Massachusetts-based Zoll Medical ($ZOLL) is snatching up CoAxia, a venture-backed Minnesota devicemaker that has had trouble getting a broader FDA approval for its signature technology.
Neither side is disclosing the financial details. But Mass High Tech/Boston Business Journal reports that CoAxia, which has pulled in $70 million in venture capital over the years, netted a "small" price. That may be, but it is a targeted acquisition with long-term growth plans in mind.
CoAxia's NeuroFlo and Flo Control cathethers are designed to redistribute blood flow from the lower extremities to help support brain function during ischemia. NeuroFlo has an FDA Humanitarian Device Exemption to treat patients with a vasospasm following a subarachnoid hemorrhage, and FloControl is 510(k) cleared to stop and control blood flow in the peripheral vasculature.
But here's the thing. CoAxia tried to get NeuroFlo approved for use in ischemic stroke. But the company's pivotal SENTIS trial didn't achieve statistical significance in its primary efficacy end point (it met the primary safety endpoint). In short, the FDA hasn't granted NeuroFlo approval for the stroke indication it has long wanted. Clearly, Zoll has confidence it can overcome any problems CoAxia has faced with the FDA. The company said in its deal announcement that it will conduct a follow-up clinical trial to SENTIS "in the near future." And Zoll also emphasized that it will work with "leading stroke centers" and the FDA to "identify the next steps" to move the process forward.
Assuming Zoll can overcome CoAxia's FDA challenges, the deal actually makes sense on the surface. As Zoll itself points out, there is potential synergy at play here. One of Zoll's sweet spots involves intravascular temperature management devices (using balloon catheters), and the company said it is studying the use of its technology to treat ischemic stroke patients. As well, the deal announcement is yet another example of Zoll's pursuit of its own growth and expansion initiatives in the months since Japan's Asahi Kasei grabbed it for $2.2 billion.
"Our task is to continue to develop the significant body of clinical evidence started by CoAxia demonstrating the safety and efficacy of the NeuroFlo catheter, and, in the end, do what is necessary for it to be a standard treatment option for hundreds of thousands of stroke patients worldwide," Zoll president James Palazzolo said in a statement.
- read the release
- here's MHT/BBJ's take