Underwriters: Morgan Stanley, JPMorgan, Thomas Weisel, Leerink Swann & Company
Maximum Offering: $86.25 million
We develop and manufacture a new generation of medical robotics designed for accurate positioning, manipulation and stable control of catheters and catheter-based technologies. Our Senseitm Robotic Catheter System, or Sensei system, is designed to allow physicians to instinctively navigate catheters with greater stability and control in interventional procedures. We believe our Sensei system, and its corresponding disposable Artisantm Control Catheter, or Artisan control catheter, will enable physicians to perform procedures that historically have been too difficult or time consuming to accomplish routinely with existing catheters and catheter-based technologies, or that we believe could be accomplished only by the most skilled physicians.
We believe that our Sensei system will benefit patients, physicians, hospitals and third-party payors by improving clinical outcomes, permitting more complex procedures to be performed interventionally and by reducing treatment times. We expect to begin commercial shipments of our Sensei system and disposable Artisan control catheters in Europe in 2006 and in the United States in 2007, subject to receiving required regulatory clearances. In the United States, we are currently seeking clearance from the U.S. Food and Drug Administration, or FDA, for the use of our Sensei system and Artisan control catheters to guide catheters for mapping the heart anatomy.
Financial Highlights:The pre-revenue company has spent $45 million in operating expenses since it was founded in September 2002. First half 2005 and 2006 expenses were both around the $11.5 million mark, with G&A growing at the expense of R&D in the period. At the end of June, the company had $25 million of cash in the bank, and $4 million of long-term debt. Revenue is projected for the end of 2006 at the earliest.
Competition: There is no clear head-on competitor; the company lists Johnson & Johnson (JNJ), Boston Scientific (BSX) and St. Jude Medical (STJ) as potential competitors.
Use of Proceeds: The funding is targeted for corporate growth, including $18 million for SMG&A, $10 million for product development and R&D, and $8 million for capital equipment and tenant improvement.
Management: Frederic Moll is the CEO:
Frederic H. Moll, M.D. is a Co-Founder of Hansen Medical and has served as our Chief Executive Officer and a Director since our inception in September 2002. In November 1995, Dr. Moll co-founded Intuitive Surgical Inc., a medical device company, and served as its first Chief Executive Officer and later, its Vice President and Medical Director until September 2003. In 1989, Dr. Moll co-founded Origin Medsystems, Inc., a medical device company, which later became an operating company within Guidant Corporation, a medical device company, following its acquisition by Eli Lily in 1992. Dr. Moll served as Medical Director of Guidant’s surgical device division until November 1995. Dr. Moll holds a B.A. from the University of California, Berkeley, an M.S. from Stanford University and an M.D. from the University of Washington School of Medicine.
Ownership: Five venture investors hold the bulk of the company, with Prospect Partners holding the largest share (22.63%). The largest individual shareholder is the CEO, with 12.37%.
Regulatory Risk: The company has not received regulatory approval from the USA or internationally. Note from the S-1:
We are currently seeking 510(k) clearance for our Sensei system solely for use with two specified mapping catheters to map the heart anatomy. We submitted our application in December 2003, which the FDA denied in February 2005. We subsequently submitted a revised application in September 2005. In response to deficiencies identified by the FDA, we made two subsequent submissions in support of this application. The first submission in March 2006 was deemed inadequate; the second submission in June 2006 is pending. None of our 510(k) submissions to date have presented significant clinical data to the FDA. We cannot assure you that the FDA will clear our Sensei system for mapping the heart anatomy on the basis of our pending 510(k) submission, or that the FDA will not require us to gather significant clinical data to support 510(k) clearance. The FDA also could deny our 510(k) clearance and require our Sensei system to undergo the more burdensome premarket approval, or PMA, process, which would require significant clinical trial data and generally takes from one to three years to complete. Even if our Sensei system is cleared for mapping procedures, we cannot assure you that FDA will not place restrictions on our cleared labeling, including contraindications or warnings against the use of our Sensei system in ablation procedures.