Urotronic


Q3 Investment Report: Medical Alley’s Ecosystem Benefits from Growth in both Device and Digital Health

November 13, 2018 | Tags: , , , , , , ,

The year may be racing for the finish line, but Medical Alley early- and growth-stage companies won’t be eager to see it end. The first half of the year put 2018 close to the pace set by the record-breaking 2017 and the third quarter didn’t break stride. Companies based in Medical Alley raised $176,089,457 in Q3, the second best Q3 in the last five years, and keeping the region on pace to break a half-billion dollars in total money raised in 2018.

Biotech and digital health continued their strong years, but perhaps the most interesting insight that can be pulled from the data is that medical device – which had swooned a bit – seems to have returned to the forefront of investors’ minds.

Q3 Breakdown: From Strength to Strength

Q3 saw $176 million raised by 27 companies and the year-to-date reached $416M raised by 64 companies. While Q3 is down from a year ago, that is due in large part to fewer post-IPO raises in the quarter than there were in 2017. Removing those post-IPO numbers shows continuing strength in fundraising.

2017 had Bright Health’s massive raise of $160 million, an all-time Minnesota record. Comparing 2018 to 2017 without Bright Health shows the community’s great foundation and an expanding pool of Series A/B-type investments.

Device Investment Returns to Industry Capital, Medical Alley

Though the Medical Alley region has come to be known for its contributions across the healthcare spectrum, but there’s little doubt that medical device companies were integral in establishing the region as a healthcare hub. After decades of strong growth, the 2000’s dot-com bubble ushered in a lost decade for investment in technology, including medical devices, in Minnesota. Fortunately, investment in healthcare broadly has been on the rise since 2009, a trend that looks set to continue in 2018.

In the Q3 of 2018, Medical Alley device companies raised $90 million, pushing the total for the year to nearly $200 million raised by 33 companies. Q3’s largest raises in device included Urotronic ($26 million), 4C Medical ($17 million), and Cardialen ($17 million).

2017 was an especially strong year with multiple growth capital rounds raised in excess of $20 million. Looking over the five-year period from 2014 to 2018, nearly $1.5 billion has been raised by 118 device firms, $300 million more than the 2009-2013 period. With a quarter to go, the gap is likely to widen even more. Venture investing can be highly volatile quarter-to-quarter and thus we take greater interest in examining total investment over five- and ten-year periods to correspond with the lifecycles of many investment funds.

The $1.6 billion in device investment raised in the last five full years (2013-2017) makes Medical Alley not only the top region for medical device investment in the Midwest, but the top region for all healthcare investment in the Midwest, surpassing Ohio and Illinois by hundreds of millions of dollars.

Biotech Sets New Milestone in Medical Alley

Biotech continues its impressive run, breaking $100 million in capital raised in a year for the first time in Medical Alley history. $104 million has been raised through three quarters by 14 companies. Recombinetics had the largest Q3 raise with $34 million led by Gundersen Health System. This comes on the heels of a $7 million raise earlier this year, bringing their annual total to $41 million.

Recombinetics’ gene editing technology is making waves in the media, including coverage for their recent partnership with Medical Alley Association Foundational Member Mayo Clinic to grow human heart cells for eventual transplantation. They join fellow MAA member Miromatrix in leading the way toward a reduced need for long transplant waiting lists.

Drawing on the leadership of the University of Minnesota and Mayo Clinic, Medical Alley has a long history in biotechnology and pharmaceuticals. Leadership from companies like Upsher-Smith LLC, Bio-Techne and Be the Match is increasingly augmented by startups like Recombinetics, Stemonix, and Vyriad.

Digital Health Cements Position in Medical Alley

Digital Health investment continued its strong run with $32 million raised in the third quarter for a year-to-date total of $116 million. Taking into account the lower startup capital requirements compared to device or biotech, the quarter’s $32 million raise is a strong number.

Praestan Health ($12 million) and Learn to Live ($6.5 million) had large raises and represent a growing trend of investment in mental and behavioral health; in fact, no digital health company in Medical Alley bested Praestan’s $12 million raise. Medical Alley companies are making significant strides to eliminate the stigma around mental health and to create effective, novel solutions for mental illnesses.

Sansoro Health ($8 million) had the other major raise for the quarter. The demand for interoperability is driving solutions like Sansoro’s to the forefront of health innovation.

All Major Sectors in Medical Alley Break $100 million Raised for First Time

All three major sectors of the Medical Alley health innovation cluster broke $100 million in funding for the first time. Diversity is becoming a major strength of the cluster, insulating Medical Alley from the ups and downs of the finance world, and making it easier to attract top talent to the region. While historically Medical Alley was dependent on one sector – medical device, especially implantable and interventional devices – increasingly digital health and biotech are raising major growth rounds, seed rounds and everything in between.

With a balanced regional portfolio of growing companies, a year of strong exits, and still a quarter to go, Medical Alley is positioned to grow its leadership as the global epicenter of health innovation and care.


August 23, 2018: In The Know

August 22, 2018 | Tags: , , , , , , , , , , , ,

SPR Therapeutics’ new PNS system wins FDA nod

 

 

Medtronic testing defibrillator that uses wires outside the heart, veins

Mayo Clinic adding $11M birth center in Austin

 

 

Gene-editing firm Recombinetics raises $34M

 

 

Urotronic Closes $20M Series B Round of Financing

 

 

A New Spin on Centrifugal Technology

 

 

This New Health-Care Summit Aims to Join the Ranks of CES and SXSW

Online-care software company Zipnosis nabs $3 million

 

 

Global Kinetics Corporation hits significant clinical milestones on its trajectory to revolutionize the treatment of Parkinson’s disease

 

 

ValenTx raises $10.3 million for implantable gastric bypass device

 

 

CoreBiome Awarded Technology Commercialization Grant

Mayo Medical Laboratories, National Decision Support Company team up to develop CareSelect™ Blood, a comprehensive approach to patient blood management

 

 

Collagen Solutions inks distribution deals with two new Chinese partners

 

 

Mainstay Medical appoints new chief financial officer

Mark Fleischhacker, who helped build Minnesota’s med-tech industry, dies at 66


June 28, 2018: In The Know

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Abbott launches program to offset employee student loan debt

Prospect of China trade war sends chill through Minnesota med-tech

Bio-Techne buying ‘liquid biopsy’ firm Exosome for $250M+

Ecolab introduces tool to help reduce hospital infections

Tactile Medical Announces New Clinical Publication Demonstrating the Health and Economic Benefits of Flexitouch for Chronic Venous Insufficiency-related Lymphedema, Compared to Other Treatment Modalities

Chief medical officers at UnitedHealthcare, Blue Cross of MN have advice for med-tech companies

Space Suit Technology Helping Patients Walk Again 

Upsher-Smith Wins Silver Stevie® at 2018 American Business Awards®

Medtronic, Abbott push new diabetes monitoring systems

Raffaella Giardino Joins Microbiologics, Inc. as Executive Director, International Sales

Urotronic’s Innovative Optilume™ Drug-Coated Balloon Catheter Receives License For Urethral Stricture Treatments in Canada

 


April 26 2018: In The Know

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FDA approves Medtronic’s drug-coated balloon to treat long superficial femoral artery lesions

Ecolab Launches Cleanroom Portfolio in North America

HBR: How Mayo Clinic is combating information overload in critical-care units

Precision Therapeutics to acquire Helomics

Bio-Techne Announces New Leadership Appointment

 

 

 

Zipnosis adds post-surgical care services to telehealth platform

 

 

 

 

Michael Guyette Looks at the Big-Picture Business Landscape of Health Care

 

 

 

Sleep-apnea device maker Inspire Medical sets terms for IPO

 

 

 

 

Boston Scientific raises outlook after Q1 results top estimates

 

 

 

 

Urotronic gets OK for advanced trial to treat narrowed urethras

 

 

Anser Innovation Seeks Funds to Develop Medication Management Device

 

 

LABORIE Medical Technologies and Cogentix Medical Announce Completion of Acquisition of Cogentix Medical by LABORIE Medical Technologies

 

 

 

How Minnesota got a Pediatric Device Innovation Consortium

 

 


December 7, 2017: In the Know

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  1. Pairnomix And KCNQ2 Cure Alliance Report Findings From Comprehensive Drug Screening In A Cellular Model Of KCNQ2 Epileptic Encephalopathy
  2. 3M invests $26 million in the next generation of science and business talent
  3. Urotronic Conducting Clinical Trial for Device to Treat Urethral Blockages
  4. Treehouse Health Announces Investment and Partnership with PharmID
  5. 3D printed organ models are getting way better: Here’s how
  6. 4C Medical’s Novel Transcatheter Mitral Valve Technology Presented at ICI 2017 Technology Parade
  7. Mayo, Evelo Biosciences Ready ‘Microbial’ for Inflammatory Diseases
  8. Preceptis Medical Announces Series B Financing and Global Growth Strategy for China
  9.  VivaQuant Rhythm Express Software Demonstrates Improved Accuracy of Cardiac Safety Assessment Markers
  10. Cogentix Medical Announces Palmetto GBA Extends Medicare Coverage on Urgent® PC
  11. VigiLanz Integrates Infectious Disease Content from Sanford Guide
  12. HeartcoR Solutions Founder and CEO Larry Lawson to Receive 2018 Horatio Alger Award

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