Avinger wins $40M commitment backing PAD catheter rollouts

Devicemaker Avinger has snagged up to $40 million in new financing designed in part to fuel continued commercialization of key products such as its Ocelot imaging catheters.

The Redwood City, CA, company terms this a "mezzanine" financing, and it all comes from PDL BioPharma ($PDLI). And it's an unusual arrangement, a creative way to obtain new financing when traditional venture investment in medical devices continues to decline. About $20 million comes up front, with another $20 million due once Avinger reaches revenue milestones in the future. As part of the deal, PDL stands to earn interest and single-digit royalty payments based on Avinger's revenue through April 2018, both parties said in their announcement.

Avinger said it will use the money to back further commercialization of a number of its products, all of which add the use of light and imaging in a new way for peripheral artery disease treatments. Ocelot, for example, crosses a basic catheter with integrated real-time intravascular imaging. Avinger will also use the money to fuel continued work on Pantheris, a lumivascular atherectomy device that uses light-based radiation-free intravascular imaging within the catheter itself, the company explains.

Founder and Avinger CEO John Simpson said in a statement that the new funding gives the company "critical resources" for its business plan without diluting existing shareholders.

PDL, launched in 1986 as Protein Design Labs, licenses humanized antibody technologies to pharmaceutical and biotechnology companies in exchange for royalty payments, according to the company's website.

Avinger has raised a sizable amount of cash since its 2007 debut. Last July, the company closed a $33 million Series D round. Avinger nailed down a $22.5 million Series C round in January 2012 and pulled in another $25 million in 2011.

- read the release

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