Success Breeds Success: How A $250M Acquisition Catalyzed Baltimore’s MedTech Ecosystem
November 12, 2019
One company gets absorbed into a larger brand and a host of companies flower as a result. The Biohealth Capital Region’s (BHCR) cycle of creative destruction has continued with Harpoon Medical. This was the story shared at the TEDCO Entrepreneur Expo’s session titled, “Success Breeds Success.”
In 2017, Harpoon Medical was acquired by industry giant Edwards Lifesciences Corporation for $250M, which included a $100M cash payment and $150M in milestone-driven payments over 10 years. Edwards Lifesciences acquired Harpoon, then an 18-person Baltimore, Maryland medical device company, for the minimally invasive, beating-heart repair technology for degenerative mitral regurgitation invented by Dr. James S. Gammie, now the Chief of Cardiac Surgery at the University of Maryland Medical Center.
For Harpoon’s founders Bill Niland and Dr. Gamme, and lead investor Epidarex Capital of Bethesda, Maryland, the Harpoon deal with Edwards Lifesciences was a remarkable, complex and hard-won agreement. While Harpoon Medical is now part of Edwards Lifesciences, the Baltimore company’s legacy is still reverberating throughout the BHCR.
Since the acquisition, serial entrepreneur Niland and Dr. Gamme have not stood pat; instead, they’ve played instrumental roles in a number of new BHCR companies, proving once again, like we have seen through Human Genome Sciences, Life Tech and MedImmune before it, that success breeds success.
AstraZeneca’s acquisition of MedImmune for $15.6B in 2007 was a landmark deal in the history of the region. The MedImmune brand has since been retired, but the company’s success gave birth to numerous BHCR companies that have contributed and still contribute to the region’s growing reputation as a global biohealth cluster. Former MedImmune employees went on to lead or found organizations like Sucampo Pharmaceuticals, MacroGenics, and Amplimmune, to name just a few.
Harpoon Medical’s legacy has a long way to go to match that of MedImmune. However, the company’s influential founders are already making a strong impact on the region.
Post Harpoon, Dr. Gammie has fostered a spirit of innovation within the Cardiac Surgery department of the University of Maryland Medical Center. Six Maryland companies, including NeoProgen and Breethe, a Maryland company focused on developing and commercializing the next generation of artificial lungs for hospital and home use, have been spun out of Dr. Gammie’s Cardiac department.
Following the sale of Harpoon, Niland, one of the most successful BHCR serial entrepreneurs, has gone on to start and advise new companies to help move a number of innovative technologies toward commercialization.
Niland is ReGelTech’s President and CEO. The Baltimore-based medical device company is developing the next generation of minimally invasive spinal implants for lower back pain and degenerative disc disease. The company closed on $2M in equity funding from TEDCO’s Maryland Venture Fund, the Abell Foundation and other angel investors in late 2018. The company anticipates starting its first clinical trial in 2020.
NeoProgen, also located in Baltimore, is a pre-clinical therapeutics company developing a cell therapy for patients that have had a heart attack. Niland, the company’s CEO, recently helped the company raise $1.5M in seed funding from the University of Maryland Momentum Fund, TEDCO and UM Ventures. NeoProgen anticipates that its first clinical trial will begin in 2020.
Dr. Sunjay Kaushal, M.D., Ph.D., Founder & Chief Medical Officer of NeoProgen is the Chief of Pediatric Cardiac Surgery at the University of Maryland Medical Center and works with Dr. Gammie, who is Chief of Cardiac Surgery at UMD and introduced Dr. Kaushal to Niland.
Sonavex, Inc. located in Baltimore, is focused on automated ultrasound solutions to quantify and visualize critical clinical data for surgeons who need reliable information on-demand. Niland is an investor and is currently on the company’s Board of Directors. Sonavex recently closed on a $3M tranche of funding and has raised $13M in funding since its inception. Following the rollout of its pilot program, the company will look to secure its Series B funding and scale up for a national product launch in the near future.
Niland is also on the Board of Directors of Baltimore’s CoapTech, a medical device company developing coative ultrasound technology. The company’s lead product is PUG (Percutaneous Ultrasound Gastrostomy), a point-of-care (as opposed to operating room) procedure for inserting gastrostomy tubes which can be quickly and easily performed by non-surgical providers. The enabling device for PUG is the company’s PUMA-G System. CoapTech was awarded a $1.2 Small Business Innovative Research (SBIR) Phase II grant from the National Institutes of Health (NIH) in October 2019; funding will be used by the company to conduct a 40-patient clinical trial.
The BHCR has a rich, storied history of successful companies being born from acquisitions that continues today. The companies supported by Harpoon’s acquisition and the continued entrepreneurship of Niland and Dr. Gammie are just the latest example of success breeding success. Viela Bio’s recent $150M IPO after being spun out of AstraZeneca is yet another example of MedImmune’s lasting legacy and the creative destruction that fuels the BHCR’s progress.
As new investors flock to the region, and larger, global life science companies search for their next deal, which Maryland-originated startup might get acquired next, creating a whole new generation of exciting, innovative companies in its wake?
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