Dermatology co Foamix mulls Nasdaq IPO
Arineta's cooperation agreement with GE Healthcare, to market the product when it is completed, comes into effect with the financing.
Sources inform ''Globes'' that cardiac CT developer Arineta Ltd. has raised $10 million from Israeli and foreign private investors. The proceeds should enable the company to complete development of its product: a proprietary CT scanner for cardiology.
The securing of the financing means that Arineta's cooperation agreement with GE Healthcare, which will market the product when it is completed, comes into effect. The financing should be sufficient for most of the development process, but Arineta will probably need additional financing for the pivotal trials. The company hopes to bring its product to market in 2014.
Arineta CEO and R&D manager Dr. Ehud Dafni confirmed that the company had raised the capital, but declined to confirm the amount. Dafni was once a lead engineer for CT development at Elscint. He co-founded Arineta with Yosi Morik, a serial entrepreneur in the life sciences who sold Advanced Stent Technologies Inc. to Boston Scientific Inc. (NYSE: BSX) for hundreds of millions of dollars. He was an investor in Medcon, which was sold to McKesson Corporation (NYSE: MCK) for $105 million, and he is currently a director in Rcadia Medical Imaging Ltd. and Expanding Orthopedics Ltd.
Arineta's cooperation agreement with GE Healthcare for a product that does not exist was intended to demonstrate to investors to provide the capital needed to complete the product development, by removing the risk of finding a distributor. This model of collaborating with large companies at a very early stage and customizing the product to meet their needs and with their support is becoming increasing popular. It has become necessary as the time from product concept to sales has lengthened and become more expensive, increasing uncertainties about the very costly marketing stage.
There is demand for specialized CT scanners for particular organs, given the high cost of full-body CT scanners, their high radiation levels, and the infrastructure needed to build a special room and maintain them.
"Our device offers patients cardiovascular diagnostics at a much earlier stage and lower cost," says Dafni. "The product is based on proprietary technology developed by Arineta for which we have 18 patents, six of which have already been approved, including a critical patent on the unique structure of our scanner."
"The uniqueness of our scanner is that it can quickly image the entire cardiac space in a single 3D image. Thanks to this speed, the heart can be imaged at a moment in time, whereas the images of other scanners are affected by the heart's movement. Those devices need to take several images to obtain a 3D image, a process that reduces the quality of the image."
CT cardiac scanning is an alternative to catheterization for diagnostics. Dafni says that 7-8 million diagnostic catheterizations are currently carried out annually, and that Arineta's device will lower costs. "Our device will be smaller and cheaper, with lower radiation," he says, and points to a link between his company's activity and the emphasis on diagnostic information that the US healthcare system, prodded by the Obama administration, is seeking - to obtain more accurate diagnostics as a way to eliminate unnecessary tests.
Published by Globes [online], Israel business news - www.globes-online.com - on November 17, 2011
© Copyright of Globes Publisher Itonut (1983) Ltd. 2011
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