CVRx: Pioneering Hypertension And Heart Failure Devices – Big Markets Take Big Funding

Article preview from IN VIVO - December 20, 2013

Starting as the first company with a device therapy for resistant hypertension, CVRx was soon competing with the renal denervation avalanche, along with trying to survive the economic collapse and a failed trial. Fortunately, the company had gotten its funding when the getting was good.

CVRx: Pioneering Hypertension And Heart Failure Devices – Big Markets Take Big Funding

Article preview from IN VIVO - December 20, 2013

Can a medtech start-up raise too much money? Most device CEOs today would see that as a nice problem to have. The corollary question long debated in management circles is whether a company should raise money when funding is available or only when necessary? During frothy or even ordinary times, you could find device CEOs coming down on both sides of that question. Now, however, with companies scrambling to survive the global economic collapse and the concomitant demise of much of medtech venture capital, there aren’t too many start-up CEOs who would criticize a colleague for going to the financing well for as much cash as possible.

That is the choice that Nadim Yared, CEO of Minneapolis-based CVRx Inc. faced in 2007. Of course, Yared did not know then of the impending economic collapse, nor did he know that CVRx would subsequently fail its pivotal trial, imperiling the company’s survival. Indeed, when the firm was launched in 2001 as the only device-based therapy to treat drug-resistant hypertension, CVRx officials also did not know that soon would emerge a competing treatment called renal denervation that would become one of the hottest device markets of the decade.

While there are arguments on both sides of the when-to-raise-money question, CVRx’s story may be a sign that the change in the medtech financing climate over the past few years may have tilted the balance in favor of raising money when you can, not waiting until you need it. In the case of CVRx, critics may argue that raising $250 million, as the company did, may limit your exit opportunities. But at least the company is around to try to solve that problem.

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