Orchestra BioMed raises another $35M+ for artery balloons
The new money follows a $41 million financing last fall.
Orchestra BioMed of New Hope said it raised $35 million from Terumo Corp., a $5 billion (in yearly sales) Japan-based medical-device maker, to develop a product it says will help keep human arteries pumping by preventing restenosis, the narrowing of blood vessels.
The investment includes $5 million in equity plus a $30 million one-time payment to help pay for development and commercialization of Orchestra’s Virtue Sirolimus-Eluting Balloon. The company employs more than 25 people, according to a spokesperson. Terumo also promised “substantial future clinical and regulatory milestone payments to Orchestra BioMed," plus royalties and per-unit payments as an exclusive supplier.
Orchestra BioMed said in April that the federal Food and Drug Administration had declared its balloon a “Breakthrough Device,” enabling it to speed through regulatory compliance because it may work more effectively than current treatments.
The Philadelphia area “is a great geography for building a company,” David P. Hochman, cofounder, chairman and chief executive, said Monday. He said his family has a long business history in the region. His mother, Carole, a South Philly native and former Drexel University trustee, is a well-known sleepwear designer. David Hochman said the company expected to have more to say about its plans in the near future.
In a statement, Orchestra BioMed said it hoped to gain a growing share of the fast-expanding “coronary intervention market," which it expects will total $25 billion in yearly spending by 2027.
Orchestra’s founders also include Darren R. Sherman, whose other duties include chief technical officer at Accelerated Technologies Inc. in New York. Directors include Eric Fain, chief executive at Procyrion, San Francisco; Eric A. Rose, chief executive at publicly-traded Siga Technologies, New York; and Geoffrey W. Smith, managing partner at Digitalis Ventures and general partner of Ascent Biomedical Ventures, New York, among others.
Last November, Orchestra BioMed said it had raised $41 million (with $23 million in possible follow-on investments) from unnamed private-equity investors recruited by SternAegis Ventures to develop the balloon, plus a second product, BackBeat Cardiac Neuromodulation Therapy, to treat hypertension. Orchestra BioMed also controls a subsidiary, FreeHold Surgical, which invested in publicly traded Motus GI Holdings Inc., maker of the Pure-Vu colonoscopy cleansing system, and Vivasure Medical Ltd., maker of the PerQSeal skin-patching device.
The company in May told the Securities and Exchange Commission that it was raising additional funds.