$10.5 Million for Providence Medical Technology

Providence Medical Technology, Inc. has announced the closing of $10.5 million in new equity financing for the company. The proceeds will be used to further commercialize and expand its portfolio of cervical-fusion technology. New investor MVM Life Science Partners (MVM) led the financing and will join the Providence Board of Directors. Stanmore Medical Investments, Aphelion Capital, and existing private investors also participated in the round.

Providence CEO Jeff Smith commented in the December 19, 2016 news release, “I am thrilled MVM is joining our group of supportive investors. MVM’s deep scientific expertise and success globally commercializing medical technologies make them an ideal partner for Providence.”

Smith commented to OTW, “We did not initially receive 510k clearance for one of our earlier implants. We then focused on commercializing in Europe and succeeded in getting a CE Mark for that first generation implant in 2011. The design of our implants evolved and we were able to get 510k clearance for our cervical cages and screw systems by 2013. All of our implants and instruments are now FDA cleared and CE Marked.”

“When I met [neurosurgeon] Bruce McCormack, M.D., I was his spine rep at Kyphon. I was promoted to the role of Manager, Sales Operations and managed the integration of St. Francis Medical Technologies (X-STOP) after Kyphon acquired that business. My last role at Kyphon prior to the Medtronic acquisition was building and leading a national salesforce for Kyphon’s spinal diagnostics business selling Discyphor (F.A.D.) which was a product Kyphon acquired from Dr. Todd Alamin at Stanford. It was during these roles working at Kyphon’s home office in Sunnyvale that I got to know Art Taylor who would become our chairman and early investor at Providence.”

“Providence is focused on developing cervical fusion products. We have developed a tissue sparing approach to posterior cervical fusion (PCF). Spine surgeons use our products in the following applications:

• foraminal stenosis in patients with cervical radiculopathy that have failed conservative case;
• as part of a circumferential fusion, in addition to an ACDF, for patients with advanced pathology and risk factors for non-union; patients with symptomatic non-union from ACDF or failed cervical TDR;
• patients with adjacent segment disease from previous cervical fusion.

Dr. McCormack told OTW, “Once the Medtronic acquisition went through in 2007, Jeff Smith was looking for more exciting opportunities than being a rep for a big strategic company. He approached me, in part because we had both attended Brown University. Jeff would hang out in the doctors’ office on Saturday mornings while I completed charts with the expectation that we would come up with an idea for a new company. After a month of Saturdays, we decided that posterior cervical fusion surgery needed innovation. The idea for Providence was born. Jeff quit his day job. We raised seed capital from friends and family. Biomechanical studies were done at the University of California San Francisco to validate some basic concepts. We next ran a clinical trial in the Philippines, which was successful. Our first attempts to get a 510k clearance were unsuccessful so we obtained a CE mark and did cases in Europe for several years. We altered the implant design and obtained a 510k clearance in 2013. We have been in the U.S. market for three years and are hitting our stride.”