06.29.15
Minneapolis, Minn.-based Kips Bay Medical Inc. is dissolving after its decision to end the Emesh I clinical feasibility trial due to poor results. Early angiographic results from enrolled patients who had an ESVS mesh implanted using the new surgical implant technique were unsatisfactory.
The Emesh I clinical feasibility trial was a multi-center, randomized study of external saphenous vein graft (SVG) support using the company’s ESVS mesh in coronary artery bypass graft (CABG) surgery, the objective of which was to demonstrate to the U.S. Food and Drug Administration (FDA) the initial safety and performance of the ESVS mesh for use as an external SVG support device during CABG surgery. The trial completed enrollment in March 2015 with 106 patients, including 50 patients enrolled with a new surgical implant technique approved by the FDA in March last year. The company terminated the trial based on poor six-month angiographic results in the first 26 patients.
In light of the termination of its feasibility trial, Kips Bay’s board of directors unanimously approved a plan of dissolution and liquidation of the company. Of the strategic alternatives available to the company, the board determined that it is in the best interests of the company and its stockholders to dissolve the company, wind up its operations and return any remaining cash to its stockholders. As of June 27, Kips Bay had cash and cash equivalents of $2 million, which the company anticipates should be sufficient to pay off all of its current and anticipated liabilities and to conduct an orderly wind down of its operations. According to company officials, Kips Bay cannot determine with certainty the amount of any liquidating distribution to its stockholders and it is possible that there will be no liquidating distribution to stockholders. The amount of any cash distributed to its stockholders will depend upon, among other things, the company’s current liquid assets offset by its known and unknown liabilities as well as operating expenses associated with the dissolution.
According to the board, its decision to dissolve came after completing an exhaustive evaluation of various strategic alternatives available to the company for enhancing stockholder value, including but not limited to continued execution of its business plan and further modification of Kips Bay’s ESVS mesh device and implant technique; the sale of the company or its assets, including its intellectual property portfolio; partnering or other collaboration agreements; a merger, reverse merger or other strategic transaction.
Kips Bay plans to seek stockholder approval of the dissolution and liquidation at an upcoming meeting of stockholders, which it intends to convene as early as September 2015. Despite its plan to seek a dissolution and liquidation of the company, Kips Bay intends to continue to review and evaluate any available strategic alternatives. If the board receives an offer for a transaction that is more beneficial to the stockholders than dissolution, the company reserves the right to rescind the decision to dissolve.
Also in light of the termination of its feasibility trial and intent to wind down its operations, Kips Bay has implemented further cost-reduction measures, including additional staff reductions.
“We are, needless to say, extremely disappointed with the poor six-month angiographic results from the new technique patients. We had hoped the new technique would reduce or prevent the resulting injury which can lead to SVG failure and potentially costly and complicated re-interventions for patients undergoing CABG surgery,” said Chairman and CEO Manny Villafana. “I would like to thank the patients who participated in this study as well as our clinical trial investigators and their teams. I am also very appreciative of our employees, to many of whom we must now sadly say goodbye and for the continued support and loyalty of our stockholders.”
The Emesh I clinical feasibility trial was a multi-center, randomized study of external saphenous vein graft (SVG) support using the company’s ESVS mesh in coronary artery bypass graft (CABG) surgery, the objective of which was to demonstrate to the U.S. Food and Drug Administration (FDA) the initial safety and performance of the ESVS mesh for use as an external SVG support device during CABG surgery. The trial completed enrollment in March 2015 with 106 patients, including 50 patients enrolled with a new surgical implant technique approved by the FDA in March last year. The company terminated the trial based on poor six-month angiographic results in the first 26 patients.
In light of the termination of its feasibility trial, Kips Bay’s board of directors unanimously approved a plan of dissolution and liquidation of the company. Of the strategic alternatives available to the company, the board determined that it is in the best interests of the company and its stockholders to dissolve the company, wind up its operations and return any remaining cash to its stockholders. As of June 27, Kips Bay had cash and cash equivalents of $2 million, which the company anticipates should be sufficient to pay off all of its current and anticipated liabilities and to conduct an orderly wind down of its operations. According to company officials, Kips Bay cannot determine with certainty the amount of any liquidating distribution to its stockholders and it is possible that there will be no liquidating distribution to stockholders. The amount of any cash distributed to its stockholders will depend upon, among other things, the company’s current liquid assets offset by its known and unknown liabilities as well as operating expenses associated with the dissolution.
According to the board, its decision to dissolve came after completing an exhaustive evaluation of various strategic alternatives available to the company for enhancing stockholder value, including but not limited to continued execution of its business plan and further modification of Kips Bay’s ESVS mesh device and implant technique; the sale of the company or its assets, including its intellectual property portfolio; partnering or other collaboration agreements; a merger, reverse merger or other strategic transaction.
Kips Bay plans to seek stockholder approval of the dissolution and liquidation at an upcoming meeting of stockholders, which it intends to convene as early as September 2015. Despite its plan to seek a dissolution and liquidation of the company, Kips Bay intends to continue to review and evaluate any available strategic alternatives. If the board receives an offer for a transaction that is more beneficial to the stockholders than dissolution, the company reserves the right to rescind the decision to dissolve.
Also in light of the termination of its feasibility trial and intent to wind down its operations, Kips Bay has implemented further cost-reduction measures, including additional staff reductions.
“We are, needless to say, extremely disappointed with the poor six-month angiographic results from the new technique patients. We had hoped the new technique would reduce or prevent the resulting injury which can lead to SVG failure and potentially costly and complicated re-interventions for patients undergoing CABG surgery,” said Chairman and CEO Manny Villafana. “I would like to thank the patients who participated in this study as well as our clinical trial investigators and their teams. I am also very appreciative of our employees, to many of whom we must now sadly say goodbye and for the continued support and loyalty of our stockholders.”