Mainstay Medical has raised €30 million in funding through a placing of new shares in the business. The money will be used to drive the commecialisation of ReActiv8, a neurostimulator to treat chronic lower back pain, which won European approval last month.
Mainstay is also working on clinical trials to support an application for market approval in the United States.
Shares in the placing are being offered at €13, an 18.75 per cent discount to the closing price of the company’s stock Thursday. Mainstay floated in Paris and in Dublin in April 2014.
As part of the placing, investor KCK will join the company. KCK, a family investment group, is taking up half the shares in the placing, making it one of the largest shareholders in the company. As part of the exercise, KCK has secured the right to nominate two new directors to the board and has named Nael Karim Kassar, a director of KCK and Greg Garfield, a veteran medtech executive.
Long-term investors Sofinnova Partners and specialist Irish life science VC firm Fountain Healthcare Partners are also taking part in the placing. subscribing for roughly a quarter of the new stock between them.
Following completion of the placing, the new shares issued will represent roughly one-third of the total shares in the business.
ReActiv8 is an implantable device which works by sending electrical impulses to stimulate nerves working muscles critical to stability in the lower back area which may have been weakened by a previous injury.
The company is headquartered in Dublin and has subsidiaries in Australia and the United States.
Chief executive Peter Crosby said the fundraising would allow the business to progress its plans to commercialise the business in Europe and the United States "and help improve the lives of millions of people who suffer from chronic low back pain".
“We thank our existing investors for their continuing support, and we are proud to welcome KCK as the cornerstone investor for this fundraising, as well as several other new investors in Mainstay,” he said.
Mainstay is focusing its initial marketing drive in Germany, the company said.
