OmniSonics Medical Technologies (Wilmington, Massachusetts), a developer of medical devices to treat vascular occlusive disease, last month reported the final close of its Series C round of financing, producing an aggregate total of $43 million for the round. This constitutes the largest funding in the U.S. for a medical device company over the past 12 months, according to VentureSource, which maintains a database on the venture capital industry. OmniSonics had reported last October that it had secured $26 million in its Series C round, but due to additional investor interest, the round reopened, and resulting amounts increased the total by about 65%, OmniSonics officials said.
"This money clearly gets us to profitability," Daniel Geffken, senior vice president and chief financial officer of the company, told Cardiovascular Device Update. Geffken said he "did not have a number" on when profitability might be achieved but indicated it likely would not come before 2006.
OmniSonics is developing an acoustic technology to treat vascular occlusive disease, a set of conditions characterized by life-threatening occlusions that constrict blood vessels throughout the body. Based on the company's OmniWave Technology platform, its Resolution System is designed to resolve occlusions often blood clots, plaque or calcific materials that occur as a result of coronary artery disease, hemodialysis procedures, deep vein thrombosis and peripheral artery disease. The device, consisting of a thin, titanium wire that is placed into a clogged artery or vein, delivers low-power, acoustic energy to break up blood clots into minute particles, about the size of red blood cells. The technology has the CE mark and is commercialized in Australia for the treatment of peripheral vascular disease.
In the U.S., OmniSonics is "nearing the end" of a pivotal study for clearing occlusions in hemodialysis grafts, Geffken said, predicting that the company will make a filing with the FDA for that application in the second half of 2004 and is hoping for commercial okay before year-end. The "C" round of funding will be used to broaden and expand the company's clinical trials, Geffken said, and to build a U.S. sales and marketing infrastructure, assuming the initial FDA clearance.
On the drawing board is the launch of a study using the OmniWave technology for deep vein thrombosis in the second or third quarter, Geffken said, with another clinical trial to be launched in Australia late this year to study the technology for the treatment of coronary occlusions. He acknowledged that the system's initial application in occlusions of hemodialysis grafts is "not a huge one but, sequentially, you go to deep vein thrombosis and then the home run is in the coronary application." Geffken said, "We have the potential to build a very large company, and that's obviously some of the thinking behind the size of the [C round] financing."
Robert Rabiner, OmniSonics' chief executive officer, characterized the funding as representing "overwhelming confidence from the investment community. With funding to get us to profitability, we are focused on driving all of our clinical programs forward aggressively." He added: "As we draw closer to anticipated FDA clearance here in the U.S., we look toward commercialization and other significant milestones." The "C" round followed a "B" round of financing that raised $21 million in 2001.
AbioCor implantation in Houston
The first implantation of an AbioCor Replacement Heart since last May was reported early this month by the device's manufacturer, Abiomed (Danvers, Massachusetts). Abiomed said the implantation, the 12th in a clinical trial that began in July 2001, occurred Feb. 20 at the Texas Heart Institute at St. Luke's Episcopal Hospital (Houston, Texas). As is Abiomed's policy, no additional patient information was released. The company said additional information would be made available when the Texas Heart Institute clinical team and the patient's family "deem it is appropriate."
The AbioCor device is the subject of a clinical trial being conducted under an investigational device exemption from the FDA. Abiomed has reported its intention to seek initial FDA market approval this year for the AbioCor to treat a defined subset of irreversible end-stage heart failure patients under a humanitarian device exemption. The FDA-established criteria for candidates for the AbioCor clinical trial are that they must suffer from biventricular heart failure, be ineligible for heart transplantation, unable to be helped by any other available therapy and have a high probability of dying in less than 30 days.
Three other AbioCor implantation procedures have taken place at Texas Heart Institute under teams led by O.H. (Bud) Frazier, MD, chief of cardiopulmonary transplantation. One would-be recipient died during the procedure, apparently due to anti-coagulation medication he already was taking prior to the surgery.
Abiomed has FDA approval to implant the replacement heart in 15 patients in the current trial. Ed Berger, vice president of strategic policy and planning at Abiomed, had said during a company conference call on Feb. 10 that "the next implant could happen at any time." Thus far, implantations have taken place at Jewish Hospital (Louisville, Kentucky), St. Luke's, UCLA Medical Center (Westwood, California) and MCP Hahnemann University Hospital (Philadelphia, Pennsylvania). In last month's conference call, Berger noted that Beth Israel Deaconess Medical Center (Boston, Massachusetts) had been added to the clinical site list for possible future implantation of the AbioCor device. Three European sites also have been identified, but no implantations have taken place in any of them to date.
In addition to the AbioCor Replacement Heart, Abiomed has developed the AB5000 Biventricular Support System and the AB5000 Circulatory Support System. The FDA-approved AB5000 is categorized by the company as a ventricular assist device (VAD) that is deployed outside the body rather than implanted, as are most VADs.
CardioGenesis reports business unit creation
CardioGenesis (Foothill Ranch, California), developer of angina-relieving transmyocardial revascularization (TMR) and percutaneous myocardial revascularization (PMR) products, last month revealed plans to create three new business units. It also reported the promotion of Richard Lanigan to senior vice president, marketing, and of three other senior managers to lead those units. The company said each of the new business units would have full top- and bottom-line accountability, with two of them responsible for domestic and international sales and marketing in their respective geographies and the third providing maintenance and repair services to the company's worldwide customer base.
The Pacific Division, to be led by newly promoted vice president, general manager Lorrie Orton, will be responsible for a territory that includes all of North America west of the Mississippi River, as well as key markets in the Pacific Rim. The Atlantic Division includes all of North America east of the Mississippi River, as well as Europe and the Middle East, and it will be led by senior vice president Henry Rossell, who was named general manager of the division. The Worldwide Services Division will be run by Gerard Arthur, recently named vice president, general manager.
"We took a fresh look at our organization because this is an incredibly important time, given that we are launching a number of new products to support our new minimally-invasive approach to TMR, and that the lengthy FDA review of PMR should be coming to a close in the upcoming months," said Michael Quinn, CardioGenesis chairman and chief executive officer.