Raising money for a startup company during a pandemic is no cakewalk, according to Manny Villafaña. But he did it.
Medical 21, the latest venture for the founder of St. Jude Medical, has raised another $3 million in an equity offering, according to an SEC filing.
The most recent round brings the Minneapolis-based startup’s total funding to $8 million of the $10 million Villafaña said he was seeking in early 2020. Now he’s set his sights higher, boosting the goal to $11 million to $14 million.
Medical 21, which was unveiled in late 2017, is developing an artificial blood vessel as an alternative to harvesting blood vessels from other parts of the body for coronary artery bypass surgeries. The company is using a new material developed by the University of Iowa and licensed to the company to make its artificial vessels. The material consists of cellulose graft conduits supported by a thin nitinol wire, similar to what was used in Villafaña’s previous start-up, Kips Bay Medical, which closed its doors in 2015.
Medical 21’s first investors came on board in 2019. The company now has 15 investors, all private, Villafaña told Medical Design & Outsourcing. Proceeds are slated for general working capital purposes, including the payment of salaries to officers. The company listed an estimated total of $500,000 to be used for payments to executive officers, directors or promoters.
“We were able to raise money during COVID, which was not a cakewalk,” Villafaña said in a phone interview. “It’s our goal to eventually take the company public at the appropriate time after we begin our human trials.”
Medical 21 is currently conducting animal testing. Villafaña said he hopes to begin human trials in late 2022.
‘We’re strictly a company in research and development trying to develop an artificial graft for bypass surgery. It will affect an awful lot of people. This market is bigger than pacemakers and heart valves combined,” Villafaña said.
“This is a very challenging project,” he added. “No one’s ever done this before… You are trying to replace an organ with something that the body won’t reject and will do the same job as a vessel. It doesn’t clog, it doesn’t wear out. All the major medical companies have tried but no one has done it.
“Everybody, please be patient with me.”