Lumbar spine surgery company TranS1 Inc. (NSDQ:TSON) priced a public offering of 6.2 million shares of common stock at $3.25 per share, expecting to raise up to $20.2 million.
TranS1 plans to use the funds for additional clinical trials, reimbursement efforts, sales personnel, research and product development activities and working capital, according to SEC filings. It added that funds may go toward acquisition of or investment in technologies, products or assets that complement the business.
Investment in TranS1 is a risky venture, the company reported. Although its spinal surgery products won FDA 510(k) clearance, long-term efficacy hasn’t been demonstrated through clinical trials.
Adding another layer of risk is that sales depend largely on third-party coverage and reimbursement. Reimbursement for TranS1’s products was complicated by a billing re-coding in 2009 which placed them in Category III alongside products often considered "experimental" or "investigational," according to SEC filings.
"This uncertainty around the availability and amount of reimbursement has caused some physicians to revert to other fusion surgeries where coverage and reimbursement are more certain," TranS1 wrote.
A billing code panel will review the categorization and consider bumping some of TranS1’s products to Category I in October.
The Wilmington, N.C.-based spine fusion company expects the offering to open Monday.
Here’s a roundup of other dealflow and investment news:
- Practice Fusion lands $6 million funding round
- Simpirica Spine closes $22 million in Series C
- Surgimatrix hopes for $500,000 equity round
- Fresenius notes offering get Ba2 rating from Moody’s
- UMass Amherst lands $20 million federal grant
- HealthTech Capital doles out $800,000 to two companies
- Teladoc lands $18.6 million funding round
- Sterionics and Biolectrics land LCCC Innovation Fund grants
- Non-Invasive Monitoring Systems announces $50K promissory note
- Mill Creek Life Sciences hopes for $1.5 million round
- Glucotec raises $8 million of a $10 million round
- BioBehavioral Diagnostics looks for another $2.4 million to close a $5.5 million round
- Medical Imaging & Technology Alliance lands $200,000 in federal funding