Lombard Medical Technologies PLC raises £26.2 million on successful completion of IPO
London, 7 December 2005
Lombard Medical Technologies PLC (“Lombard” or the “Company”), a developer of stent grafts and other medical products, announces that it has successfully completed an initial public offering on the AIM market of the London Stock Exchange, raising £26.2 million of new money (before expenses) for the Company via a placing with institutional investors (the “Placing”) conducted by Code Securities Limited. It has today published its AIM Admission Document and the admission of the Company’s Ordinary Shares to trading on AIM (“Admission”) is expected to take place at 8:00 a.m. on Tuesday 13 December 2005 under the ticker symbol LMT. The nominated adviser and broker to the Company and agent in relation to the Placing is Code Securities Limited.
Pursuant to the Placing, the Company has issued 16,466,359 new Ordinary Shares at 159 pence per Ordinary Share, raising gross proceeds for the Company of £26.2 million (£23.9 million net of expenses) and existing shareholders sold 200,308 existing Ordinary Shares at 159 pence per share, raising gross proceeds of £0.3 million. A total of 48,893,590 Ordinary Shares will be in issue on Admission, giving a market capitalisation immediately following Admission of £77.7 million.
Lombard is producing the next generation of vascular devices which have a unique flexible design structure and which, as a result, are able to address the demands of both the abdominal and thoracic aortic aneurysm markets, each potentially valued at over US$1 billion by 2010. First generation devices have a number of limitations, principally caused by lack of flexibility and ease of application, which result in problems such as blood leakage around the stent graft, movement of the stent graft following operation and an inability to treat severely angulated aortas.
The Company’s lead product is a cardiovascular stent graft, Aorfix™, for the therapeutic treatment of abdominal aortic aneurysms (“AAA”). Lombard’s Aorfix™ abdominal stent graft is CE Mark approved in the EU and, through commercialisation and trials, there are now 100 of the Company’s implants in place in 10 EU countries. Aorfix™ has conditional Investigational Device Exemption approval from the US Food and Drug Administration in connection with US clinical trials, which are expected to start in Q1 2006. Lombard expects to launch the product in the US in 2008/2009.
Lombard has a strategic collaboration with one of the world’s leading medical device companies, Boston Scientific, which has an option to distribute the Company’s Aorfix™ stent graft products in markets outside the US. Boston has invested US$6 million in the Company to date and is investing again as part of the Placing.
AAA is an increasingly prevalent disease. An estimated 1.7 million North Americans have AAA, but only 250,000 to 300,000 are diagnosed each year. Currently in the US about 60,000 AAA patients require intervention each year. The majority of these patients are treated with open surgical repair, whilst about 40 per cent are treated with endovascular stent grafts. Although open AAA surgery can be very successful, it is also extremely invasive and carries a 5 to 6 per cent intra-operative mortality rate. Thus patients with significant co-morbidities are not generally candidates for open repair and it is these patients who have been the primary beneficiaries of endovascular stent grafting. The market for AAA stent grafts is expected to expand on a worldwide basis to US$1 billion by 2010.
The net proceeds of the Placing will be used to fund a clinical trials programme in the US for the Aorfix™ stent graft, develop the sales and marketing infrastructure of the Group, repay existing bank and other indebtedness and for general working capital purposes.
Alistair Taylor, Executive Chairman of Lombard, commented:
“We are delighted to be listing our shares on AIM. Lombard’s unique Aorfix™ stent graft technology overcomes many of the issues associated with first generation aneurysm stent grafts, addressing high-value markets and bringing much needed solutions to vascular surgeons and their aneurysm patients.
“Whilst we are already commercialising our products in Europe, there remains a major opportunity to be exploited in the US, and the placing proceeds will enable us to undertake the trials and obtain the necessary approvals to enter that market.”
Enquiries:
| Lombard Medical Technologies PLC |
|
|
| Alistair Taylor, Executive Chairman |
|
+44 (0) 1235 750 800 |
| Brian Howlett, Chief Executive Officer |
|
+44 (0) 1235 750 800 |
| Code Securities Limited |
|
|
| Juliet Thompson |
|
+44 (0) 20 7776 1200 |
| Richard Potts |
|
+44 (0) 20 7776 1200 |
| Financial Dynamics |
|
|
| David Yates |
|
+44 (0) 20 7831 3113 |
| John Gilbert |
|
+44 (0) 20 7831 3113 |
Notes to editors
Lombard is the holding company of a medical devices group focused on discovering, developing and commercialising innovative devices and technologies for use in the treatment of vascular disease.
The lead product of the Company’s principal business, the Cardiovascular Devices Division, is a bifurcated stent graft, marketed under the trade mark Aorfix™, for the therapeutic treatment of abdominal aortic aneurysms (AAA). This product has received a CE Mark and conditional IDE approval from the FDA in connection with US clinical trials. It is anticipated that following the successful completion of these trials, the Company expects to launch the product in the US in 2008/2009. AAA is an increasingly prevalent disease with an estimated 1.7 million North Americans having AAA, but only 250,000 to 300,000 are diagnosed each year. The market for AAA stent grafts in the US is forecast by Medtec Insight to reach US$552 million by 2008, and the Directors believe that this will continue to expand on a worldwide basis to US$1 billion by 2010.
Although initially the Company is commencing distribution of its Aorfix™ AAA stent graft products through independent distributors outside the US, it is the Company’s intention to work with strategic marketing partners to bring its devices to the market. To this end the Company has signed an agreement with Boston Scientific Limited whereby Boston Scientific Limited has an option to distribute the Company’s Aorfix™ stent graft products in markets outside the US.
Lombard is also developing a stent graft for the treatment of thoracic aortic aneurysms (TAA), which is nearing completion. The Directors anticipate that this product will enter CE Mark and FDA clinical trials in 2006. Estimates of the number of annual diagnoses range from 15,000 to 30,000 in the US, with more than 16,000 diagnosed in Europe annually. Like AAA, thoracic aneurysms are believed to be under-diagnosed, since most patients are asymptomatic. An estimated 70 per cent of TAA are currently not diagnosed, but this number is expected to fall in the coming years.
Thoracic stent grafts hold great promise not only for the treatment of TAAs, but also for other anomalies in the thoracic aorta, including acute and chronic dissections, penetrating ulcers, pseudo aneurysms and traumatic transections. It is for these reasons that the Directors believe that the TAA stent graft market has the potential to grow substantially. The Directors anticipate the commercial launch of the product in Europe in 2008 and in the US in 2009.
In addition, Lombard is developing a range of open surgery and endovascular surgery staplers. The open surgery stapler, manufactured under the trade mark Anson Refix™, has a CE Mark and FDA 510K certification and the Directors expect the endovascular stapler to receive both CE Mark and FDA 510K certification in the first half of 2006. Several of the first generation stent grafts have inadequate fixation which has resulted in migration of the stent graft. The endovascular stapler has, in vitro, demonstrated an ability to fix strongly a migrating stent graft, so that it has the potential to be not only a repair device but also used in new implantations. With the potential growth in TAA stent grafts mentioned above, fixation becomes even more of an issue as the thoracic aorta is a very dynamic anatomical environment. A further application is in the less invasive fixation of percutaneous heart valves, which is a new and fast developing market. The Company is in discussions with third parties with regard to licensing and/or distribution arrangements for its endovascular stapler line.
The Company’s other division is its Polymer Coatings Division, which has developed a series of products, including drug delivery coatings for coronary stents that will deliver one or more drugs on a programmable basis. The Company is in discussions with several companies with a view to licensing out the coatings for the treatment of coronary and peripheral vascular disease as well as for applications in urology.
Lombard Medical PLC, a subsidiary of the Company, was formed and admitted to AIM in 2000 and then taken private in 2003. The Company, based in Oxfordshire & Yorkshire, currently employs 47 people.
Further background on the Company can be found at www.lombardmedical.com
