Surgical devices maker Cardica (CRDC) has reached the first milestone for its Microcutter product line under its distribution pact with Century Medical, a leading supplier of medical equipment in Japan. The Microcutter line of novel endoscopic stapling devices is geared for use in a variety of surgeries that require cutting and stapling.
The agreement, which was inked recently, provides Century Medical with exclusive rights to distribute the Microcutter products in Japan. In exchange for the distribution rights, Century Medical agreed to provide Cardica with a loan of up to $4 million. Century’s obligation to offer the loan is contingent upon certain development milestones for the Microcutter devices.
Cardica stated that it has achieved the first Microcutter milestone, which has allowed it to draw down $2 million under the loan facility from Century Medical. The company expects to attain the second milestone within the next several months, enabling it to access additional amounts under the loan commitment.
The balance drawdown of the loan by Cardica will be due in September 2016, contingent upon specific conditions. The company plans to use the loan to fund the ongoing development and commercialization activities across Europe and the U.S.
Tokyo-based Century Medical currently distributes Cardica’s PAS-Port proximal anastomosis (communication between blood vessels) system for coronary artery bypass graft (“CABG”) surgery in Japan.
Under the deal, Century Medical is responsible for obtaining the approval of the Ministry of Health in Japan. Following the regulatory clearance, Cardica will sell its Microcutter products to Century Medical who would distribute them to customers in the island nation.
Cardica’s Microcutter product line has been geared to offer genuine multi-fire endoscopic stapling for a number of procedures, such as thoracic, colorectal as well as general surgery.
The Microcutter line-up is expected to cut and staple on a continuous basis, thereby permitting the surgeon to complete consecutive deployments without removing the device to reload the cartridge. The Microcutter XPRESS 30 is the first product in the Microcutter family which Cardica intends to market.
Cardica makes stapling devices for endoscopic and cardiac surgery procedures. Its proprietary technology is designed to reduce operating time and enable minimally-invasive and robot-assisted surgeries.
The company markets its automated anastomosis systems for CABG surgery and has sold over 36,000 units globally. Cardica competes with larger players such as Johnson & Johnson (JNJ) and Covidien (COV) in the laparoscopic stapling and sealing devices market.
