Dive Brief:
- Catheter Precision has agreed to merge with Ra Medical Systems, giving it access to public stock markets and additional cash to fund its work on cardiac electrophysiology devices.
- The merger comes months after Ra Medical, a company focused on laser radiation ablation, said it was considering a deal. Ra Medical has struggled commercially, generating product sales of $14,000 in the first half of the year to record a loss from operations of $14 million.
- Catheter Precision is closer to sustainability, recording a loss of $1.3 million on sales of $132,000 over the same period, but has lacked cash to invest in its cardiac electrophysiology portfolio.
Dive Insight:
Ra Medical went into 2022 focused on making a 510(k) filing for enhancements to its DABRA catheter, a laser endovascular treatment of vascular blockages, and securing clearance in a new indication. Yet, in July, having seen its share price fall 90% over the preceding year, the medtech company revealed plans to merge with Catheter Precision.
Those plans have now come to fruition. Under the terms of the reverse merger, the current Catheter Precision shareholders will own around 80% of the combined company. David Jenkins, the founder and CEO of Catheter Precision, will run the combined company.
Catheter Precision’s primary product is the VIVO System, a software based non-invasive imaging system that is designed to enhance the ability of cardiac electrophysiology specialists to diagnose and treat cardiac arrhythmias. The device is authorized for use in the U.S. and European Union. Catheter Precision used to market a remote catheter system, Amigo, that it plans to bring back in an updated form.
The company’s ability to pursue its plans has been constrained by its financial situation. At the end of last year, Catheter Precision had $12,000 in cash, leading its accountants to raise doubts about its ability to continue as a going concern. The company’s bank balance had increased to $76,000 by the end of June. Ra Medical ended June with $11.1 million in cash and equivalents.
The merger is expected to close before the end of 2022, subject to satisfying certain closing conditions.
