A Tempe-based biotech company has landed one of the largest venture capital deals – if not the biggest – so far this year in Arizona.
Nectero Medical, which focused on heart disease treatments, has closed a $96 million series D round led by Norwest Venture Partners with participation from Boston Scientific Corporation, BioStar Capital, Cadence Healthcare Ventures, Aphelion Capital and other investors.
Nectero will use the new investment to accelerate the second and third phases of a clinical trial for its Nectero Endovascular Aneurysm Stabilization Treatment (EAST) system, according to the company.
The company launched clinical trials in January to investigate safety and effectiveness of its EAST system in patients with infrarenal abdominal aortic aneurysms. Clinical trials will be held at 45 sites nationwide, including in the Phoenix area, Nectero President and CEO Jack Springer told AZ Inno.
Nectero will also use proceeds to support submission of a new drug application for its EAST System with the U.S. Food and Drug Administration.
Nectero EAST is a single-use, endovascular system that delivers pentagalloyl glucose locally into the aneurysmal wall, where it binds to elastin and collagen to strengthen the aortic vessel wall and potentially reduce further degradation. The procedure takes less than an hour to complete and leaves no permanent implant behind, according to the company.
As part of the new investment, Dr. Zack Scott, of Norwest Venture Partners, and Dr. Alan Davis, of BioStar Capital, have joined Nectero’s medical board of directors.
“The Nectero EAST System has the potential to have a profound impact on the hundreds of thousands of patients living with aneurysmal disease and would represent the most significant advancement in the treatment of AAA in over 25 years,” Scott said.
If clinical trials are successful, Nectero’s EAST system could offer patients with smaller abdominal aortic aneurysms the first approved therapeutic option beyond surveillance, according to the company.
“FDA has granted breakthrough therapy designation for the Nectero EAST system, acknowledging that the preliminary clinical evidence indicates that the combination product may demonstrate substantial improvement over available therapy on a clinically significant endpoint(s),” Davis, managing director of BioStar Capital, said in a statement.
Nectero had received $19.5M in 2021
Nectero’s most recent capital raise builds upon a $19.5 million series C round it secured in 2021 from global medical device manufacturer Boston Scientific Corp. and other investors.
What’s more, Nectero’s $96 million investment marks the largest raised this year among venture capital-backed companies in Arizona, according to PitchBook.
In January, Tucson-based Sion Power raised $75 million in a series A round to commercialize battery technology for electric vehicles. That round was led by South Korean battery company LG Energy Solution, with participation from Euclidean Capital and Hillspire LLC, the family office of former Google CEO Eric Schmidt.
In addition, Tucson-based stratospheric balloon company World View in February raised $70.7 million in a series D deal led by Sierra Nevada Corp., according to PitchBook data.
Earlier this month, World View closed another $25 million to establish a regional Indo-Pacific headquarters in Melbourne, Australia. The $25 million investment is part of World View’s ongoing series D round with a rolling close, the company told the Business Journal.
