Microbot Medical Inc. (Nasdaq: MBOT), which is developing a miniature robot device for cleaning pipes and medical equipment, has announced a $10 million private placement. The financing round was at $2.70 per share, 29% below the price before the company's previous offering. The share price plunged 33% to $2.50 following the private placement, reflected a $98 million market cap.
Microbot was founded by chairman, president, and CEO Harel Gadot, who also manages the Medex medical devices incubator. Company general manager and COO Hezi Himelfarb, who manages the company's business in Israel, is the former CEO of Remon Medical Technologies, which was sold to Boston Scientific for $80 million.
Microbot is developing two main products. Its leading model is designed to clean artificial drainage pipes implanted in the body, for example in the urinary tract or the brain. These pipelines tend to become clogged, and must then be replaced in another operation. The miniature robot functions like the robot used to clean a swimming pool or a home. It is made out of titanium, and has arms that move around it. It can be controlled from outside the body and navigated within the pipeline to release concentrations of dirt, thereby enabling the dirt to be swept out of the pipeline.
In the future, the second product is also liable to prove suitable for cleaning plaque from blood vessels in order to prevent heart attacks and strokes, and to eliminate any future need for a balloon or stent. More remote applications could include a robot equipped with a camera for taking pictures inside the body (like Given Imaging's pill, but with the added capability of controlling its location and photography angle) and release of a drug in a specific location.
Share price plummets 80% since merger
Another Microbot technology includes a robot combined with balloons that can be inflated to create a hollow pipe between them. Surgical tools can be transferred through this pipe - catheterization wire, for example - without concern about damaging the sides of the artery. The company has completed animal trials for two products to date, meaning that it is at a relatively early stage. The company hopes to begin human trials next year.
According to Gadot, the financing round is designed to pay for the trials of the product and the acquisition of strategic assets to reinforce the company's product portfolio and its intellectual property.
Microbot was merged in August 2016 into Stem Cell, a company with little activity, in a deal in which Microbot received 95% of the shares in the merged company. In January 2017, the company raised $2.5 million in an offering at $5.50 a share, less than half the share's value at the time of the merger. The current $2.50 share price is 80% lower than the price at the time of the merger.
Published by Globes [online], Israel Business News - www.globes-online.com - on June 6, 2017
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