Kips Bay Expects IPO to Net About $21M

The company, which filed for an initial public offering in April, wrote in a regulatory filing that it intends to offer 2.75 million shares of its common stock, priced between $8 and $10 per share.

Kips Bay Medical, Inc., a Plymouth-based medical technology company, on Tuesday outlined the terms of its proposed initial public offering (IPO) in documents filed with the U.S. Securities and Exchange Commission (SEC).

The company, which filed for an IPO in April, wrote in its preliminary prospectus that it intends to offer 2.75 million shares of its common stock, priced between $8 and $10 per share.

Assuming an IPO price of $9 per share, the company expects net proceeds to total roughly $21.2 million.

Kips Bay Medical has applied to list its stock on the NASDAQ Global Market under the symbol “KIPS.”

According to SEC filings, Kips Bay Medical is a development-stage company that is focused on manufacturing and commercializing a product called eSVS Mesh. The device is a mesh sleeve that is placed over a saphenous vein graft during coronary artery bypass surgery. It is designed to improve the structural characteristics and long-term performance of the vein graft.

The product was used in a 90-patient clinical trial, which resulted in approval of the product outside of the United States in May. The company has since marketed the product in some European markets and the United Arab Emirates, but has “not generated significant revenue from the sale of products to date,” according to SEC documents. The U.S. Food and Drug Administration is currently evaluating whether the product may begin clinical trials in the United States. The company said that it expects to enroll in a U.S. trial during the first half of 2011.

The company wrote in its SEC filing that it intends to use proceeds from its IPO to seek regulatory approval to market eSVS Mesh in the United States.

Kips Bay Medical incurred a net loss of $10.1 million in the nine months that ended on October 2-which included a $2.3 million charge related to a modification of an investor stock purchase option and a $5 million charge for a “first milestone payment” due to Medtronic, Inc., one year after the first commercial sale of the eSVS Mesh. Kips Bay Medical purchased intellectual property from Medtronic for the development of its device.

Kips Bay Medical was founded in 2007 by Manny Villafa–a, who has founded several other medical start-up companies, including Cardiac Pacemakers, St. Jude Medical, GV Medical, ATS Medical, and CABG Medical. He was named one of Twin Cities Business' “200 Minnesotans You Should Know” in April.

Minnesota's IPO activity has been slow lately, but 2010 saw two offerings-up from one in 2009 and none in 2008.