IntraLase Corp., an Irvine-based eye device maker, is set to take nearly 129,000 square feet for a new headquarters that would triple the size of the company’s local operations.
The lease also would mark one of the largest office leases in Orange County in the past year.
The company plans to move from its present headquarters at 3 Morgan in Irvine to 9701 Jeronimo Road this spring. IntraLase has 42,000 square feet of space on Morgan.
The 10-year, four-month lease is valued at about $18 million, according to real estate sources. The lease starts May 1.
More workers and growing sales spurred the need for more space, said Franklin Jepson, the company’s director of investor relations.
Late last week IntraLase said its fourth-quarter revenue almost doubled to $19.2 million, versus a year earlier. The company said its operating loss widened to $3.4 million in the fourth quarter, versus a loss of $2.3 million a year earlier.
The loss surprised Wall Street, sending shares down 10% immediately after the earnings release. But IntraLase said it boosted spending for several reasons.
“Seeing an opportunity to accelerate our momentum in the marketplace, we increased our spending for technical and clinical support services, sales, marketing and production,” said Chief Executive Robert Palmisano, in a statement.
The company has some 250 workers, up from 178 last summer, Jepson said.
IntraLase was the only OC-based medical device company to go public last year. It raised $86 million when its stock debuted out in October.
At the time, Palmisano said most of the money raised in the offering was set for research and development.
IntraLase makes lasers and software used in vision correction surgery. Its IntraLase FS creates a flap on a patient’s cornea, the first step in fixing vision through laser surgery. IntraLase FS is designed to replace a microkeratome, a metal blade that is used to create a corneal flap.
In an earlier interview, Palmisano said spending money on research and development and getting good engineers and scientists was key because IntraLase’s strategy was “more dependent upon taking share away from an antiquated technology,” referring to the microkeratome.
“If the market grows, it’s wonderful, we’re all for that,” Palmisano said. “But as far as IntraLase goes, we’re not dependent on it.”
The company does face a challenge on selling eye surgeons on its products, which are more costly than microkeratomes. IntraLase’s laser costs about $350,000, compared to between $40,000 and $60,000 for microkeratomes.
But Palmisano said he was confident that would happen: “Once a doctor has one of our units in their practice, they generally convert their practice almost totally. They don’t use the technology they were using much anymore.”
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IntraLase was established in 1997 and raised more than $70 million in venture capital funding from firms including Domain Associates, which has offices in Laguna Niguel and Princeton, N.J., and Versant Ventures, with offices in Newport Beach and Menlo Park.
Two IntraLase officials, Tibor Juhasz, chief technical officer, and Ronald Kurtz, medical director, developed the technology that IntraLase was built on. Juhasz and Kurtz also are professors at the University of Michigan.
IntraLase had been “considering a variety of alternatives” to its building on Morgan for more than six months, Jepson said.
Potential locations “were all in Orange County,” Jepson said. “We did not want to move any great distance.”
Phil Cohen, a broker at CB Richard Ellis Group Inc.’s Newport Beach office, represented landlord John Saunders. Ken Ward, president of Newport Beach-based Cresa Partners LLC, represented IntraLase in the lease.
