EnteroMedics (NSDQ:ETRM) said today it closed the 3rd tranche in a $25 million offering of Senior Amoritizing Convertible Notes, bringing in $6.3 million for the company.
The original securities offering consisted of 3 tranches, but has been amended to allow for a 4th tranche of $6.25 million which must be drawn or waived by August 15, the St. Paul, Minn.-based company said.
“Drawing of the 3rd tranche of this offering provides the company with added flexibility as we execute on a focused, direct-to-patient marketing strategy and work toward reimbursement and coverage goals that will further drive the commercial potential of vBloc Therapy. By amending the agreement to provide for four funding tranches, we are also better able to align our capital needs with our issuance of additional shares,” CFO Greg Lea said in prepared remarks.
Funds from the round will be used to support the continued commercialization of its Maestro Rechargeable weight loss system, as well as for working capital and general corporate purposes, the company said.
Northland Securities acted as placement agent for the offering, the company said.
Yesterday, EnteroMedics said it signed a distribution deal for its Maestro weight-loss device with Academy Medical, an orthopedic implant and wound care supplier to the U.S. Veterans Affairs Dept. and the U.S. Defense Dept.
The Maestro device is an implantable neurostimulation device designed to intermittently block the vagus nerves using high-frequency, low-energy impulses. The therapy, which St. Paul, Minn.-based EnteroMedics calls “vBloc,” is approved in the U.S., Europe and Australia to aid in weight loss in obese adults with a body mass index of 40 to 45 or a related health condition and a BMI of 35 to 39.9.
