Alung Technologies Inc. has closed on its $36 million series C financing round that will go toward funding a pivotal trial for the private company's respiratory dialysis technology. The round was led by Royal Philips NV and UPMC, through its innovation and commercialization arm UPMC Enterprises. Other investors include Danvers, Mass.-based Abiomed, The Accelerator Fund, Allos Ventures, Birchmere Ventures, Blue Tree Ventures and Riverfront Ventures. Raymond James & Associates Inc. acted as lead placement agent for the transaction.
The Pittsburgh-based company is seeking FDA approval for the Hemolung Respiratory Assist System (RAS), a minimally invasive artificial lung device.
The technology is a dialysis-like alternative or supplement to mechanical ventilation. Alung said the device could treat patients suffering from acute respiratory distress syndrome and chronic obstructive pulmonary disease. Company executives said the market for the device was about $6 billion.
Scott Morely, senior vice president of market development at Alung, told Medical Device Daily Hemolung is a "minimally invasive approach to extracorporeal carbon dioxide removal (ECCO2R)."
The investment by Philips and UPMC will bring more than capital to the company, with both organizations offering resources and expertise to support Alung's work. Members from both Philips and UPMC Enterprises will serve on Alung's board.
Peter DeComo, Alung's chairman and CEO told MDD the funding round should take the company "through the pivotal trial."
He said there were no plans for additional funding, but he did not rule out future financing rounds. DeComo has been the company's CEO since 2009. (See Medical Device Daily, Dec. 23, 2008).
Alung raised about $12 million in February of 2016. Nearly four years ago, the company closed on $15.8 million in a series B-1 financing round. (See Medical Device Daily, Sept. 12, 2013.)
Hemolung received the CE mark in 2013 and has been sold in Europe since 2014. The device has approval in other areas outside of the U.S., including Canada and Australia. Nearly two years ago, Alung's device was one of several to successfully enter the FDA's Expedited Access Pathway voluntary program, which seeks to facilitate patients' access to medical device technologies that could fulfill unmet medical needs for life-threatening or irreversibly debilitating diseases or conditions.
DeComo said Alung faces off against other companies with ECCO2R solutions. He noted that Alung had an advantage, because its device was built from the ground up, while other technologies were modified or constructed from existing devices.
The company said other devices in this space are referred to as passive oxygenators, which lead to a passive decrease in CO2 removal in a passive oxygenator. The Hemolung RAS, by contrast, is designed with the company's Activmix technology to provide highly efficient extracorporeal CO2 removal at dialysis-like blood flow rates. Company executives noted that the Hemolung sees no deterioration of CO2 removal over time and the device can get an efficient CO2 gas exchange, typically two times higher than a passive oxygenator.
One of Alung's competitors is Fresenius Medical Care AG & Co. The Bad Homburg, Germany-based company gained entry into the ECCO2R treatment space through its acquisition of Xenios AG for an undisclosed sum last year. (See Medical Device Daily, Nov. 7, 2016.) Heilbronn, Germany-based Xenios has developed the Novalung, which has not obtained approval from the FDA.
DeComo said there were some large competitors in the space, but welcomed the competition and the opportunity the firms provided to "bring more attention to ECCO2R therapies."
There are some advancements in the space to help develop temporary artificial lungs for patients.
Last month, the University of Pittsburgh received a $3.4 million National Institutes of Health grant, to develop an artificial lung to serve as a bridge to transplant or recovery in patients with acute and chronic lung failure.
Researchers said the Paracorporeal Ambulatory Assist Lung (PAAL) device will complement recent efforts by the University of Maryland (which developed a wearable artificial pump-lung) by potentially improving the efficiency of the transfer of oxygen and carbon dioxide and increasing biocompatibility.
Alung shares some common ties to the PAAL technology. The company was spun out from the University of Pittsburgh in 1997. In addition, William Federspiel, the principal investigator for PAAL founded Alung and is an equity holder in the company.