Orange County’s medical device companies are having a good year attracting venture funding.
Investors sank a hefty $108 million into local biotechnology, drug or medical device makers during the second quarter, according to the MoneyTree survey from PricewaterhouseCoopers LLP, Thomson Venture Economics and the National Venture Capital Association.
The total surpasses a recent high watermark reached in the fourth quarter of 2003, when local biotech and device makers attracted about $70 million in funding.
While venture funding can be spotty, the second-quarter showing marks a pickup in interest for healthcare-related startups here.
In the first quarter, about $28 million was invested in local biotech or device companies. Just one healthcare startup got funding in the fourth quarter, when virtually all financing went to technology companies.
That healthcare startups here are attracting a lot of funding isn’t unusual. OC has developed into a sizeable breeding ground for medical device startups.
The growth of big device makers such as Fullerton-based Beckman Coulter Inc., Santa Ana-based Advanced Medical Optics Inc. and Irvine-based drug and onetime eye device maker Allergan Inc., which spun off Advanced Medical a few years ago, has helped spawn the startups.
Meanwhile, the University of California, Irvine, has several programs geared to developing device technology, including a School of Biomedical Engineering.
UCI is raising money to start an eye institute, which would offer treatment, research and testing facilities. The university’s plan is to strengthen links between the school and local device and drug companies that are developing eye-related technology.
The biggest venture funding for any sector this year was a $35 million round for Orexigen Therapeutics Inc., a Laguna Niguel company that’s developing drugs to treat obesity.
Another big one also is one of the latest. In mid-August, Irvine-based Arbor Surgical Technologies Inc. got a $20 million second round of financing.
Arbor Surgical is a maker of replacement tissue heart valves. The company’s funding round was led by Baird Venture Partners, a unit of Milwaukee-based R.W. Baird & Co.
Arbor’s investors include Johnson & Johnson Development Corp., the medical and consumer product company’s venture arm.
Also in August, Irvine-based Alteer Corp., which makes software to manage medical practices, raised $16.5 million in venture funding.
The investment group was led by MedVentures of Emeryville and Sanderling Ventures of Palo Alto. Alteer has raised some $20 million in venture funds since its founding nine years ago.
July saw a big financing: Irvine’s TherOx Inc. said it inked $30 million in a deal led by New Science Ventures LLC of New York.
The company is developing technology that combines oxygen and water to create “aqueous oxygen.” TherOx also is working on a minimally invasive device to send the aqueous oxygen to the heart area.
The mixture minimizes the damage to the heart muscle following a heart attack, the company said. Injecting the solution is designed to follow surgery and stent device treatment after a heart attack.
TherOx has raised some $60 million in venture funding since its founding a decade ago.
Pegasus Biologics Inc. of Irvine raised $10 million in June. It’s the company’s second round of funding. Three Arch Partners of Menlo Park and Frazier Healthcare Ventures of Seattle led the investment.
Pegasus, founded in 2003, is developing the OrthAdapt Bioimplant, a collagen-based device to repair soft tissue defects in orthopedic, spine and neurosurgery conditions.
Also in June, 3F Therapeutics Inc., a Lake Forest company that’s developing a replacement tissue heart valve for less-invasive procedures, said it had received $6 million in “insider commitments” toward a $20 million venture round. No other details of the round were given.
Other second-quarter fundings tracked by the MoneyTree survey included a $22.7 million round for Lake Forest-based cardiac device maker Orqis Medical. Boston Scientific Corp. was among the investors in the round.
Orqis is developing a device for treating congestive heart failure, which often leads to swelling of the legs and ankles and congestion in the lungs.
AcuFocus Inc., an Irvine company that’s developing an implant to treat vision loss in older people, attracted $27.5 million in venture funds in the period.
First-quarter startup fundings included an $8.7 million round for Alsius Corp., an Irvine maker of catheters and body temperature monitors for the neurology and heart markets; $8.3 million for Visiogen, an Irvine company that makes an intraocular lens for correcting vision problems; $2 million for Konova Inc., a Laguna Niguel maker of anti-obesity drugs; and $1.6 million for Novocell, an Irvine startup that’s developing cell transplant therapies.
The biggest first-quarter deal on the healthcare front was inked by IntraLens Vision Inc., a Lake Forest eye device maker.
IntraLens picked up $12 million in a round led by Canaan Partners and InterWest Partners, both of which have offices in Menlo Park.
IntraLens, which also named eye device veteran Randy Alexander as chief executive at the time of the funding, is developing a corneal implant lens to treat vision loss in people older than 40.
In February, Aliso Viejo-based Medsphere Systems Corp. received a $7 million second round of venture funding, led by Azure Capital Partners, a San Francisco investment firm.
Medsphere sells software used by hospitals, clinics and doctors to manage clinical, financial and administrative data.
One local venture investor has been active across the OC line in San Diego this year.
Domain Associates, which has an office in Laguna Niguel, teamed with Prospect Venture Partners of Palo Alto to lead a $78 million first round of funding for Verus Pharmaceuticals Inc.
Verus is a San Diego company that is developing drugs to treat breathing problems in kids.
And in March, Domain participated in a $27 million investment in Novalar Pharmaceuticals Inc., a Del Mar company that’s developing a product to reverse lip and tongue numbness associated with dental anesthesia.
