SetPoint snags $27M from GSK, Covidien

SetPoint Medical's implant treats inflammatory diseases by stimulating the brain's vagus nerve.--Courtesy of SetPoint Medical

California startup SetPoint Medical has hauled in $27 million in venture funding to support its neuromodulation device to treat inflammatory diseases, attracting heavyweights like GlaxoSmithKline ($GSK), Covidien ($COV) and Boston Scientific ($BSX).

With the cash, SetPoint will fund the development of an implant that can stimulate the vagus nerve in the brain and trigger the body's natural inflammatory reflex, thereby treating ailments like rheumatoid arthritis and Crohn's disease.

Now, with such high-profile backers lending weight to the technology, the company has reached "an inflection point" in its work to find an alternative to immunosuppressive drugs, CEO Anthony Arnold said.

"SetPoint's therapy for inflammatory diseases is intended to benefit patients and caregivers by providing a more convenient and potentially safer alternative to drugs, while also significantly decreasing the cost for payers," Arnold said in a statement.

SetPoint Medical CEO Anthony Arnold

SetPoint is the first beneficiary of GSK's newly launched Action Potential Venture Capital, a Cambridge, MA-based fund laced with $50 million to find and support innovative medical technologies. The fund will finance between 5 and 7 companies in total, GSK said, looking for startups that complement its year-old bioelectronics R&D unit.

What made SetPoint stand out was the promise of its technology, GSK said. The company's system consists of an implantable miniature neuromodulation device, a wireless charger and an iPad app to monitor and control treatment. SetPoint's proprietary platform could become a viable alternative to pharmaceutical therapy, the company said, and, if its clinical development goes according to plan, neuromodulation could be a breakthrough treatment for inflammatory diseases.

In a first-in-human study unveiled last fall, SetPoint's device reduced the severity of rheumatoid arthritis in 6 of 8 patients who didn't respond to RA drug methotrexate, results the company said validate neuromodulation as a viable option for sufferers of inflammatory diseases including Crohn's, ulcerative colitis and psoriasis.

- read the announcement
- get more on GSK's new fund

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