Irvine startup AqueSys Inc. has $35 million in fresh venture funding and a former Advanced Medical Optics Inc. executive at the helm as it goes after a potentially big market.
The medical device maker is developing a surgical implant for treating glaucoma, an incurable eye disease that damages the optic nerve and often leads to blindness.
The company finished a third round of funding late last month that should help it reach regulatory and sales milestones, according to Chief Executive Ron Bache.
Bache, who was a vice president at Santa Ana’s Advanced Medical, said he expects the company’s implant to be used in patients with early and late stages of glaucoma. The disease affects about 4 million Americans, according to the San Francisco-based Glaucoma Research Foundation.
Glaucoma is incurable, but vision loss can be stopped with treatment.
AqueSys is touting its implant as an alternative to traditional glaucoma treatments, including drugs and surgery, which sometimes are less effective.
“Medications are very effective early on,” Bache said. But “over time, they either begin to lose effectiveness or patients have compliance problems with the drugs, so their disease gets back out of control.”
AqueSys’ implant is placed in a patient’s eye with an insertion device and a sterilized needle, similar to intraocular lens implants for cataract surgery.
The implant doesn’t deliver drugs to the eye. Instead, it takes some of the fluid out of the chamber behind the cornea to lower pressure in the eye, according to Bache.
“Our end game is to have an implant that can lower pressure 30% to 40% in a 10-minute (or less) procedure that can be safely adopted by a wide range of ophthalmic surgeons,” he said.
AqueSys is in the process of filing for a clinical trial with the Food and Drug Administration. Bache declined to outline a timeline for potential U.S. approval.
Global Market
The device maker plans to sell its implant outside the U.S. in 2011 through a direct sales force, Bache said.
Globally, glaucoma affects 65 million people.
One of AqueSys’ new investors, Longitude Capital of Menlo Park and Greenwich, Conn., estimates that the yearly drug and surgery market for treating glaucoma totals about $4.5 billion.
AqueSys stands to have some big rivals.
In drugs, Allergan Inc. of Irvine has several products targeted toward treating glaucoma, including Alphagan P, Lumigan, Combigan and Ganfort.
Switzerland’s Alcon Inc., which has more than 770 workers in Irvine, sells Travatan and Azopt drugs and the Ex-Press surgical device, which lowers pressure in the eye.
And Santa Ana-based Abbott Medical Optics Inc.—which Advanced Medical now is known as after a $2.8 billion buy by Abbott Laboratories last year—markets the Baerveldt glaucoma implant, which was developed by University of California, Irvine, professor George Baerveldt.
AqueSys’ product targets a niche of glaucoma sufferers who are referred to surgery.
Rho Ventures, which has offices in New York, Menlo Park and Montreal, decided to invest in AqueSys because it believes “there is a significant unmet need” for the about 600,000 U.S. glaucoma patients who are referred for surgery annually due to the progression of the disease, said Gregory Grunberg, one of the firm’s principals.
Rho and Longitude led AqueSys’ latest round of funding.
AqueSys’ funding round also included several existing investors.
Accuitive Medical Ventures of Palo Alto, the Carlyle Group, a Washington, D.C.-based private equity fund, and SV Life Ventures of San Francisco, Boston and London, participated in the funding.
AqueSys’ investment brings its total raised to $51 million in its four-year history.
Bache has spent nearly 17 years in the eye business. While at Advanced Medical, he was involved in several deals to build up that company’s eye surgery unit. Advanced Medical spent $1.3 billion for Santa Clara-based Visx Inc. in 2005 and another $808 million for IntraLase Corp. in 2007.
Bache was with Advanced Medical when it spun off from Allergan in 2002 and was global vice president of marketing for Advanced Medical’s refractive group.
“It was very good training for what I’m doing now,” he said.
The Innovation Factory, a Duluth, Ga.-based investment firm that founded and incubated AqueSys, brought Bache to the company in early 2009.
AqueSys moved to OC because of “access to critical human resources. The potential for talent around here in ophthalmology is the best in the world,” Bache said.
The company plans to hire more workers with the funding, but Bache declined to say how many people.
In the meantime, AqueSys isn’t thinking about either an initial public offering or being bought by a larger device maker.
“We’re keeping our head down and very focused about solving the glaucoma problem. We think if we do that, keep our focus on that, those other things take care of themselves,” Bache said.
