Medtech Legend Manny Villafaña Opens $15M Funding Round for Medical 21
Medical 21, the latest project from medtech pioneer and St. Jude Medical founder Manny VillafaÃ±a, kicked off a new, $15 million funding round last Friday.
VillafaÃ±a’s Plymouth-based startup had a successful first funding round last year when it raised roughly $2 million. That capital, according to VillafaÃ±a, was exclusively used on animal tests for Medical 21’s flagship product, an artificial blood vessel that for decades been a pipe dream among medical professionals.
“People have tried for 40 or 50 years to do this and no one has done it,” VillafaÃ±a said in an interview with TCB.
For patients undergoing coronary bypass surgery—a procedure performed over 500,000 times each year in the U.S.—an artificial blood vessel could revolutionize the otherwise costly and painful procedure.
The surgery involves the bypassing of clogged arteries in the heart, which surgeons today accomplish by harvesting blood vessels from elsewhere in the body—typically a patient’s arms, chest or legs—and stitching into the heart to repair the circulatory system.
The side affects from losing those blood vessels, however, can be debilitating as patients often need to receive rehabilitation and, in some cases, re-learn to walk.
“We figure we can save $10,000 to $20,000 per patient, not to mention the pain and rehabilitation,” VillafaÃ±a said if Medical 21’s product turns successful. In all, VillafaÃ±a believes the creation of an artificial blood vessel could bring about potential savings of $4 billion to $8 billion a year in the U.S.
“It’s a pursuit that has to be done. We keep tearing up people’s arms and legs and costing their health care system enormous dollars,” he said. “So I’m going after the holy grail.”
That “holy grail” of cardiac surgery is in reference to creating a small-diameter graft, approximately 6 millimeters or less, that could work without fail in the human body. VillafaÃ±a claimed Medical 21’s product was already under this threshold, but declined to provide further detail.
Medical 21 technically marks VillafaÃ±a’s third go at creating an artificial blood vessel, although he touts it as his “first real attempt.”
In 2000, he founded CABG Medical Inc. The company, which raised $30 million from an initial public offering in 2004, developed a polymer-based tube that transferred blood from one side of the heart to the other. Clinical test results, however, weren’t favorable and CABG Medical ultimately shut down in 2006.
After that, in 2007, VillafaÃ±a established Kips Bay Medical. The startup made a mesh product out of nitinol wire that provided support to a patient’s saphenous vein graft in their leg during coronary artery bypass surgery. Kips Bay went on to raise $16 million during its 2011 IPO before shutting its doors four years later.
Yet, what gives VillafaÃ±a confidence in Medical 21, he said, is the new material his startup is using to create its man-made blood vessel. Developed by the University of Iowa and licensed to Medical 21, the material consists of cellulose graft conduits supported by a thin nitinol wire similar to what was used by Kips Bay. “Then we applied our own ideas and our own other materials to make a viable product,” VillafaÃ±a added.
Currently, Medical 21 is in the middle of animal testing its artificial blood vessel. But once those studies are complete, VillafaÃ±a expects Medical 21 will be out of money and unable to move onto human testing.
Hence the startup’s new $15 million funding round, VillafaÃ±a said. “What I’m doing now is a raise in which I’m inviting people to participate and put a down payment of 10 percent [of their total investment]. If my animal work is not successful—that is to say I don’t feel it’s suitable for human—then they get their money back. If it is good for human, then we’ll start using that money and ask for the other 90 percent.”
So far, Medical 21 has received $250,000 of its targeted amount, according to a recent SEC filing.
“I’m crazy to be doing this, but that’s the way I am,” VillafaÃ±a added. “I go after these things that people say cannot be done, but it won’t be done if someone doesn’t try it.”