Medical device developer NeuroWave Systems is targeting a series A investment of up to $5 million to fund the European commercialization of its flagship anesthesia- and sedation-monitoring device.
Cleveland Heights, Ohio-based NeuroWave’s NeuroSense patient-monitoring device is aimed at reducing anesthesia complications. The company last year received the CE Mark and has already signed a European distributor for its brain-monitoring system. Now the company needs to step up sales and marketing of the system, and would use the series A round in part to fund an unspecified number of hires in those areas to support their distribution channels and partnership with CareFusion, CEO Tatjana Zikov said.
The NeuroSense monitor acquires and displays electroencephalogram (EEG) signals from both sides of the front part of the brain. Monitoring both sides of the brain is important for detecting neuropathologies, such as stroke, that can affect only one part of the brain. The idea behind the device is that it helps clinicians more accurately and safely tailor anesthetic drugs to a patient’s needs, according to Zikov.
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Zikov sees a market opportunity of $3 billion for the device, which would be used primarily in hospital operating rooms and intensive care units. Its main competition is Covidien’s BIS brain-monitoring technology, which Covidien obtained when it acquired Aspect Medical for $210 million in 2009.
NeuroWave is readying a next-generation version of its flagship NeuroSense device, which will feature a smaller monitor than the earlier version. The company is bringing manufacturing of the monitor in-house, figuring it can do so much more cheaply than importing the monitor from an outside Asian manufacturer, which it has been doing. That’ll allow NeuroWave to increase its profitability while it offers “competitive pricing” on the anesthesia-monitoring system, Zikov said.
Another key step for the company will be to obtain regulatory clearance to begin U.S. sales of the NeuroSense. NeuroWave would use a portion of the $5 million investment to fund a clinical study aimed at bolstering its 510(k) submission to the U.S. Food and Drug Administration. If all goes well, the device could be on the U.S. market by 2013, Zikov said.
The company is also hoping to begin Canadian sales by the end of the year, which is also when it’s targeting the close of its series A fundraising. NeuroWave has 10 full-time employees and also employs six part-timers and consultants, Zikov said.
NeuroWave has been around since 2003 as a division of Cleveland Medical Devices. In 2008, it was spun off as an independent company. It has raised about $12 million in nondilutive funding over its lifetime, primarily through grants from the National Institutes of Health.
