Med tech IPO mania: 6 IPOs ready to raise $324M

At least a half-dozen med tech companies are ready for an IPO in the coming weeks. Already, they have either set IPO terms or have launched on to an IPO road show to sell investors. The three that have set rough IPO dates all have done so for the end of January.

These companies are set to test the durability of investor interest in med tech IPOs. Last quarter, there were IPOs from four medical device companies and one diagnostic player. But for 2013 and 2012, med tech IPOs were virtually nonexistent.

And most of these med techs are targeting a fundraising of roughly $50 million to $75 million--a territory much closer to the amounts raised by their biotech peers than the often smaller offerings from med techs. A few successful med tech IPOs from 2014 led the way. The most obvious example is the pain neuromodulation company Nevro ($NVRO), which priced its early November IPO at $18 and is trading at more than double--at close to $38.

The 6 med techs lined up for IPOs in the next few weeks are seeking to raise a total $324 million.

Med techs that have started on IPO road shows and/or set IPO terms
Company name Amount to be raised (millions) Estimated IPO date Description
Advanced Accelerator $75 TBD PET scan imaging tracers
Avinger $60 TBD Image-guided, catheter-based system to treat peripheral arterial disease
Check-Cap $13 TBD Ingestible imaging capsule for detecting colorectal cancer
Entellus Medical $70 Jan. 28 Minimally invasive treatment to open obstructed sinus pathways
Infraredx $56 Jan. 29 FDA-cleared optical catheter that identifies lipid core coronary plaques
Presbia $50 Week of Jan. 26 Surgically implanted lenses to correct age-related vision loss

The most ambitious among them is Advanced Accelerator Applications, which seeks to raise $75 million by selling 5.4 million American Depositary Shares (equal to two ordinary shares) at $13 to $15 per ADS. Existing investors including HBM Healthcare Investments have committed to buying to up $10 million of the IPO.

Advanced Accelerator produces molecular nuclear products for diagnostic and therapeutic uses. The company sells 6 diagnostic positron emission tomography, or PET, and single-photon emission computed tomography, or SPECT, products. During the first nine months of 2014, it had €50.2 million ($63.3 million) in sales. The company has a therapeutic candidate that's in pivotal trials for the treatment of mid-gut neuroendocrine tumors. It also has a lead diagnostic candidate, PET imaging agent Gluscan, to assess glucose metabolism.

Entellus Medical is similarly ambitious, hoping to raise $70 million by selling 4.4 million shares at $15 to $17 each. The company sells minimally invasive sinus balloons that can be used in a physician's office to treat chronic sinusitis.

The company had revenues of $34.4 million and a net loss of $5.7 million during the first nine months of 2014. Its investors include Essex Woodlands (26% pre-IPO stake), SV Life Sciences (23.9%), Split Rock Partners (21.1%) and Covidien Ventures (7.2%). Its existing shareholders have committed to buying up to $18.2 million of the IPO.

Avinger and Infraredx both have catheter-based cardiovascular technology. The former has a family of catheters and an imaging console that are enable physicians to penetrate arterial blockages known as a chronic total inclusion. Its latest device is Pantheris, an image-guided atherectomy device to treat peripheral arterial disease; the company expects a 510(k) submission during the second half of 2015.

The founder and executive chairman of Avinger, John Simpson, holds 22.5% of the company pre-IPO; other investors include Lucas Venture Group (11.6%), Black Diamond Ventures (6.9%) and Emergent Medical Partners (6.4%).

As for Infraredx, it hopes to raise $56 million by selling four million shares at $13 to $15 each. It has an FDA-approved optical catheter that uses near-infrared spectroscopy to determine if a patient has cholesterol-rich, lipid core coronary plaques; it also has intravascular ultrasound that shows the structure of the plaque. The system can identify so-called vulnerable plaques, which the company hopes to prove it can remove to effectively prevent coronary events.

Its backers include Sanderling Ventures (22.3%), Intrepid Maritime (14.3%), Eastwood Capital (14%) and Nipro (13.6%).

Finally, Presbia hopes to raise $50 million by selling 4.2 million shares at $11 to $13 each. An existing shareholder has committed to buying up to $5 million in the IPO. The company markets an optical lens implant to treat presbyopia, the age-related loss of the ability to focus on near objects. The implant is known as the microlens and can be used in conjunction with other optical surgical treatments such as Lasik. The microlens is currently in a pivotal trial and the financing would go to support that testing.

Editor's note: This article was updated to reflect the correct title for John Simpson.

Special Report: Infraredx- 2014 Fierce 15

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