A $500,000 loan from the state of Ohio will help AxioMed Spinemanufacture and launch the company’s second product, an artificial cervical spine disc.
The company will use the loan to purchase machinery and equipment to manufacture the discs at its plant in Garfield Heights, Ohio, also the site of its corporate headquarters, CFO Jerry Baty said.
“It provides some very important financing for us to expand into this second product line, which will have a big impact on our ultimate value,” Baty said.
The loan was recommended by a group associated with the Ohio Department of Development and is pending approval from the State Controlling Board.
AxioMed hopes to obtain European regulatory clearance, called the CE Mark, to commercialize its cervical spine disc later this year. In 2009, AxioMed received the CE Mark for its first product, a lumbar, or lower spine, disc replacement.
The lumbar replacement is roughly two years away from U.S. regulatory review. AxioMed has enrolled about 300 of 350 patients for a pivotal study on the device. Baty expects the company will complete enrollment next quarter.
Then researchers will follow the patients for two years to collect data for a Premarket Approval (PMA) Application to the U.S. Food and Drug Administration. If approved, the PMA would give AxioMed the right to sell its lumbar replacement discs in the U.S.
AxioMed has raised $56 million in financing since its 2001 inception, Baty said. The company’s backers include CID Equity Partners, Early Stage Partners, Investor Growth Capital Limited, Primus Capital,Memphis Biomed Ventures, Reservoir Venture Partners and Thomas, McNerney & Partners.
The company also received a $750,000 Innovation Ohio Loan from the state’s Third Frontier Project in late 2007 to help expand (pdf) its Garfield Heights testing and manufacturing floor.