Personal bionics maker BiOM may eventually take its case to the public markets, eyeing a potential initial public offering, according to a report in the Boston Business Journal.
BiOM CEO Dr. Charles Carignan told the paper that the company is mulling an IPO but that it would not happen until at least 2016.
The Bedford, Mass.-based BiOM (formerly known as iWalk) recently revealed that it had raised $6 million though a debt and equity financing round in a Dec. 23rd filing. The company is looking to raise up to $10 million in this round. In total, BiOM has raised $48 million since its inception in 2006, according to the BBJ.
The most recent round included existing investors Sigma Prime and General Catalyst, as well as Gilde Partners, Carignan told the paper. In addition, an unnamed "non-U.S. purchaser." which invested a total of $1,079,160 into the bionics prosthetics maker was listed on the SEC filing.
Carignan added that the company would look to grow its 45 employee base by 15 and would release newer versions of its flagship device in the next year.
Should BiOM choose to file for an IPO, the company would join a growing number of medtech firms taking advantage of the suddenly frothy public markets. In 2014, more than 25 medtech companies filed initial public offerings, according to a MassDevice.comanalysis.
BiOM is a driving force in the bionics revolution. The company’s BiOM T2 bionic ankles are part of a new generation of "smart" prosthetics that seek to restore normalized function of human limbs to amputees. The company’s bionic ankle emulates the muscle function of a human ankle using computer processors that are able to "adjust the ankle’s stiffness and propulsive torque 500 times a second," the company says. The result is a prosthetic that can mimic a person’s natural gait, reducing many of the long-term health problems associated with prosthetic limbs. The company was founded by MIT robotics guru Hugh Herr.
The BiOM is one of the costlier prosthetics on the market – up until January of this year insurance companies reimbursed physicians anywhere from $50,000 to $150,000 for the devices, according to BiOM. Although the device is covered by the U.S. Defense Dept., the Veterans Affairs Dept. and various private worker’s compensation plans, the device remains in reimbursement limbo at the Centers for Medicare & Medicaid Services.
Former BiOM CEO Tim McCarthy told MassDevice.com that even though CMS issued a specific reimbursement code for the BiOM prosthesis and set a reimbursement rate, it ultimately determined that Medicare would not cover the device.
"Even though they’ve given us the code, given us the fee, it’s a non-Medicare covered item, so any Medicare covered patient who wants the BiOM would either have to get supplemental insurance or pay out of pocket. Medicare is not paying for the BiOM at this stage," McCarthy told us. "They didn’t do us any favors."
BIOM has put more than 1,000 systems on the market, about half to military personnel who lost limbs in combat. The company has always had a strong connection to the VA and the Defense Dept.; BIOM was partially funded by the federal government, part of a $500 million push to create better prosthetics. BIOM is the only commercialized technology to spin out of that investment, McCarthy told us.
In July, BiOM replaced McCarthy with Carignan, a 20-year medtech veteran who has held several key positions in the medical device industry, including most recently at NinePoint Medical, where he was the founder and CEO.
In addition, Carignan has served as executive vice president and chief medical officer of Novasys Medical and held the same role at Boston Scientific (NYSE:BSX). He was also the vice president of clinical research and medical affairs at Conceptus (NSDQ:CPTS), where he oversaw the clinical development of the Essure device for female sterilization.