Dive Brief:
- Zimmer Biomet expanded its deal with NeuroOne Medical Technologies to secure exclusive rights to the OneRF Ablation System for use in the brain.
- NeuroOne, which disclosed the deal Thursday, will receive $3 million upfront and potentially a $1 million sales milestone in return for an exclusive license to distribute its radiofrequency ablation system.
- The device is designed to identify and ablate the brain tissue that triggers seizure activity. The Food and Drug Administration cleared the device for use in the U.S. in December, and NeuroOne began a limited commercial launch in March.
Dive Insight:
Zimmer acquired exclusive global rights to distribute NeuroOne’s strip and grid cortical electrodes and electrode cable assembly products in July 2020. NeuroOne received $2 million upfront. Zimmer paid a further $3.5 million in August 2022.
NeuroOne recognized almost $1.5 million in collaboration revenue from the deal over the first nine months of its 2023 financial year but zero over the same period of 2024.
Expanding the deal to cover OneRF provides NeuroOne with another injection of cash and secures the support of a larger organization that may be able to grow sales of the device. NeuroOne reported around $826,000 in product revenue in the third quarter. OneRF accounted for around $163,000 of the sales.
The product consists of a radiofrequency generator and a stereoelectroencephalography (sEEG) probe. An implanted sEEG locates the area of ablation. After that, the sEEGs function as a probe for radiofrequency ablation. Creating radiofrequency lesions in nervous tissue may address the cause of epileptic seizures.
As of an earnings call in mid-August, NeuroOne had implanted 16 patients across four centers and performed more than 50 radiofrequency ablations on three patients. The company had begun the sales quotation process with an additional 12 centers. Zimmer could increase the resources available for the roll out.
NeuroOne ended June with $1.6 million in cash and cash equivalents. The company said the amount may not be sufficient to fund its operating expenses through at least 12 months. NeuroOne subsequently completed a $2.65 million private placement and entered into a $3 million secured credit facility.
The company expected the extra cash to fund operations through July 2025.
