president at Genzyme, said that the agreement "represents a natural evolution of our four-year relationship with ViaCell . . . and we look forward to applying our expertise to the preclinical development of this program."

ViaCell's program uses nestin-positive pancreatic stem cells, and, to date, the company said it has successfully expanded and differentiated these cells and demonstrated their ability to produce insulin.

Founded in 1981, Genzyme characterizes itself as "a leader in the effort to develop and apply the most advanced technologies in the life sciences."

ViaCell's technologies include Selective Amplification technology, which the Company believes will enable the development of high-definition stem cell products based on the isolation, purification and significant expansion of targeted stem cell populations.

• V.I. Technologies (Vitex; Watertown, Massachusetts), a biotech firm developing anti-infectives, said that its board has approved a 1-for-10 reverse stock split in accordance with previous board authorization to effect a reverse split in the range of 1:5 to 1:20. Shares held, as of business close March 14, will be split, and shares began trading on a post-split basis yesterday. Vitex will have about 38.2 million shares outstanding after the reverse split.

For a period of 20 trading days following the split, the company's common stock will trade under the temporary symbol VITXD to reflect the split. All warrants, options and common stock outstanding at the time of the split, including common stock issued as part of the merger with Panacos Pharmaceuticals (MDD, March 15, 2005) and common stock and warrants issued in the recently completed $20 million private placement, will also be adjusted by the ratio.

Samuel Ackerman, chairman and CEO, said the split "is important for maintaining compliance with the $1 minimum bid price listing requirement on the Nasdaq National Market."

Vitex's Inactine technology is designed to inactivate a wide range of viruses, bacteria and parasites, and has demonstrated its ability to remove prion proteins.

• Per-Se Technologies (Alpharetta, Georgia) said its registration statement, for resale of its 3.25% convertible subordinated debentures due 2024 and the common stock issuable upon conversion of the debentures, was declared effective by the Securities and Exchange Commission at 5:30 p.m. EST, March 14.

Per-Se issued $125 million principal amount of the debentures in a private placement in June 2004. The company will not receive any of the proceeds from any resale of the debentures or any underlying shares of common stock.

Per-Se develops Connective Healthcare solutions which it says "help reduce administrative expenses, increase revenue and accelerate the movement of funds to benefit providers, payers and patients."