ST. PAUL, Minn., May 23, 2017 /PRNewswire/ -- EnteroMedics
Inc. (NASDAQ:ETRM), the developer of medical devices treating
obesity, metabolic diseases and other gastrointestinal disorders,
announced today that it has acquired the Gastric Vest System™ (the
"Gastric Vest" or "Vest"), through its acquisition of BarioSurg,
Inc.
The Gastric Vest is an investigational, minimally-invasive,
laparoscopically implanted medical device being studied for weight
loss in morbidly obese patients. The device, which wraps around the
stomach and emulates the effect of conventional weight loss
surgery, enables gastric volume reduction without permanently
changing patient anatomy. In a pilot study conducted outside the
U.S., at 12 months, Vest patients demonstrated a mean percent
excess weight loss (%EWL) of 85%, an average drop in HbA1c
(Hemoglobin A1c) of 2.1 points, and an average waist circumference
reduction of 38 centimeters, or approximately 15 inches.
"We are excited to both incorporate BarioSurg's Gastric Vest
into our now further differentiated portfolio of medical devices
for fighting obesity and related comorbidities, and to explore
potential clinical opportunities to combine the Vest and vBloc
Therapy®," said Dan
Gladney, EnteroMedics President, Chief Executive
Officer and Chairman of the Board. "As we move toward building a
comprehensive bariatric and metabolic continuum of care platform to
effectively address unmet needs within these areas, we believe that
the strong foundation we've built at EnteroMedics will maximize the
potential for a successful approval and the subsequent
commercialization of this device. We look forward to sharing more
details on this morning's conference call."
"Based on early results, when comparing short-term %EWL, the
Gastric Vest appears to perform as well as, and possibly even
better than, gastric bypass and sleeve gastrectomy procedures,"
stated Scott Shikora, MD, Director,
Center for Metabolic and Bariatric Surgery, Brigham and Women's
Hospital, Former President of the American Society for Metabolic
and Bariatric Surgery, and Chief Medical Consultant, EnteroMedics.
"If the Vest continues to yield similar results to those observed
to date, it will be a game changer in the field of bariatrics."
Raj Nihalani, MD, inventor of the Gastric Vest System, Founder
and Former Chief Executive Officer of BarioSurg stated:
"EnteroMedics is a leader in minimally-invasive, sustainable weight
loss treatment with vBloc Therapy. I look forward to joining the
company and navigating a path toward potential FDA approval and
eventual commercialization, while at the same time exploring ways
in which the Vest may be able to be combined with vBloc Therapy to
enhance patient outcomes."
The consideration paid by EnteroMedics for BarioSurg, Inc.
consists of 1.38 million unregistered shares of EnteroMedics common
stock, 1.0 million unregistered shares of conditional convertible
preferred stock (which will be convertible into 5.0 million
unregistered shares of common stock upon the receipt of the
required approval of EnteroMedics' stockholders under NASDAQ
rules), and $2.0 million in cash. The
shares of common stock issued in the acquisition represent 19.99%
of EnteroMedics' outstanding common stock immediately prior to the
acquisition. EnteroMedics expects to hold a special meeting
of its stockholders to seek the required approval of the conversion
of the conditional convertible preferred stock in the summer of
2017.
In connection with the acquisition, EnteroMedics has appointed
Dr. Nihalani as Chief Technology Officer, EnteroMedics.
Conference Call Details
A conference call will be held today at 10:00 AM Eastern Time and may be accessed by
dialing (877) 280-7473 (U.S. and Canada) or (707)
287-9370 (international), and entering passcode 22469535. A replay
of the call will be available from May 23 at 2:00 PM
Eastern Time through May 30 at 2 PM Eastern
Time by dialing (855) 859-2056 (U.S. and Canada) or
(404) 537-3406 (international), and entering passcode 22469535.
To access the live webcast, visit the events page of the
investor relations section of EnteroMedics' website at
www.enteromedics.com. A replay of the webcast will be available
immediately after the conference call.
About EnteroMedics Inc.
EnteroMedics is a medical device company focused on the
development and commercialization of its neuroscience based
technology to treat obesity and metabolic diseases. vBloc®
Neurometabolic Therapy, delivered by a pacemaker-like device called
the vBloc® System, is designed to intermittently block the vagus
nerves using high-frequency, low-energy, electrical impulses.
EnteroMedics' vBloc® System has received U.S. Food and Drug
Administration approval and CE Mark.
About BarioSurg Inc.
BarioSurg, Inc. was founded in 2008 by Dr. Raj Nihalani.
BarioSurg was a privately held medical device company that
developed the proprietary, minimally invasive and reversible
device, the Gastric Vest System™ to treat obesity and related
comorbidities.
Information about the vBloc® System and
vBloc® Neurometabolic Therapy
vBloc Therapy is approved for use in helping with weight loss in
people aged 18 years and older who are obese, with a BMI of 40 to
45 kg/m2, or a BMI of 35 to 39.9
kg/m2 with a related health condition such as Type
2 diabetes, high blood pressure, high cholesterol levels or
obstructive sleep apnea who have had a poor response to trying to
lose weight under supervision in the last 5 years. You should
not have an implanted vBloc® System if you have cirrhosis of the
liver, high blood pressure in the veins of the liver, enlarged
veins in your esophagus or a significant hiatal hernia of the
stomach; if you need magnetic resonance imaging (MRI); if you have
a permanently implanted, electrical medical device; or if you need
a diathermy procedure using heat. The most common related adverse
events that were experienced during clinical study of the vBloc
System included pain, heartburn, nausea, difficulty swallowing,
belching, wound redness or irritation, and constipation.
Talk with your doctor about the full risks and benefits of vBloc
Therapy and vBloc System. For additional prescribing information,
please visit www.enteromedics.com.
If you are interested in learning more about vBloc
Neurometabolic Therapy, please visit www.vbloc.com or call
1-800-MY-VBLOC.
Important Information
EnteroMedics intends to file a
proxy statement and other relevant materials with the Securities
and Exchange Commission (the "SEC") to obtain approval from
EnteroMedics' stockholders of the conversion of the preferred stock
issued to BarioSurg's stockholders in connection with the
acquisition into shares of EnteroMedics common stock (the
"Stockholder Approval"). INVESTORS AND SECURITY HOLDERS ARE
URGED TO READ THE PROXY STATEMENT AND OTHER RELEVANT MATERIALS
FILED WITH THE SEC CAREFULLY IN THEIR ENTIRETY AS THEY BECOME
AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE
STOCKHOLDER APPROVAL. The proxy statement, any amendments or
supplements to the proxy statement and other relevant documents
filed by EnteroMedics with the SEC will be available free of charge
through the web site maintained by the SEC at www.sec.gov or by
calling the SEC at telephone number 1-800-SEC-0330. Free copies of
these documents may also be obtained from EnteroMedics' website at
www.enteromedics.com or by writing to: EnteroMedics Inc., 2800
Patton Road, St. Paul, Minnesota
55113, Attention: Investor Relations.
EnteroMedics and its directors and executive officers are deemed
to be participants in the solicitation of proxies from the
stockholders of EnteroMedics in connection with the Stockholder
Approval. Information regarding EnteroMedics' directors and
executive officers is included in EnteroMedics' definitive proxy
statement for its 2017 annual meeting of stockholders to be held on
June 1, 2017, which was filed with
the SEC on April 27, 2017.
Other information regarding the participants in such proxy
solicitation and a description of their direct and indirect
interests, by security holdings or otherwise, will be included in
the proxy statement to be filed in connection with the Stockholder
Approval.
Forward-Looking Safe Harbor Statement:
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. These forward-looking statements generally can be identified
by the use of words such as "expect," "plan," "anticipate,"
"could," "may," "intend," "will," "continue," "future," other words
of similar meaning and the use of future dates.
Forward-looking statements in this release include statements
concerning the performance, commercialization and FDA approval of
the Gastric Vest and statements about the benefits of the
acquisition and the combined company's plans, objectives,
expectations and intentions with respect to future operations,
products and services. These forward-looking statements are based
on the current expectations of our management and involve known and
unknown risks and uncertainties that may cause our actual results,
performance or achievements to be materially different from any
future results, performance or achievements expressed or implied by
the forward-looking statements. Applicable risks and uncertainties
related to the acquisition include, but are not limited to, the
following: the acquisition may involve unexpected costs or
liabilities; the ability to recognize benefits of the acquisition;
and risks that the merger disrupts current plans and operations.
Additional risks and uncertainties include, among others: our
limited history of operations; our losses since inception and for
the foreseeable future; our limited commercial sales experience
with our vBloc® System for the treatment of obesity in
the United States or in any
foreign market other than Australia and the European Community; the
competitive industry in which we operate; our ability to maintain
compliance with the Nasdaq continued listing requirements; our
ability to commercialize our vBloc® System; our
dependence on third parties to initiate and perform our clinical
trials; the need to obtain regulatory approval for any
modifications to our vBloc® System; physician adoption
of our vBloc® System and vBloc®
Neurometabolic Therapy; our ability to obtain third party coding,
coverage or payment levels; ongoing regulatory compliance; our
dependence on third party manufacturers and suppliers; the
successful development of our sales and marketing capabilities; our
ability to raise additional capital when needed; international
commercialization and operation; our ability to attract and retain
management and other personnel and to manage our growth
effectively; potential product liability claims; the cost and
management time of operating a public company; potential healthcare
fraud and abuse claims; healthcare legislative reform; and our
ability to obtain and maintain intellectual property protection for
our technology and products. These and additional risks and
uncertainties are described more fully in the Company's filings
with the Securities and Exchange Commission, particularly those
factors identified as "risk factors" in the annual report on Form
10-K filed March 8, 2017 and
quarterly report on Form 10-Q filed May 15,
2017. We are providing this information as of the date of
this press release and do not undertake any obligation to update
any forward-looking statements contained in this document as a
result of new information, future events or otherwise.
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SOURCE EnteroMedics Inc.
