Last year, HistoSonics won a key approval to market the Edison System, which uses sound waves to destroy cancer tumors.
HistoSonics expanding Plymouth HQ, lands $102 million in latest financing
The med-tech company uses sonic beams to destroy cancer tumors.
The Minnesota Star Tribune
August 15, 2024 at 6:30PM
Now the Plymouth-based med-tech company is doubling its headquarters space and attracting new investors as the promising treatment hits the market.
On Thursday morning, HistoSonics announced raising $102 million in a Series D financing round. The funds will support the company’s growth, CEO Mike Blue said.
Company backers include Johnson & Johnson Innovation, the medical giant’s venture arm, which Blue describes as “one of the largest investors in the company.”
HistoSonics, founded in 2009, has now raised over $300 million.
After more than a decade of research and years of trials, the U.S. Food and Drug Administration approved the Edison System for use on liver tumors last fall. The clearance kick-started the company’s commercialization of its technology and prompted an expansion.
“That has driven additional needs for assembly space as well as adding people across all functions,” Blue said.
HistoSonics leases about 26,000 square feet of space at 16305 36th Ave. N. in Plymouth. The expansion would add an additional 26,000 square feet, effectively doubling its space. Blue said the expansion will unfold in phases over two years.
Celcuity, a publicly traded drug development company, is headquartered at the same property on Hwy. 55 west of Interstate 494.
HistoSonics has 175 employees, including a research facility in Ann Arbor, Mich., which the company just relocated and expanded.
Noninvasive tumor removal
HistoSonics’ technology, called histotripsy, was developed at the University of Michigan. The science of histotripsy uses ultrasound energy to destroy and liquefy targeted liver tissue. It requires no surgery or radiation.
“It’s exceeding expectations right now in terms of demand,” Blue said. “It’s completely unique in that it is a noninvasive procedure.”
HistoSonics does not disclose the price of its Edison System, which it called the first histotripsy platform available in the U.S. In November the Centers for Medicare & Medicaid Services set a payment rate for the procedure at $17,500.
“This is a breakthrough technology platform,” said Jim Adox, chair of the HistoSonics board.
Adox, executive managing director of Madison, Wis.-based Venture Investors LLC, first invested in HistoSonics in 2009.
Under the FDA clearance, the HistoSonics system can be used only on liver cancer tumors, for now. Adox said there could be future applications for kidney, prostate and pancreatic cancers.
“Demand from both hospitals but also from patients has been really high,” he said. “There’s been a lot of grassroots interest in HistoSonics from patients and patient advocates.”
Sound wave technology is an emerging medical trend. Dr. Nick Kurup, a diagnostic and interventional radiologist at Mayo Clinic, said focused ultrasound waves have grown in use over the past several years.
“We at Mayo Clinic are optimistic about the future of minimally invasive and noninvasive therapies to treat cancer,” he said.
Dr. Clifford Cho, a professor of surgery at the University of Michigan, said the technology is drawing interest because it is unlike any other available treatments.
“We really haven’t had this kind of disruptive new technology entering the medical field in a really long time.”
Minneapolis-based health system becomes the fifth with operations in MN to say it’s going out-of-network with Humana for 2025.
