Medical device executive Michael Glennon and cardiac surgeons Dr. Brian J. deGuzman and Dr. Lishan Aklog founded Pavilion Holdings Group (PHG), with the goal of building a portfolio of medical device companies, using an innovative business model focused on capital efficiency and speed to market. PHG’s portfolio companies used this streamlined business model, featuring outsourced, best-in-class process expertise that maximizes operational and capital efficiency, preserves founder and investor equity, and facilitates strategic partnerships or acquisitions. Vortex Medical, Inc., the co-founders’ first company, was launched in 2008 with a $3.5 million investment from Catalyst Health Ventures. Vortex advanced its revolutionary AngioVac® system, designed to remove large volume clots and other undesirable intravascular material, from concept to commercialization in less than 18 months.
Pavilion Holdings Group launched Pavilion Medical Innovations (PMI), a medical device incubator, together with Dr. Al Chin, a highly prolific and commercially successful medical device inventor. PMI’s mission was to help physician entrepreneurs bring new medical device concepts to market in a capital-efficient and timely manner by offering single-source convenience for all of the processes required to move a novel device from concept to commercialization. PMI spun out three venture/angel-backed companies: Saphena Medical, which has commercialized VenaPax, a next-generation endoscopic vessel harvesting device for coronary bypass surgery; Cruzar Medsystems, which has commercialized the Houdini catheter to treat peripheral chronic total occlusions; and Kaleidoscope Medical, which is developing a reversible inferior vena caval filter which is currently under FDA review.
After several years of commercialization, Vortex Medical was acquired by Angiodynamics, Inc. (Nasdaq:ANGO) for $55 million in guaranteed consideration and additional royalties. AngioVac has proven to be a life-saving tool, used to treat thousands of patients with conditions ranging from pulmonary embolism, deep vein and inferior vena cava thrombosis, endocarditis and other conditions in the heart.
Pavilion Holdings Group’s portfolio consisted of privately-held, individually capitalized, single-product companies, which were built to be sold. PAVmed was created to adapt the Pavilion model to a long-term, multi-product company with access to the public capital markets. PAVmed’s structure enables us to retain the model’s tight focus on capital efficiency and speed to market, as well as the core elements that drive that efficiency, including limited infrastructure and low fixed costs; while allowing us to take advantage of the economies of scale and flexibility in deploying resources inherent in a multi-product company. PAVmed began with five medical device innovations conceived by its founders: PortIO, CarpX, NextCath, NextFlo, and Caldus.
In April of 2016, PAVmed completed an initial public offering of 1,060,000 units on the Nasdaq Capital Market at an offering price of $5.00, with each unit consisting of one share of common stock and one warrant exercisable at $5.00, generating gross proceeds of $5.3 million. Three months later, the units split and the common stock and warrants began trading on Nasdaq under the symbols “PAVM” and “PAVMW,” respectively. In November, PAVmed signed a definitive licensing agreement with a group of leading academic institutions, including Tufts University and two Harvard Medical School teaching hospitals – Massachusetts Eye and Ear Infirmary and Massachusetts General Hospital, providing PAVmed with an exclusive worldwide license to develop and commercialize antibiotic-eluting resorbable ear tubes based on a proprietary aqueous silk technology conceived and developed at these institutions.
Our project selection process places a heavy emphasis on medical device products with the potential for high margins and high impact in attractive markets, without regard to target clinical specialty or condition. We favor products that address conditions affecting significant patient populations, lower overall costs, lessen procedural invasiveness or decrease complications and recovery times. We also look for products with strong intellectual property positions that do not require significant capital equipment, are eligible for the FDA’s 510(k) pathway and possess an attractive reimbursement profile.
Our development and commercialization processes are specifically tailored to each product in our pipeline, so we can optimize capital and time efficiency and maximize value creation. We utilize parallel development processes such as engineering, quality, regulatory, supply chain and manufacturing, as well as outsourced, best-in-class process experts on an as-needed basis. In addition, we pursue the shortest, most efficient path to commercialization of a safe and effective first-generation device while employing iterative product development based on real-life product performance and user feedback.
Our implementation strategy focuses on advancing lead products toward commercialization as quickly and efficiently as possible while expanding our pipeline by progressing conceptual phase projects through patent submission and early testing. In addition, we license technologies for development and commercialization from innovative clinicians and academic medical centers. We also pursue shorter-term, lower-risk projects to maintain balance within our pipeline. Projects that can be rapidly commercialized help generate revenue to support the development of longer-term projects.