Medical robotics company Myomo Inc. goes public with IPO offering of $5 million at $7.50 per share. The Cambridge, Mass., company specializes in mobility devices for the arms and hands.
The company's initial public offering was for 665,498 shares of common stock, sold at $7.50 per share for a total of $5 million. An additional private investment sale of restricted securities resulted in $2.9 million, totaling $7.9 million for Myomo. The private sale was closed primarily to those already investing in the company.
Cash flow is expected to be used in the company's assistive prosthetic devices and marketing. "The proceeds raised provide Myomo with the resources to continue to invest in the Myopro product line, as well as increase our sales and marketing efforts to grow our business domestically and internationally," said Paul Gudonis, Myomo chairman and CEO. The company has raised more than $24 million in financing, Gudonis told BioWorld MedTech. The company raised $13.52 million in four funding rounds, led by Mountain Group Capital of Nashville.
With prior investments, the company has launched a controlled introduction of its lightweight wearable device to patients, gained approval by the VA and launched a second generation device. Their next step was to introduce the device to a larger base of investors.
Broader investor pool
"We thought we would now go tap the public capital markets to reach a wider audience of potential investors," Gudonis told BioWorld MedTech. "If you know 100 people you probably know someone who needs this technology, because the prevalence of upper limb paralysis is about one percent. We're enabling people who are paralyzed due to strokes, spinal cord injuries, shoulder nerve injuries, traumatic brain injuries, MS, ALS to use their paralyzed arms and hands again. So the general public is investing because they also support the mission of the company as well as the opportunity to build a profitable new company."
Myomo's device was developed using technology licensed from the Massachusetts Institute of Technology (MIT). "We have the only lightweight wearable robotic devices that enable paralyzed arms and hands to move again, so it's a very large unmet need," said Gudonis. "Up until now these individuals have been told if after six months or rehab therapy, if you haven't recovered the ability to use that limb get used it, that's the way it's going to be for the rest of your life." The device they produce offers another option to use that arm or hand again, Gudonis told BioWorld MedTech.
"We operate at the intersection of two very exciting fields, neuroscience and robotics. We are basically taking these weak neurological signals and amplifying them," he explained. "This is like power steering for my arm."
Electrical signal booster
Myomo's Myopro myoelectric powered brace for the arm can restore movement for patients with paralyzed or damaged arms or hands. The device works by "sensing a patient's own neurological signals through noninvasive sensors on the arm, [and] can restore their ability to use their arms and hands so that they can return to work, live independently and reduce their cost of care," according to the company. Myoelectric devices capitalize on the myoelectric signal the body sends to move any body part. The device uses those signals to guide the prosthetic, and complete the desired movement such as picking up or carrying an item.
Myomo was added to the New York Stock Exchange June 12 as MYO; the company joined NYSE under Jumpstart Our Business Startups (JOBS) Act Regulation A+. This particular IPO allows the general public to invest in the company, and opens the potential for institutional involvement as some require a company to be publically traded. "We hope it'll pave the way also for other medical technology companies to raise capital, to bring their new therapies and products to the marketplace," Gudonis told BioWorld MedTech.
Myomo will utilize the IPO and further funding to add to sales and marketing efforts, conduct clinical trials as well as create clinical collaborations around the U.S. The company will distribute its device through a three-year agreement inked with Ottobock of Germany. Additionally, Myomo will begin working with the Children's Hospital of Philadelphia to create "child-sized devices for the 150,000 children under 18 with some kind of paralysis" said Gudonis.
The company has created an independent board of directors and will file quarterly, annual and other reports as required with the NYSE listing. Patients using the device will also ring the closing bell at NYSE on Friday.
Robotics have also been gaining traction in the surgical device space. Intuitive Surgical, of Sunnyvale, Calif., is considered the top surgical device maker with its Da Vinci robots, and may continue to thrive. Industry analyst, Lawrence Biegelsen of Wells Fargo, commented in May that "the use of surgical robotics may be at an inflection of broader acceptance" after large players have entered the space. He added "We believe that ISRG is well positioned to capitalize on the shift to surgical robotics given its installed base and history of technological innovation." The company plans to expand to catheter robots, diagnostics, imaging and single port access. (See BioWorld MedTech, Feb. 22, 2017.)
Earlier this year, Medrobotics Corp., of Raynham, Mass., maker of the Flex Robotic System, raised $20 million in preferred stock financing, for a total of more than $100 million since the company's founding in 2006. (See BioWorld MedTech, Feb. 22, 2017.) Financing allowed the company to further research an abdominal port entry for general, gynecological and urologic surgeries. The company won CE mark for colorectal use in 2014, FDA clearance in 2015 for ear, nose and throat use.
Johnson & Johnson Corp.'s Ethicon unit also launched a partnership with Verily Lifesciences LLC to create a digital surgery platform. (See BioWorld MedTech, Jan. 27, 2017.)