This post comes from my colleague, Janet Moore:
Turns out, rumors of Acorn Cardiovascular’s demise are premature.
The struggling New Brighton med-tech company is still in business, and trying mightily to stay that way, according to CEO Steve Anderson.
“We have cut back, but we’re still alive,” Anderson said Thursday. “We’re trying to raise more capital or sell the company. Basically, we’re looking at all the options.”
Privately held Acorn has raised a whopping $110 million since 1998 to develop a unique heart device called CorCap for patients suffering from heart failure. But over the past decade, the fledgling firm has repeatedly encountered issues with the Food and Drug Administration (FDA) as it attempts to gain agency approval.
CorCap is a mesh, girdle-like device that supports the heart, which often swells to three times its normal size as heart failure progresses.
Two advisory panels for the FDA recommended against approval of the Acorn device after reviewing the company’s application and holding public hearings. The agency itself rejected the company’s application three times. Acorn took its case to a dispute resolution panel, a highly unusual move in the device world, which also voted against approval.
But Acorn had been encouraged along the way by Dr. Daniel Schultz, now the deposed head of the FDA’s device division. The company reached an agreement with the agency to conduct three more clinical studies of 150 patients to confirm the results of a previous, pivotal trial.
That was 2007. “We thought we had an agreement,” Anderson said, noting the company at that time raised an additional $22 million to keep going.
Then in November 2008, the high-profile consumer advocacy group Public Citizen expressed “deep concern” about whether the FDA had sufficiently reviewed the device.
More recently, new, more-aggressive leadership has been installed at the FDA in the wake of criticism that it has been too cozy with industry.
“The FDA came back to us in February and said they wanted a different trial with a different design,” Anderson said.
As the venture capital funds dry up in a tough economy, Anderson said it’s increasingly difficult to keep the company going, especially since it cannot get any firm commitment from the FDA about how the new study should be designed.
When asked about the fund-raising climate for a small start-up, Anderson said, “It’s horrible. Terrible. The worst ever.”
JANET MOORE • 612-673-7752