Initial Clinical Studies Completed with Significant Positive Results
The Cleveland Clinic Foundation, Abbott Laboratories and a New Era Associates (NEA) fund to Acquire Economic Interests in VTAK
Fort Mill, S.C., April 23, 2025 (GLOBE NEWSWIRE) -- Catheter Precision, Inc. (VTAK:NYSE-American), (the Company) today announced that it has signed a definitive agreement to acquire, through its newly formed, 82% owned subsidiary, Cardionomix, Inc. assets of Cardionomic, Inc. relating to its Cardiac Pulmonary Nerve Stimulation (CPNS) System.
Cardionomic was a venture capital and strategic investor-funded privately held company backed by the Cleveland Clinic Foundation, Abbott Laboratories and New Enterprise Associates (NEA) that had been developing for a number of years a new therapy based upon novel technology for the treatment of acute decompensated heart failure, or ADHF, for which over 1 million Americans are hospitalized annually. Patients admitted for ADHF have high in-hospital morbidity, frequent rehospitalization and subsequent death. The CPNS System consists of electrical stimulation via a temporary catheter inserted in the pulmonary artery targeting the root cause of heart failure by stimulating the autonomic cardiac nerves to restore autonomic balance. The initial target patient population for the therapy is hospitalized ADHF patients with ejection fraction of less than or equal to 50%, and signs or symptoms of fluid overload despite the use of diuretics. To date, initial clinical data demonstrated very promising clinical efficacy. Highlights of the positive results from clinical data from these pilot studies include:
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Significantly less worsening of acute heart failure once presented to the hospital.
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Significantly increased fluid loss in hospital without worsening renal function.
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Significantly improved quality of life reported at thirty days.
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Dramatic reduction of mortality or hospitalization at six-month follow-up.
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Significant multiple (2.8x) over standard of care in the WIN ratio, a widely used statistical method for reporting ADHF endpoints that compares successful outcomes to unsuccessful outcomes.
The clinical studies also paved the way for a pre-pivotal study incorporating important lessons learned regarding administration and useful modifications.
David Jenkins, CEO of VTAK, commented, “When we were approached by Cleveland Clinic Foundation to take over this project, we could not have been more excited. The original concept and development were a joint effort among Cleveland Clinic, Abbott Labs and NEA, each of which has been impressed by the therapy’s results and were seeking new commercial leadership to take it through FDA approval and to potential commercialization. With demonstrated results, 49 patents issued and a further 46 patent applications, an alignment with the FDA for the pivotal trial, a known reimbursement pathway, and a very large potential market for the technology, we are very pleased to have landed the opportunity and look forward to its future. In the US alone, we estimate that there are approximately 1 million hospital admissions for heart failure every year, and we see this as a market that could potentially create well over $1 billion in annual revenues within the U.S. ADHF population. Based on the information available to us, we believe that certain previous investors in Cardionomic, Inc. including the Cleveland Clinic Foundation, Abbott Laboratories and New Era Associates 13, that are currently creditors of the seller of the assets, will receive economic interests in the Catheter Precision common stock and the Cardionomix note issued in the transaction.”
Phil Anderson, CFO of VTAK, further commented: “Concurrent with our due diligence and the negotiation of this definitive agreement, we have been in discussion with a number of investors, including venture, strategic, and family offices to purchase a minority position in the new subsidiary, the proceeds of which would fund development of the acquired assets independent of VTAK’s balance sheet. We expect to conclude this financing in the near future.”
Transaction Terms
The consideration to be paid by the Company will be 1,000,000 shares of its unregistered common stock, and the issuance by its 82% owned subsidiary of a three-year promissory note of $1.5 million bearing simple interest of 4% per annum, with zero principal or interest due until maturity. The Company is not a guarantor of this note. The closing of the transaction is subject to normal closing conditions, including the approval of the listing of the shares by the NYSE American. David Jenkins, Catheter Precision’s CEO and Chairman of the Board, and certain of his affiliates and associates, own approximately 12% of Cardionomix, Inc. The Company is purchasing patents and trademarks for Cardionomic’s CPNS System, on an as is basis, from a third-party assignee.
Additional Information
This release and all other releases from Catheter Precision, Inc. are limited in their entirety by other information filed with the SEC including, but not limited to, our latest 10-K, 10-Q’s, and 8-K’s, including our Form 8-K reporting the transactions described herein which is expected to be filed on or about the date hereof and which will contain additional material information relating to the acquisition, and should be read in conjunction with those filings. Pilot studies described are preliminary and investigational by their nature. As described below the therapy described is not yet approved by the FDA, and like all medical treatments will not be suitable or successful for every patient and may cause unwanted side effects.
Caution Regarding Forward Looking Statements
This communication contains forward-looking statements. Forward-looking statements can be identified by words such as "believe," "anticipate," "may," "might," "can," "could," "continue," "depends," "expect," "expand," "forecast," "intend," "predict," "plan," "rely," "should," "will," "may," "seek," “promising,” “potential,” or the negative of these terms and other similar expressions, although not all forward-looking statements contain these words. These forward-looking statements are subject to the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. Forward-looking statements contained in this press release include, but are not limited to, express and implied statements regarding the following: our expectation to acquire assets of Cardionomic, Inc.; our positive expectations for planned clinical studies, including our belief that the CPNS System will demonstrate clinical efficacy and our expectation of FDA alignment; our belief that we will achieve reimbursement for the CPNS System due to a known reimbursement pathway; our estimates of approximately 1 million hospital admissions for heart failure per year, and a market that can create well over $1 billion in annual revenues; our expectation to conclude financing for the new subsidiary and that the proceeds of such financing will fund development of the acquired assets independent of VTAK’s balance sheet. The Company's expectations and beliefs regarding these matters may not materialize. Actual outcomes and results may differ materially from those contemplated by these forward-looking statements as a result of uncertainties, risks and changes in circumstances, including but not limited to risks and uncertainties included under the caption "Risk Factors" in the Company's 2024 Form 10-K filed with the SEC and available at www.sec.gov. These risks and uncertainties include, but aren't limited to: that the closing of the asset acquisition described above remains subject to important closing conditions that may not be met; that our ability to develop and commercialize the CPNS System could be adversely impacted if we are unable to maintain protection of the patents and trade names related thereto, which we are acquiring on an as is basis without recourse; that we may not be able to obtain the financing for the new subsidiary that we anticipate and/or such financing even if obtained may not be adequate for the development of the CPNS System; and that we may not adequately address the lessons learned from the pilot studies which included fatigue to nerves if stimulation is delivered for too long; high amplitude stimulation can lead to unstable hemodynamics, rhythm disturbances, and patient sensation; optimal stimulation response is dependent on more than just contractility; stimulation beyond 48 hours did not show additional benefit; stimulator modifications required to reduce procedure time, complexity, and improve user experience; and minor catheter modifications needed to accommodate larger anatomy in heart failure patients. FDA review of the CPNS System is likely to be costly and lengthy, and there is no guarantee that clearance and approval will ever occur or occur on a timetable that is beneficial to the Company. Additionally, the new subsidiary has other, minority investors aside from the Company, and future financings are expected to involve the issuance of securities by the subsidiary, which will reduce the Company’s share in the profits, if any, from the CPNS System and the new subsidiary, and is likely to involve the grant of special corporate governance rights to other subsidiary investors so that the Company will not have unfettered control of the new subsidiary. There is no guarantee that the success of the pilot studies will be repeated in future trials or ultimately lead to a successful commercialization of the CPNS System. The medical device industry in general is highly competitive, and some of our competitors have longer, more established operating histories, with significantly greater financial, technical, marketing, sales, distribution, and other resources. The CPNS System is not the only device-based neuromodulation therapy currently in development for the treatment of heart failure and further must also compete against potential new drug therapies. In general, results of anticipated trials may not turn out as we currently expect, and future trials may not occur on the timetables we expect or may be more costly than anticipated. Our belief regarding the current economic interests of Cleveland Clinic Foundation, Abbott Laboratories and New Era Associates (NEA) and their potential future acquisition of interests in Company and Cardionomix securities, is based on information provided to us by the seller of the assets and has not been independently verified. Further, to our knowledge, these entities are not equity holders of the seller, and their formal approval was not required for the sale of the assets to us. Accordingly, there can be no guarantee that these entities have not already divested, and/or will not in the near future divest, themselves of their interests in the seller and in the Company and Cardionomix securities that it receives.
In addition, our forward looking statements are subject to the following additional uncertainties and risks: we do not have sufficient liquidity to fund our business unless we are able to obtain additional financing or enter into a strategic transaction that would provide additional liquidity during the next three to six months, we will not be able to reach profitability unless we are able to achieve our product expansion and growth goals, our research and development and commercialization efforts may depend on entering into agreements with corporate collaborators, we have in the past entered into joint marketing agreements with respect to our products, and may again enter into additional joint marketing agreements in the future that could reduce our revenues from product sales, if we experience significant disruptions in our information technology systems, our business may be adversely affected, litigation and other legal proceedings may adversely affect our business, if we make acquisitions or divestitures, we could encounter difficulties that harm our business, failure to attract and retain sufficient qualified personnel could also impede our growth, failure to maintain effective internal controls could cause our investors to lose confidence in us and adversely affect the market price of our common stock, we have determined that our internal controls and disclosure controls were not effective as of March 31, 2024, June 30, 2024, September 30, 2024, and December 31, 2024, and as a result, without effective remediation of the material weaknesses that we have identified, we may not be able to accurately report our financial results or prevent fraud, our revenues may depend on our customers' receipt of adequate reimbursement from private insurers and government sponsored healthcare programs, we may be unable to compete successfully with companies in our highly competitive industry, many of whom have substantially greater resources than we do, our future operating results depend upon our ability to obtain components in sufficient quantities on commercially reasonable terms or according to schedules, prices, quality and volumes that are acceptable to us, and suppliers may fail to deliver components, or we may be unable to manage these components effectively or obtain these components on such terms, if hospitals, physicians and patients do not accept our current and future products or if the market for indications for which any product candidate is approved is smaller than expected, we may be unable to generate significant revenue, if any, our medical device operations are subject to pervasive and continuing FDA regulatory requirements, our products may be subject to additional recalls, revocations or suspensions after receiving FDA or foreign approval or clearance, which could divert managerial and financial resources, harm our reputation, and adversely affect our business, changes in trade policies among the U.S. and other countries, in particular the imposition of new or higher tariffs by the U.S. and/or its trading partners could increase our expenses, require us to increase prices, potentially lowering demand for our products, and/or reduce our revenues and operating results, and such increase , or the imposition of other barriers to international trade, could have a material adverse effect on our revenues and operating results. The risks and uncertainties described above may be amplified by the COVID-19 pandemic, which has caused significant economic uncertainty, or other pandemics, supply chain disruptions from the Ukraine war or Israeli-Hamas conflict and otherwise, and ongoing volatility in the stock markets and the U.S. economy in general.
The forward-looking statements included in this communication are made only as of the date hereof. The Company assumes no obligation and does not intend to update these forward-looking statements, except as required by law.
CONTACTS:
At the Company
Investor Relations
973-691-2000
IR@catheterprecision.com
Investor Relations:
Jeff Ramson
PCG Advisory
jramson@pcgadvisory.com
