2007 in Review
As we look back on 2007, we see a number of positive developments that occurred during the year, plus a few challenges that remain for the neurotechnology industry. From a financial standpoint, the industry continued to post strong results and attract new investment.
Significant mergers that took place during the year include Cardinal Health’s purchase of Viasys for $1.5 billion, Natus Medical’s purchase of Excel-Tech Ltd. for $63.5 million, and Greatbatch’s purchase of BIOMEC, Enpath, and Quan Emerteq, for $11 million, $102 million, and $55 million, respectively.
There was only one significant IPO during the year, EnteroMedics, which raised $40 million. But venture capital investment continued to come in, and much of that for novel applications. Apnex Medical, a neuromodulation firm looking at the sleep disorders market, raised $16.1 million in an A round, CVRx, which is investigating the use of neuromodulation to control hypertension, raised $165 million in a D round, and PhotoThera, which is developing a laser stimulation system to treat ischemic stroke, raised $30 million in a C round. Other VC investment activity included NeuroVista’s $34 million B round, Intelect Medical’s $7 million B round, and Synapse Biomedical’s $4 million C round.
And while there were some noteworthy dissolutions during the year, even these events portend positive developments for the industry. At first glance, Boston Scientific ’s split with Advanced Bionics’ founders might have caused some observers to believe that Boston paid too much for Advanced Bionics in 2004. But it also indicates that there is compound value for a device company that is pursuing both neuromodulation and neural prosthetic product lines. And it should remind entrepreneurs that they can do well by segmenting the applications for the technology they’re peddling.
The management shakeup at Cyberonics and that firm’s continued struggle to obtain reimbursement for its customers with treatment-resistant depression certainly put a damper on the expected growth rates for VNS devices. But the company’s recently announced licensing deal with J&J’s Ethicon unit brings one more major player to the neuromodulation device industry. And we expect the industry to work harder and more cooperatively in the years ahead to confront reimbursement hurdles facing the device industry.
In all, the events of the last year paint a positive picture for the neurotechnology industry and we continue to have high hopes for the growth and maturation of this industry.
Editor and Publisher