By Mary Vanac
Checkpoint Surgical Inc. raised an additional $250,000 from angel investor group Medical Growth Fund to build a sales force and distribution network for its disposable surgical device.
The Checkpoint Stimulator/Locator is “used to stimulate motor nerves during surgery to help the surgeon identify where the nerve is and what tissue is or is not a nerve,” president and CEO Len Cosentino said.
“It’s also used to evaluate the health of the nerve,” Cosentino said. “Our initial target market is orthopedics,” adding that his company’s hand-held device could be used in shoulder revision or nerve transfer surgeries.
Late last year, Checkpoint Surgical raised $1.1 million from JumpStart Inc., a venture capital fund in northeast Ohio, and from private investors and company managers, to complete development and commercialization of its device. Earlier this year, the company used some of that money to test the Cleveland, New York City and Philadelphia hospital and surgical center markets for product sales.
“That has gone well. The device has been received very well by surgeons,” Cosentino said. “Now we are ready to expand our pilot. We are now embarking on an effort to contract with independent distributors across the U.S. and sell the product nationwide.”
Checkpoint recently hired a vice president of sales, Stephen Jacobs, to lead the sales expansion. In addition to Cosentino and Jacobs, the company employs Kevin Scanlan as director of training and education and Terri Zmina as director of operations.
Dr. Michael Hausman, Robert K. Lippmann Professor of Orthopedics at the Mount Sinai School of Medicine and vice chairman and chief of Hand and Elbow Surgery in Mount Sinai’s Department of Orthopedics, is its chief medical advisor.
The company is nearing the completion of its first financing round, initially pegged at about $2 million, Cosentino said.
“We’re almost there. Then we will look to raise money again at the end of this year,” he said, adding that the economic downturn made fundraising difficult but not impossible.
“The environment is clearly one of the most challenging I’ve seen in my experience,” Cosentino said. “While it hasn’t been easy, we’ve been pleased with the success we’ve had on the fund-raising side. The key for us now is to grow our sales.”
Last week, Cleveland’s Imalux Corp. announced a $250,000 investment from the Medical Growth Fund, an emerging angel investor group supported by Northeast Ohio bioscience company developer BioEnterprise. Imalux is engineering the second generation of its Niris Imaging System, which uses near-infrared light to produce high-resolution images of tissues in the human body.
Founders of the fund read like a Who’s Who list of medical technology entrepreneurs in Northeast Ohio: Ray Dalton, founder and chief executive of medical equipment supplier PartsSource is the fund’s chairman. Others include Imalux CEO Michael Burke and chairman Bill Sanford, Chuck Hallberg (MemberHealth), Jim Hummer (Whole Health Management), Colin Scully (Life Line Screening), and Geoff Thrope (NDI Medical).
NDI Medical, which incubates neuromodulation devices, spun out Checkpoint Surgical in mid-2009. Thrope, who is NDI’s president and chief executive, is a director for Checkpoint.