MASSDEVICE ON CALL — The Mass. Life Sciences Center, a quasi-public agency that oversees state dollars allocated toward increasing the life sciences industry’s footprint in the Bay State, doled out another $3.8 million in “accelerator” loans.
The program is designed to provide a boost to early-stage life science companies that the center’s scientific advisory board deems to have a high potential for commercialization, rapid growth and the ability to raise substantial capital.
In two previous rounds, loans went to 10 companies. In September 2010, Good Start Genetics became the first company to repay their accelerator loan after raising $18 million in a Series A financing round.
In the spring of 2009, the center handed out about $2.5 million worth of loans to seven Massachusetts companies.
The program was put on hold in the fall of 2009, when the Commonwealth’s budget crisis put the center’s discretionary funding pool in jeopardy. The agency manages four pools of grants, loans and tax breaks designed to attract companies and grow start-ups in Massachusetts.
The current round upped its cap from $500,000 to $750,000, tapping a pool worth about $5.5 million.
The five companies set to receive the loans in this round are:
- MoMelan Technologies (Cambridge): MoMelan is developing an "Epidermal Expansion System," a point-of-care, desktop medical device designed to allow dermatologists and wound care specialists to perform standardized epidermal skin grafting.
- Myomo Inc. (Cambridge): Myomo is developing a comprehensive rehabilitation system combining robotics, software and specialized treatment protocols for stroke patients.
- Grove Instruments Inc. (Worcester): Grove is developing a painless, noninvasive light-based technology to measure blood sugar at the point of care.
- ECI Biotech Inc. (Worcester): ECI makes ExpressDetect diagnostic sensors that use genomics and a high throughput screen for broad-spectrum and specific sensors for bacterial and fungal infections.
- AesRx Inc. (Newton): AesRx is developing drugs to treat sickle cell disease and other dieseas, including Aes-103, a novel, orally bioavailable, small molecule (Da 126) therapeutic for the treatment of SCD.
Celera shareholders sue over $344 million Quest Diagnostics buyout
Shareholders of Celera Corp. (NSDQ:CRA) are suing over Quest Diagnostics Inc.’s (NYSE:DGX) $8-per-share bid for the genetic diagnostics firm, alleging that Celera’s directors are selling the company for less than it’s worth — and less than the current stock price — to forestall a scandal of the restatement of some of the company’s financial results.
The lawsuit, filed by the New Orleans Employees’ Retirement System yesterday in the Delaware Chancery Court, cites the re-classification of bad debt expenses and the recognition of uncollectible charges and accounting methods in Celera’s March 18 earnings report.
"The board utterly failed to advance the interests of Celera’s stockholders," according to the lawsuit.
CRA stock has traded above $8 per share since the merger was announced last week. That’s "strong evidence that the Celera board failed to maximize value," according to the complaint. The stock hovered between $5.57 and $7.71 in the year running up to the Quest offer.
The Madison, N.J.-based diagnostics giant’s bid for Alameda, Calif.-based Celera sent Celera’s stock up nearly 30 percent by mid-day March 18.
Angiotech asks U.S. court to approve bankruptcy plan
Angiotech Pharmaceuticals Inc. (OTC:ANPI) asked the Delaware Chancery Court to approve its plan to eliminate $250 million in debt and wipe out the company’s existing shareholders, apart from a group connected with its 2006 acquisition of Quill Medical Inc.
The Supreme Court of British Columbia has already accepted the “plan of compromise” between bankrupt Angiotech and its creditors. The deal also calls for holders of some of Angiotech’s debt to receive stock in exchange for their notes. The company also lined up a $25 million line of credit with Wells Fargo Capital Finance LLC to continue operations during the bankruptcy period.
Angiotech hitched its wagon to Boston Scientific Corp. (NYSE:BSX) and its Taxus drug-eluting stent, but Taxus sales have plunged in recent years as competitors’ more-recent DES models, such as Abbott Laboratories’ (NYSE:ABT) Xience V, have gained market share. Angiotech’s royalties from sales of the Taxus stent (for which Angiotech makes the paclitaxel coating) were down 56 percent during the third quarter.
The bankruptcy plan also contains $6 million to settle a lawsuit filed by a group representing former shareholders of Angiotech acquisition Quill Medical Inc., filed last October.
NeuroMetrix wins appeal of shareholder lawsuit
The U.S. Appeals Court for the 1st Circuit handed NeuroMetrix Inc. (NSDQ:NURO) a win in a lawsuit filed by shareholders alleging that the company and its management team misled investors in quarterly regulatory filings and in conference calls with analysts discussing quarterly results.
The lawsuit accuses NeuroMetrix and some of its managers of deliberately withholding or concealing the possibilities that insurance companies would deny or lower reimbursement for procedures using its NC-Stat, a non-invasive device that measures nerve conduction.
The U.S. District Court for Massachusetts dismissed the case in December 2009. NeuroMetrix then moved to settle it, offering to pay for the plaintiff’s legal fees and institute a series of safeguards to prevent similar foofaraws in the future. The plaintiffs declined that offer and appealed to the First Circuit.
Battelle Memorial Institute wins $7.8 million military contract
Battelle Memorial Institute won a $7.8 million contract with the U.S. Defense Dept. to research the best way to protect the Pentagon from a large-scale attack.
The Columbus, Ohio-based institute was founded at the bequest of Gordon Battelle more than 80 years ago. A charitable trust, it operates on the founding principle of transferring technology through commercialization.
The contract calls for Batelle to research "the development of a coordinated response to potential chemical, biological, radiological, nuclear or high-yield explosive (CBRNE) threats," according to the Defense Dept. "The results of this effort will provide Washington Headquarters Services, Facilities Support Directorate, with an analysis of requisite information that will be utilized in the development of CBRNE emergency preparedness standard operating procedures and continuity of operations to execute its mission and meet the requirement to protect and safeguard the occupants, visitors, and infrastructure of the Pentagon facilities."
Analyst: Health care reform likely to go down
An analyst for Leerink Swann thinks the Patient Protection and Affordable Care Act is unlikely to surmount the many challenges it faces, counseling investors to buy stocks poised to benefit from its downfall.
John Sullivan, in a research note to investors, wrote that opponents to the health care law in Congress, the states and the courts are gaining ground as the expected "political goodwill" from the law has failed to materialize for Democrats.
"At the time of the bill’s signing, Democrats projected that political cover would be gained in 20011-12 from public gratitude for the early benefits of healthcare reform, but it hasn’t happened. Increasingly nervous that the White House is at risk in 2012, Democratic leaders are backpedaling from healthcare reform," Sullivan wrote. "We expect the rest of 2011 to carry an anti-healthcare reform tone, benefiting stocks in the managed care and medical device subsectors. If 2011 or 2012 brings the law to a set aside or unwound status, significant curbs on managed care’s commercial practices and profitability would be removed."
Companies that could benefit this year include Baxter International Inc. (NYSE:BAX), Illumina Inc. (NSDQ:ILMN), Hologic Inc. (NSDQ:HOLX), Amgen Inc. (NSDQ:AMGN), InterMune Inc. (NSDQ:ITMN), BioMarin Pharmaceutical Inc. (NSDQ:BMRN), Coventry Health Care Inc. (NYSE:CVH) and Cerner Corp. (NSDQ:CERN), according to Sullivan.