Devax, a Lake Forest, Calif., maker of artery-opening stents, withdrew its filing for an IPO that the company estimated would raise $85 million. The company filed for its IPO in May, but until its withdrawal hadn’t filed any revisions to that preliminary document since.
The withdrawal is the latest bad news for stent makers. Big makers of the devices have been battered by a raft of sometimes contradictory studies that have nevertheless raised fears that stents might contribute to the formation of dangerous blood clots, and that they may be no more effective than drug therapy in the case of many blockages. Now the FDA is about to impose a more stringent testing regime for approval of new stents, which will likely push up development costs.
That’s particularly bad news for venture-backed stent makers, which had seemed to ride out the storm over stent safety fairly well over the past year. In February, for instance, XTent raised $76 million in an IPO, while in July CardioMind pulled in $33 million in a third venture round (our coverage here and here).
Other stent-related innovations, such as “bioresorbable” devices that dissolve weeks or months after they’ve propped open an artery and allowed it to heal, have also continued to pull in venture bucks. See, for instance, recent fundings for Reva Medical ($42 million — our coverage) and Arterial Remodeling Technologies ($7.8 million — our coverage). TriReme Medical, which — like Devax — is developing stents designed specifically for blockages in arterial junctions, also just raised $16 million (see here).
Public investors may be feeling less generous, though, if the Devax experience is anything to go by. That said, Devax also seems oddly secretive for a company that had actually hoped to go public. Its Web site is a bare-bones affair that offers nothing but contact information, and its IPO-withdrawal letter doesn’t even include the obligatory fig leaf that blames “market conditions” for its failure to get out the gate. At least the company’s first SEC filing is informative. (We didn’t manage to cover it at the time, but we’ll have an eye on them going forward.)