A Medical Device Daily

Less than three months after securing $11 million in financing, SpineGuard (Paris), a medical device start-up has made its $15 million goal by securing $4 million last week, the company said.

The recent $4 million investment was by Delta Partners (Boston) and will help to establish the company's FDA-cleared and CE-Marked PediGuard device as the standard of care for safer pedicle screw placement in spine surgery.

"This additional funding and the support of Delta Partners and Maurice Bourlion will fortify our efforts to establish PediGuard as a standard of care for safer spine surgery," said Pierre Jérôme, CEO of SpineGuard told Medical Device Daily. "Now we are completely secure that we have the right level of funding."

SpineGuard says the PediGuard is the only wireless, handheld instrument capable of accurately detecting changes in tissue type, thus alerting surgeons to potential pedicular or vertebral breaches during pedicle screw site preparation. The device provides real-time feedback via audio and visual signals, giving surgeons additional information. The company notes that the device does not require any change in surgical technique.

On April 9, SpineGuard reported an $11 million round of financing from Crédit Agricole Private Equity (lead), Innoven Partenaires (co-lead), and A Plus Finance.

The company acquired PediGuard from SpineVision (also Paris) with the initial funding it received (Medical Device Daily, April 10, 2009).

Jérôme says that the market for the device is perfect and that the company should settle in nicely.

According to the company, nearly one million spine procedures using pedicle screws were performed last year. Published studies say that pedicle screws show high rates of misplacements — as high as 40% — which can lead to a number of serious complications for patients, including quadriplegia. Consequently, liability risks for spine surgeons are high.

Several peer-reviewed publications now validate the value proposition of PediGuard for spine professionals and their patients: pedicle breach anticipation plus reduction of radiation exposure and surgery time. It has a stake in the ground on all continents: impressive ramping-up of sales in the U.S., a strong base in Europe, a great start in Latin America, and significant interest from the Pacific Rim. SpineGuard is partnering with the best distributors to allow more spine surgeons throughout the world to use PediGuard and more patients to benefit from safer spine stabilization.

In other financing activity:

• PhysioSonics (Bellevue; Washington), an innovator of noninvasive neurologic monitors, reported the closure of the second tranche of Series A financing for $2 million from a strategic investor.

The first tranche of Series A closed for $4 million in 2008. This follow-on investment of $2 million by another strategic partner will bring the total Series A funds raised to $6 million.

The company will use these funds for commercialization of their first product "We are very excited with the continued validation of our product development as more neurosurgeons, anesthesiologists and cardiologists view our technology," says Brad Harlow, president/CEO of PhysioSonics.

• NanoCor Therapeutics, (Chapel Hill, North Carolina) reported it has secured a $2.5 million infusion from medical technology company Medtronic (Minneapolis, Minnesota).

In 2007, Medtronic committed to invest $7.5 million in NanoCor. NanoCor said that the additional investment will be used to develop and commercialize its gene therapy. Medtronic has agreed to invest additional amounts upon NanoCor's achievement of certain milestones. NanoCor will also seek additional funding from institutional investors.

NanoCor's technology was developed at the University of North Carolina at Chapel Hill and was licensed to the company. The treatment delivers a proprietary gene that strengthens the heart, improving its ability to pump blood.

• Laboratory Corporation of America Holdings (LabCorp; Burlington, North Carolina) reported that it has completed the redemption of all of its outstanding zero coupon subordinated liquid yield option notes due 2021 (LYONs) and $369.1 million principal amount at maturity.

The total cash used for these redemptions was nearly $289 million. As a result of certain holders of the zero coupon notes electing to convert their zero coupon notes, the company also issued 432,787 additional shares of common stock.

As of March 31, 2009, LabCorp had an aggregate of $576.3 million of accreted principal amount outstanding of the LYONs and of the Zero Coupon Notes. As a result of the redemptions, LabCorp reduced the outstanding accreted principal amount of this convertible debt by nearly $289.6 million, leaving nearly $286.7 million in accreted principal amount, or $369.1 million of principal amount at maturity, of the Zero Coupon Notes outstanding.