NovaSom, an Obstructive Sleep Apnea (OSA) management company, announced recently that it has closed $35 million in equity financing. The investment was led by Safeguard Scientifics, as well as previous investors including TPG Biotechnology II Fund and Quaker BioVentures.
In a press release, the company stated their intent to use the funding for growth, expansion in payer and provider markets, and development of of their NovaSom diagnostic medical device and cloud-based MediTrack Patient Management Portals. The Novasom device allows for testing of OSA at home, as opposed to polysomnography (PSG) tests at clinical facilities. NovaSom tracks user patterns over multiple nights, allowing for an analysis of typical sleep conditions. The collected data is then uploaded to the cloud thought the user's computer via the MediTrack software, where physicians can then assess whether the patient has OSA.
Roger Richardson, Novasom's vice president of operations, recently told the Baltimore Sun's technology columnist that the company is currently developing the next generation of the NovaSom device, which will send sleep data to the cloud via a wireless data connection.
"Safeguard’s capital, coupled with the continued financial and operational support of existing financial partners are compelling endorsements of NovaSom and its demonstrated ability to deliver innovative solutions to sleep apnea patients, providers and payers," stated Gerald Stone, CFO of NovaSom in a press release. “In addition, this financing enables us to accelerate growth to meet the needs of our rapidly growing physician and payer customer base. Our model empowers the primary care physician and consumer to achieve better cost and quality outcomes, consistent with the move to Accountable Care Organizations and the patient-centered medical home.”
“Across the healthcare spectrum, the migration to personalized, at-home, technology-enabled services that reduce costs and improve quality outcomes is undeniable,” stated James A. Datin, Executive Vice President and Managing Director of the Life Sciences Group at Safeguard.
Read the full press release after the jump.
New funds targeted to expand the company's Sleep Management Technology Services
NovaSom, Inc., the market leader in technology-driven, payer-aligned cost-saving solutions for Obstructive Sleep Apnea (OSA) management, on June 27th, announced it has closed $35 million in equity financing. Led by Safeguard Scientifics, Inc. (NYSE: SFE) with participation from existing investors including TPG Biotechnology II Fund and Quaker BioVentures, NovaSom will use the financing to fund growth, expand its leadership position in payer and provider markets, and develop additional innovations within the company’s proprietary NovaSom® diagnostic medical device and cloud-based MediTrack® Patient Management Portals.
“The prevailing approach to diagnosing OSA using facility-based overnight sleep center studies is both costly and limited in its capacity to serve large numbers of patients. The company's proprietary Home Sleep Test (HST) service is proven to be clinically equivalent to lab-based study for OSA detection.”
”OSA is one of the most serious and under-diagnosed medical problems in our country,” said Dr. Richard Hassett, CEO of NovaSom. “The prevailing approach to diagnosing OSA using facility-based overnight sleep center studies is both costly and limited in its capacity to serve large numbers of patients. The company's proprietary Home Sleep Test (HST) service is proven to be clinically equivalent to lab-based study for OSA detection.”
NovaSom’s unique home service delivery model, combined with a pioneering cloud-based portal technology, connects NovaSom with physicians, therapy providers and payers to achieve alignment in patient preference, cost and quality objectives. Payers and consumers are driving the adoption of HST as the preferred solution for addressing the OSA epidemic. Responding to the voice of payers, NovaSom has invested in technology solutions to enable its payer partners to rationalize OSA diagnosis and redirect testing to the home, when clinically appropriate.
"Safeguard’s capital, coupled with the continued financial and operational support of existing financial partners are compelling endorsements of NovaSom and its demonstrated ability to deliver innovative solutions to sleep apnea patients, providers and payers," stated Gerald Stone, CFO of NovaSom. “In addition, this financing enables us to accelerate growth to meet the needs of our rapidly growing physician and payer customer base. Our model empowers the primary care physician and consumer to achieve better cost and quality outcomes, consistent with the move to Accountable Care Organizations and the patient-centered medical home.”
“Across the healthcare spectrum, the migration to personalized, at-home, technology-enabled services that reduce costs and improve quality outcomes is undeniable,” said James A. Datin, Executive Vice President and Managing Director of the Life Sciences Group at Safeguard. “NovaSom has leveraged its market leadership position with an integrated medical management platform to enable aligned physicians and sleep therapy providers to bring an accountable sleep management solution to the payer markets. We are excited about partnering with the first, largest and most technologically advanced, FDA-approved Home Sleep Testing platform in the industry.”
Datin will join NovaSom’s board of directors. “With more than 25 years of experience in business development, sales and marketing in pharmaceutical, diagnostics, devices and software companies, Jim is an invaluable addition to our board. His expertise and strong relationships will augment our organization and drive shareholder value. We are excited to add this industry leader and visionary to our board,” concluded Dr. Hassett.
About Obstructive Sleep Apnea
Obstructive Sleep Apnea is a disorder characterized by impaired breathing during sleep due to airway obstruction, compromising airflow and oxygenation, usually accompanied by loud snoring. An estimated 40 million Americans have OSA, 18 million of them with moderate-severe disease, the vast majority of whom are undiagnosed and untreated, resulting in costly complications and premature death. Sleep Apnea is strongly linked to hypertension, heart attacks, congestive heart failure, fatal arrhythmias, diabetes, erectile dysfunction, depression, obesity and stroke. In addition, deprivation of quality sleep results in absenteeism, reduced productivity, fatigue, irritability and reduced quality of life.
About NovaSom
NovaSom, Inc. is a privately held diagnostic-service provider for home testing and evaluation of sleep-disordered breathing, which includes the diagnosis of obstructive sleep apnea (OSA). Based in Glen Burnie, Maryland, the company was incorporated in 1992. NovaSom is a Medicare-approved Independent Diagnostic Testing Facility (IDTF) and is fully accredited as both an Ambulatory Care Sleep Diagnostic Center and as a Telehealth provider by The Joint Commission. The home testing system manufactured and distributed by NovaSom has FDA clearance for the diagnostic evaluation of OSA in adults. NovaSom has integrated their home sleep testing system into a cloud based, collaborative patient management platform for physicians and payers. For more information, visit www.novasom.com.
About Safeguard Scientifics
Founded in 1953 and based in Wayne, PA, Safeguard Scientifics, Inc. (NYSE: SFE) provides growth capital for entrepreneurial and innovative life sciences and technology companies. Safeguard targets life sciences companies in Molecular and Point-of-Care Diagnostics, Medical Devices, Regenerative Medicine, Specialty Pharmaceuticals and selected healthcare services, and technology companies in Internet / New Media, Financial Services IT, Healthcare IT and selected business services with capital requirements of up to $25 million. Safeguard participates in expansion financings, corporate spin-outs, management buyouts, recapitalizations, industry consolidations and early-stage financings. For more information, please visit our website at www.safeguard.com, our blog at blog.safeguard.com or you can follow us on Twitter at twitter.safeguard.com or on LinkedIn at linked.safeguard.com.
