With the ambition to continue riding the wave of positive momentum, PolarCool recently raised 5 MSEK in a directed share issue to invest in further market expansion. As the company eyes the single largest market for medtech devices, the USA, competitor TecTraum’s pro2cool concussion treatment device recently received Breakthrough Device Designation from the FDA. BioStock got in touch with PolarCool’s CEO Erik Andersson to get his thoughts on the developments overseas and what it means for PolarCool’s ambitions.
PolarCool has seen increased interest in its brain cooling device PolarCap System within Sweden and Europe as more and more professional sports clubs and leagues strive to increase player safety. As summarised in the company’s Q3 report last week, during the autumn, PolarCap System has had breakthroughs in French rugby, Swiss ice hockey and, most recently, in British soccer with the introduction of the device in the English Premier League (PL), which is one of the largest sports markets in the world.
Capital raised to continue towards ambitious goals
The company’s goal is to accelerate its establishment and sales in Europe and expand to other markets outside European borders. Topping the list is the USA, a market where contact sports like American football and ice hockey, among others, are extremely popular, and where concussion rates are quite high. In fact, according to a study from 2013, close to 4 million athletes suffer from concussions each year in the US alone. To set the stage for advancements toward the US market, PolarCool raised 5 MSEK in a directed share issue subscription price at a subscription price of 3.30 SEK/share.
Some big names participated in this the private placement, including Eva Redhe, Wobbler Invest, Exsultat AB and Joel Almqvist, each of whom contributed 0.75 MSEK.
PolarCool’s CEO Erik Andersson comment on the capital raise in a recent press release:
»With the new share issue, PolarCool is broadening its ownership base, which will contribute experience and expertise. The goal is to accelerate the growth journey that the company has begun. The company looks forward to continuing to establish PolarCap in the European market and, with the expected FDA approval, launch the launch in the US market.«
PolarCool sees strong potential in the US as competition heats up
As PolarCool aims for a push in the US, recent market events indicate that PolarCap System would have strong potential for entering that market. In early November, news broke that the FDA had award Breakthrough Device Designation (BDD) to pro2cool, a non-invasive hypothermic therapy device designed to reduce the severity of concussion symptoms and developed by American medtech company TecTraum.
According to Businesswire, TecTraum has undergone the successful completion of pilot studies with pro2cool and is nearing completion of a large multi-site pivotal clinical trial to validate the device’s effectiveness, safety, and tolerability in patients between the ages of 12 and 21.
The FDA’s designation not only gives TecTraum’s device a prioritised path towards market registration under a De Novo 510 k, but it also signals an opening for other companies working in the field to insert themselves into the US market.
This strengthens the case for PolarCool’s PolarCap System, which is backed by clinical evidence showing a significant reduction in the proportion of absence from gameplay for players who suffered from concussion but received immediate care with PolarCap. Read more about the clinical evidence for PolarCap here.
»PolarCool sees the US market as a key market for the company. Sports are an integral part of American society with American football being at the forefront. It is a sport where concussions problems have received increased attention in recent years. The number of practitioners who could benefit from PolarCap is quite large, where we also see great potential in the world of universities and colleges. Therefore, an FDA approval would potentially have a huge impact for the company, opening up several possibilities.« — Erik Andersson, CEO PolarCool
CEO sees an opportunity
BioStock reached out to PolarCool’s CEO Erik Andersson to get his thoughts on the company’s ambition to commercialise PolarCap System in the US.
Erik Andersson, first of all, what is the take-home message from PolarCool’s Q3 report?
– That we continue to establish ourselves in new markets and that, with the new capital raise, we are given the opportunity to accelerate that establishment by strengthening the market part of the company.
Could you expand on what the proceeds from the latest capital raise will go towards?
– They will mostly go toward market activities focusing on the markets where we see greater interest today.
How important is it for the company to broaden its ownership base?
– It is important and positive in that the new shareholders are showing a long-term commitment with their investment. Also, with their experience in company development, they can contribute with their skills and knowledge.
Could you speak to the market potential for PolarCool in the US?
– PolarCool sees the US market as a key market for the company. Sports are an integral part of American society with American football being at the forefront. It is a sport where concussions problems have received increased attention in recent years. The number of practitioners who could benefit from PolarCap is quite large, where we also see great potential in the world of universities and colleges. Therefore, an FDA approval would potentially have a huge impact for the company, opening up several possibilities.
How does TecTraum’s concussion treatment device compare to PolarCap System?
– Our ambition is for the PolarCap System to be the best alternative for acute algorithm-controlled cooling treatment of concussions. As for TecTraum’s device, their study has focused on younger individuals compared PolarCap System’s focus group, which has been professional athletes. This is because their device cools with a higher temperature and smaller surface area compared to PolarCap. Furthermore, their device has not been tested in the acute phase of injury, unlike PolarCap. However, we see a potential market for PolarCap in the non-acute phase as well.
– It should also be noted that the PolarCap System has two different cooling modes: Treatment mode and Convenient Mode. Treatment Mode is a more powerful mode, tested on professional ice hockey players during clinical evaluation. Convenient Mode, on the other hand, produces less powerful cooling, which more closely compares to pro2cool’s settings. Therefore, even though it has yet to be clinically evaluated, PolarCap System could become a competitor to pro2cool and the target group that TecTraum have done their clinical research on.
– The fact that pro2cool develops this market from a regulatory perspective is very good for PolarCool because it will give us a clearer path forward from that perspective, when the time comes. In any case, we welcome all research that, like ours, shows the positive effects of cooling treatment.
Finally, how does the FDA’s Breakthrough Device Designation for pro2cool affect PolarCool’s US market entrance strategy?
– We are running a 510k process, which is in the final phase – a “substantial review” to obtain clearance for temperature regulation. We will continue to work according to the plan that is being concretized regarding the US. Like our strategy in Europe, we will initially work towards implementation within professional league sports and teams in the biggest sports. However, as I mentioned earlier, we see great potential in the American school system where most of the sports that are practiced there, such as American football and ice hockey, have known problems with concussions. But even in basketball and lacrosse, concussions occur, which is why the PolarCap System would be useful in these sports as well.The content of BioStock’s news and analyses is independent but the work of BioStock is to a certain degree financed by life science companies. The above article concerns a company from which BioStock has received financing.