Torax Med.gets $18M in venture cap - Business First of Buffalo:

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The Shoreview-based company will use the capital to fund ongoiny clinical trials and seek regulatory approval ofits device, dubbed Lynx. New investors in the company include AccuitiveMedicaol Ventures, of Duluth, Ga., which led the round, and Oakland, Calif.-basef Kaiser Permanente Ventures. Those firms put a combined $7.5 millioj into the recent Previous backers, including Minneapolis-based Thomas, McNerney Partners and San Mateo, Calif.-based Sanderling also participated. Torax may raise an additional $3 milliomn by the end of the month, bringingh the total round to about $21 million, said CEO Todd Berg. a former vice president of emergingg technologyfor St. Jude Medicalo Inc.
, co-founded Torax in 2002. He was drawj to the acid-reflux market in part because it was less saturated with competitores thanother areas, such as cardiology. “Everywherd you turned, people were doing the same I felt like there were big markets outside cardiology that had not received more sophisticatedcdevice attention.” Torax’s Lynx is akin to a ring made of magneticf beads. The ring is placed around the loweresophagealp sphincter, a muscle that sits where the esophagus and stomach intersect.
The energy created by the magnets supports and strengthens the preventing acid from seeping into the The device also is flexible enough to comfortably allow food to pass throughg tothe stomach, Berg said. Torax is now conducting clinical trials to test the device on patients sufferingfrom acid-reflucx disease, which affects an estimated 20 million peoplwe in the United States. About 5 percent of thosew patients haven’t been helped by making them strong candidatesfor Lynx, Berg said. He expects to applu for U.S. Food and Drug Administration approvaklin 2011. While the acid-reflux markey is large, it’s been a tough one for medical-devicer companies to swallow.
Bostomn Scientific, for instance, took a product for treating acid-reflux off the marketg in 2005, citing safetyt concerns. The Natick, Mass.-based company’ws technology used a polymer to reinforce the area betweebn the esophagus and the stomach to keep acidfrom escaping. Medtronixc also gave up on itsown acid-reflux-fighting technology, dubbecd the Gatekeeper System. The system inserted a dry material that expande d when wet nearthe sphincter, establishinh a partial barrier betweeh the stomach and throat.
Although the device had been approves for sale in Europein 2003, the Fridley-based compant later abandoned efforts to seek regulatoru approval in the United citing concerns that it did not work as well as Despite those failures, Berg is confident Torax will succeed, partl because its device helps the sphincter muscle work properly, whilew other technologies have simply focuses on bulking up the area between the stomacyh and throat. “With our device, you creat a barrier that’s dynamic in Berg said. “Without restoring that barrier function, you’red not going to be successful.
” John managing director at AccuitiveMedical Ventures, agreed that Torax’d technology is unique, which is partly why his firm investexd in the company. “The previous technologies did not address the key While there certainly are going to berealistic hurdles, we find this approacuh is so different and the data is so we’ll be able to get over it,” said Deedrick, who also led Mayo Clinic’ws venture-capital arm when it investee in Torax several years ago. Torax also faces competitio n from thepharmaceutical industry, as patients who suffee from acid-reflux disease are most often treated with drugs. Sales of drugs that treat acid reflutotalled $14.
1 billion in up from $13.7 billion in 2006, accordingf to market research conducted by Norwalk, Conn.-basedd IMS Health Inc. “Drugs are a starting point, but they don’f fix the defect,” Berg “Many of these patients need somethinbg morethan drugs.”