EnteroMedics pulls trigger on 1-for-15 reverse split

EnteroMedics (NSDQ:ETRM) said today its board authorized a 1-for-15 reverse stock split, effective on January 7 next year.

As a result of the split, every 15 shares of stock in the St. Paul, Minn.-based company will be consolidated into a single share.

“Shareholder approval of these proposals gives us the tools to execute the financial strategy underlying our commercial strategy for vBloc Therapy.  We continue to execute on a number of initiatives for providing patient access to this groundbreaking new treatment for obesity, including public and private payer reimbursement.  This process, while time consuming, is a cornerstone of our product launch strategy, and we now have the financial resources in place to reach a number of important commercial goals,” CEO Dan Gladney said in a press release.

Any fractional shares of common stock from the reverse split will be rounded to the nearest whole share while fractional shares of common stock pursuant to stock options or warrants will be rounded down.

The company said it issued common stock underlying convertible notes and warrants from a securities purchase on November 4, distributing $25 million in senior amortizing convertible notes and warrants to 5 institutional investors.

EnteroMedics said $1.5 million of notes and warrants were issued at closing, and the remainder will be issued in tranches of $11 million and $12.5 million.

Proceeds from the offering will support the company’s vBloc Neurometabolic therapy and its Maestro device.

The Maestro device functions by stimulating the vagal nerve, which is associated with hunger and satiety, in a specific manner that St. Paul, Minn.-based Enteromedics says helps patients lose weight. To control for differences between groups, the sham devices contained a similar neuroregulator that dissipated charge into a resistor at a rate similar to the active device.

The post EnteroMedics pulls trigger on 1-for-15 reverse split appeared first on MassDevice.

from MassDevice http://ift.tt/1NLVbki

The 5 biggest medtech stories of 2015

MassDevice.com‘s editorial team put their heads together and came up with a list of the 5 most significant stories to cross the medical device space in 2015:

1. Mergers & acquisitions run rampant

---

This year began with the closing of the largest medtech merger in history: Medtronic’s $50 billion acquisition of Covidien. The deal was notable not just because of its size; it allowed Medtronic to reincorporate in Ireland, freeing billions in cash the Fridley, Minn.-based company pledged to use in part on acquisitions.Medtronic went on to fulfill that promise with a billion-dollar buying spree, paying $110 million for Aircraft Medical; $235 million for RF Surgical Systems; $110 million for Aptus Endosystems; $93 million for CardioInsight Technologies; $458 million for Twelve Inc.; $150 million for Medina Medical; $100 million for Lazarus Effect; an unspecified amount for Sophono; and took out unspecified stakes in Arsenal Medical subsidiary Arsenal AAA, Semma Therapeutics and Glooko. If you’re keeping score at home, that amounts to an M&A spend of at least $1.26 billion, excluding the Covidien deal. Consolidation was the name of the game across all tiers of the medical device space, from small contract manufacturing all the way to unions valued in the billions. A few notable transactions included:

• Greatbatch (NYSE:GB) pays $1.73 billion for OEM medical device maker Lake Region Medical.
• Pfizer (NYSE:PFE) agrees to pay $160 billion for Allergan (NYSE: AGN).
• St. Jude Medical (NYSE:STJ) pays $3.3 billion for Thoratec.
• Cardinal Health (NYSE:CAH) pays $1.94 billion for Johnson & Johnson’s (NYSE:JNJ)’s Cordis stent-making arm.
• Wright Medical (NSDQ:WMGI) and Tornier (NSDQ:TRNX) ink $3.3 merger-of-equals.
• Hill-Rom (NYSE:HRC) pays $2.05 billion for Welch Allyn.
• Dentsply International (NSDQ:XRAY) and Sirona Dental Systems (NSDQ:SIRO) ink an all-stock deal worth $5.56 billion.
• Pfizer (NYSE:PFE) pays $15 billion for Hospira.
• Boston Scientific (NYSE:BSX) pays $1.6 billion to buy the American Medical Systems urology biz from Endo Health Solutions.
• Four things every emerging medtech should know about M&A.

The post The 5 biggest medtech stories of 2015 appeared first on MassDevice.

from MassDevice http://ift.tt/1IqzlWR

Intuitive Surgical puts another $9 million into Luna Innovations’ shape-sensing tech

Luna Innovations (NSDQ:LUNA) said today that Intuitive Surgical (NSDQ:ISRG) agreed to put up another $9 million for the shape-sensing technology it bought for its da Vinci robot-assisted surgery platform.

Pleasanton, Calif.-based Intuitive paid a total of $12 million last year for the technology, which is designed to provide real-time measurements to help surgeons sense positions and track locations in the body during surgery. The latest installment closes out the deal, which once included milestones worth another $18 million.

“Although the technical milestone is still under development, both companies agreed that it was in our mutual best interests to settle the remaining obligations,” Luna president & CEO My Chung said in prepared remarks. “This arrangement allows Luna to accelerate the receipt of cash, thereby strengthening our balance sheet while eliminating our exposure to future development risks.”

Roanoke, Va.-based Luna and Intuitive revised their original licensing agreement in July 2013, sending LUNA shares up more than 40% in a single day. Luna’s stock more than doubled in January 2014 after the company announced that it sold the shape-sensing technology to Intuitive.

LUNA shares opened up 3.7% at $1.04 apiece today.

The post Intuitive Surgical puts another $9 million into Luna Innovations’ shape-sensing tech appeared first on MassDevice.

from MassDevice http://ift.tt/1NLBOb1

OrbiMed launches $950m healthcare fund

OrbiMed said it closed another venture capital fund worth $950 million that it plans to deploy on about 30 companies in the medical device, biopharmaceutical, diagnostics and healthcare IT markets.

The New York-based VC giant said its OrbiMed Private Investments VI fund will put up investments ranging from $10 million to $75 million. Last year OrbiMed floated a $924 million fund it planned to use in $20 million to $150 million increments for acquiring healthcare royalty streams. Back in the fall of 2013 OrbiMed launched a $735 million healthcare fund.

Backers for the newest fund include “some of the preeminent medical research institutions globally, along with leading endowments, foundations and sovereign wealth funds,” OrbiMed said.

“The increasing pace of translation of science to medicine creates exciting opportunities for the fund in areas such as oncology, central nervous system disease, and gene editing,” partner and global private equity co-head Carl Gordon said in prepared remarks.

“With this Fund we plan to accelerate our collaborations with leading life sciences entrepreneurs, strategic companies, research institutions and physicians, to drive the creation of novel therapies that address unmet medical needs,” added Jonathan Silverstein, also partner and global private equity co-head.

The post OrbiMed launches $950m healthcare fund appeared first on MassDevice.

from MassDevice http://ift.tt/1U4wQKh

CryoLife in $130m deal to enter valve market with On-X Life Technologies buy

CryoLife Inc. (NYSE:CRY) made a big play yesterday for the mechanical heart valve space with a $130 million deal to buy On-X Life Technologies.

On-X makes an aortic valve replacement and is developing a mitral chord repair device called Chord-X. The Austin, Texas-based company put up sales of about $33 million last year, CryoLife said.

The deal calls for Atlanta-based CryoLife to pay roughly $91 million in cash from a new credit facility and another $39 million worth of CRY shares. CryoLife said it’s already lined up a 5-year, $75 million term loan and a $20 million revolver from Capital One, Fifth Third Bank, and Citizens Bank. The acquisition is expected to close in January 2016.

“We believe this will be a transformative acquisition for CryoLife that will significantly enhance the size of our addressable market and growth potential. This transaction will provide CryoLife access to the $220 million mechanical valve market with a highly advanced portfolio of products,” chairman, president & CEO Pat Mackin said in prepared remarks. “On-X valves have been implanted in over 200,000 patients, and On-X has achieved a 13% revenue CAGR over the past 4 years with modest sales and marketing support.”

“On-X is extremely excited to join forces with CryoLife and we believe CryoLife is well suited to take the On-X business to the next level. We expect this transaction to enhance the growth trajectory of On-X products through the additional resources provided by a larger, global cardiac surgery company,” added On-X president & CEO Clyde Baker.

Mackin said the deal more than doubles CryoLife’s U.S. cardiac surgery sales force and forecast a double-digit compound growth rate from 2016 to 2020. CryoLife’s tissue valve business is complemented by the mechanical valve business it’s buying with On-X, he said.

CryoLife also said its board decided to stop paying dividends “for the foreseeable future.”

The post CryoLife in $130m deal to enter valve market with On-X Life Technologies buy appeared first on MassDevice.

from MassDevice http://ift.tt/1QLnO72

Neural Analytics raises $10m Series A for brain trauma tech

Neural Analytics said it reeled in a $10 million Series A round it plans to use on a clinical trial of its device for detecting traumatic brain injuries.

Los Angeles-based Neural Analytics said participants included new backers JSR Limited and Taiyu Capital, a subsidiary of TigerMed. A seed round last year brought in $3 million, the company said.

“Neural Analytics is very pleased to complete this financing, and we welcome JSR Limited and Taiyu to our multinational syndicate of top tier investors,” co-founder & CEO Leo Petrossian said in prepared remarks. “This remarkable level of interest and significant capitalization demonstrates high confidence in our team and the excitement around the launch of our clinical trials early next year.”

The Neural Analytics device is designed to measure, assess and track traumatic brain injuries using transcranial doppler measurements to determine brain blood flow activity, according to the company’s website.

The post Neural Analytics raises $10m Series A for brain trauma tech appeared first on MassDevice.

from MassDevice http://ift.tt/1V7i9qN

Coloplasty, Liberator Medical pay $3.6m to shed kickbacks case

Coloplast (CPH:COLO B) and Liberator Medical (NYSE:LBMH) agreed to pay a collective $3.6 million to settle allegations that they ran a kickbacks scheme to fuel sales of the Danish ostomy device maker’s products, federal prosecutors said yesterday.

Coloplast agreed to pay $3.16 million and Liberator $500,000 to settle the case, although they admitted no liability in the settlement. Prosecutors accused Coloplast of paying kickbacks to Byram Healthcare Centers, CCS Medical, Liberty Medical, Handi Medical and Liberator in return for marketing promotions and conversion campaigns – including in some cases so-called “spliffs,” or payments to sales personnel in return for referrals to Coloplast products.

The deal with Liberator settles charges that it received price concessions from Coloplast in return for a pair of promotional campaigns, the prosecutors said. The settlements are part of a qui tam lawsuit brought by a trio of whistleblowers from Coloplast, they said. The whistleblowers’ share of the settlements hasn’t been determined and claims against other defendants are still being prosecuted, they said. Hollister, 180 Medical, Byram Healthcare Centers, CCS Medical, RGH Enterprises (dba Edgepark Medical Supplies) and Shield California Health Care Center are also named in the whistleblower lawsuit, according to court documents.

“The payment of kickbacks to induce purchases of medical supplies undermines our federal health care programs, ultimately distorting consumer purchasing decisions, and increasing health care costs,” Massachusetts U.S. Attorney Carmen Ortiz said in prepared remarks. “Investigating claims of misguided business practices, at the expense of patient health, will continue to be a top priority in our healthcare enforcement efforts.”

Last month,C.R. Bard (NYSE:BCR) agreed to pay $181 million to acquire Liberator.

The post Coloplasty, Liberator Medical pay $3.6m to shed kickbacks case appeared first on MassDevice.

from MassDevice http://ift.tt/1RG2qjE