Shares of Neuronetics have begun trading on the Nasdaq, following a $93.5 million IPO this week, which priced 5.5 million shares of common stock at $17 each, under the ticker symbol STIM. As of Friday morning, shares were up 63% to $27.78.
Founded in 2003, the commercial-stage company manufactures an in-office device that magnetically stimulates the brain to treat major depressive disorder. Its NeuroStar Advanced Therapy System was cleared by the FDA in 2008 and received a CE Mark in 2012.
Based in Malvern, Pennsylvania, Neuronetics has previously been backed by the investment arms of GE and Pfizer, among several other firms, across eight venture capital financing rounds in the past years.
The company plans to use the IPO proceeds to further commercialize and fund research into its device. In its prospectus, Neuronetics cited 781 device systems installed in about 615 psychiatrist offices, and estimated 50,000 patients treated in over 1.8 million sessions. The company posted $40.4 million in revenues for the 2017 calendar year and $10.2 million in the first quarter of this year.
A 2016 study by the company found that its system could offer a long-term alternative to drugs for depression. The pilot feasibility study observed that some nonmedicated patients responded to transcranial magnetic stimulation, and sustained responses with a monthly maintenance procedure.
There was no statistically significant difference in any outcome measure, and only 16 patients completed the full study, but the monthly treatment group did see longer times before intensive therapy needed to be introduced, and were less likely to need reintroduction of TMS.
Last fall, the FDA granted 510(k) clearance to a similar, competing device from Nexstim, its Navigated Brain Therapy System, for patients with MDD who did not see improvements from prior antidepressant medication.
According to Nexstim, navigation system allows for accurate, reproducible stimulation of specific areas of the brain over repeated sessions. The Helsinki-based company began marketing and sales of its system in the U.S. earlier this year.