Irish company Mainstay Medical, which has developed a device to address chronic lower back pain, has raised $108 million(€89 million) to commercialise it in the US market.
Mainstay, which is based in Dublin, secured approval from the US regulator – the Food and Drug Administration – in June to sell it Reactiv8 device in the US, the world's largest medical device market, to adult patients with chronic lower back pain who have failed to experience relief with other therapies and are not candidates for spine surgery.
The company has been strengthening its commercial team and organising additional financing since then. Chief executive Jason Hannon said the company planned a limited launch in the US by the end of the second quarter.
He said the scale of the financing and the calibre of investors in the round “is testament to the confidence in the commercial opportunity for Reactiv8”.
"We are now strongly capitalised to execute on our corporate objectives in 2021 and beyond, including the launch of Reactiv8 in the US market and acceleration of our commercialisation efforts in Europe and Australia. "
Reactiv8 is implanted in a surgical procedure and works by electrically stimulating nerves in muscles supporting the lower spine.
The company estimates that there are approximately two million people in the US and the EU who could be candidates for its device. It estimates the market for disabling chronic lower back pain in patients not suitable for surgery is worth approximately $30 billion (€25 billion).
The financing was co-led by European group Sofinnova Partners, which has been a long-term investors in Mainstay, and Ally Bridge Group, a healthcare investor with roots in China. Among its portfolio of investments is Chinese pharma group Wuxi Biologics, which has a plant in Dundalk.
Investors in the $108 million fundraising also include an unnamed "global medical device company" as well as Irish life sciences venture capital group Fountain Healthcare Partners, which was a founding investor in Mainstay, and KCK Group.
The company was listed on junior markets in Dublin and Paris but returned to private status last year.
"At $108 million it is one of, if not the largest ever, non-tranched venture capital deals in an Irish-based company," said Manus Rogan, managing partner and co-founder of Fountain.
Non-tranched means that Mainstay has access to the full amount from the outset.
“This large, over-subscribed round of investment represents a great validation of what the Mainstay team has achieved so far, and it exemplifies the conviction that we as investors have in our belief in this innovative device and the impact it will have on debilitating chronic lower back pain.”