Gets up to $50 million in new venture capital; will expand workforce
SANTA ROSA — Shortly after receiving a $50 million injection in venture capital, Santa Rosa-based medical technology developer Direct Flow Medical, Inc. has made significant strides toward U.S. approval to commercialize its transcatheter aortic valve replacement system, along with additional approvals in the European Union.
And as part of the ramp up to support a large pivotal clinical trial in the U.S., Direct Flow will embark on significant expansion, including doubling its workforce across the globe to more than 300, while seeking additional space in Santa Rosa to support research and development near its current 12,000-square-foot headquarters at 451 Aviation Blvd., according to CEO Bernard Lyons.
“We will nearly double in 2014,” Mr. Lyons said, adding that the company currently employs about 100 in Santa Rosa and 60 in Southern California and in Europe. He said a move into a large space could occur soon, though specific details are not yet available.
In January, the 10-year-old company simultaneously announced CE Mark Approval in the E.U. for what it describes as the “first fully repositionable” 29 millimeter transcatheter aortic heart valve, along with the completion of its first U.S. clinical trial that will enable it soon to commence a larger U.S. pivotal trial sometime this year. Direct Flow already had approval for 25-millimeter and 27-millimeter valves.
The advancements with its transcatheter aortic valve system, which is designed to reduce or nearly eliminate aortic regurgitation in patients who are often too frail for highly invasive open-heart surgery, came shortly after Reno-based PDL BioPharma, Inc. said it will provide an initial $35 million in funding, with the remaining $15 million to be funded upon the achievement of specific milestones.
“It really puts us on great financial footing for an expansion that we need, both in Europe and for the U.S. trial, which we hope to commence in the second quarter of this year,” Mr. Lyons said. “We are well capitalized.”
The recently completed clinical trial in the U.S. involved six sites across the country on 30 patients. Now, Direct Flow will focus on the pivotal trial, which will include 25 sites and some 500 patients, according to Mr. Lyons. The U.S. Food and Drug Administration is currently determining exactly when Direct Flow can begin the larger trial, which, upon completion, could mean FDA approval within a couple of years.
Direct Flow’s valve replacement system is not the only such transcatheter system, with both Irvine-based Edwards Life Sciences and Medtronic having achieved FDA approval for their valves. Each transcatheter aortic valve system is inserted through the femoral artery near the groin region and threaded up into the aortic valve, a far less invasive procedure than open-heart surgery for patients who suffer from aortic stenosis, a congenital condition where the opening of the aortic valve is narrowed, which then decreases blood flow from the heart to the rest of the body.
But Mr. Lyons said Direct Flow Medical’s system differs in several key respects, chiefly that it’s fully repositionable, whereas other valves are more difficult to adjust during implementation. If the valve is not placed precisely in the native annulus, blood leakage around the replacement aortic valve can lead to aortic regurgitation, which has been shown to increase mortality rates for patients. Additionally, because of its non-metallic design, Mr. Lyons said it is the lowest profile device in the market and is more flexible, which allows it to navigate challenging vascular anatomies that are common in such patients.
”The primary differences are that we can fully reposition (the valve) and it can be fully retrieved if a different valve size is warranted, and that allows us to optimize the clinical result prior to completing the procedure,” he said. By not using a metal stent as a frame as others do, and instead using a polymer valve with sealing rings, Mr. Lyons said its replacement valve systems “can virtually eliminate aortic regurgitation. The biggest clinical challenge in transcatheter aortic replacement is leakage around the stented valves, and that can lead to reduced survival for the patients and a higher mortality rate.”
During its discover CE Mark trial in Europe, Direct Flow reported a 96 percent survival rate on patients given the transcatheter aortic valve through six months. No patients experienced moderate or severe aortic regurgitation, according to the company. The system also demonstrated a strong safety profile, with a 97 percent safety rate, and there were no incidences of strokes — major or minor — or myocardial infarction between 30 days and six months.
“This new technology enables physicians to assess patient outcomes before final valve implantation, so they have the ability to further optimize valve placement through repositioning, if necessary,” said Direct Flow’s Chief Medical Officer, Charles Davidson.
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