Delphinus Raises $39M Capital

PLYMOUTH TWP. — The ultrasound-based breast imaging technology developer Delphinus Medical Technologies Inc. says it has secured $39.5 million in new venture capital.

The company said the funding round is the single largest amount ever raised for a healthcare imaging company in the Midwest, as well as the largest for a medical device company in Michigan.

The series C round was led by the Milwaukee-based venture capital firm Venture Investors LLC, and included new investment from Grand Rapids-based Hopen Life Science Ventures and Menlo Park, Calif.-based Waycross Ventures, along with current investors Arboretum Ventures of Ann Arbor, Beringea of Farmington Hills, and North Coast Technology Investors of Ann Arbor.

The oversubscribed financing round will be used to underwrite regulatory costs, continuing the commercialization of SoftVue, Delphinus’ whole-breast ultrasound system that allows doctors to image the entire breast, including the chest wall, for diagnostic purposes.

“Delphinus has the potential to have a profound impact on the effectiveness of breast cancer screening for a significant population of women who have dense breasts,” said John Neis, managing director at Venture Investors. “Data from their innovative approach demonstrate the potential to detect cancers in women with dense breast tissue that are missed by mammography, without the unacceptable false positive rate that has plagued prior attempts using screening ultrasound. They have assembled a world-class team, and we are proud to help pull together this strong investor syndicate, giving them the resources to complete the necessary clinical studies and bring this life-saving tool to the market.”

Currently, 24 states have enacted legislation requiring that women who have dense breast tissue receive notification of it in their mammography report. The legislation covers nearly two-thirds of the women in the United States. Dense breast tissue increases a woman’s chance of having breast cancer, yet presents a greater challenge in detecting it with mammography alone. Supplemental breast imaging, such as breast ultrasound, may benefit women with dense breast tissue.

As an ultrasound technology, SoftVue offers the potential to not only assist physicians in finding more cancers, but also to reduce the false positive rates that have troubled other breast imaging techniques. SoftVue’s unparalleled, sophisticated design incorporates a circular ultrasound transducer, unique to medical imaging, presenting cross-sectional ultrasound slices through the entire volume of breast tissue. The multi-dimensional imaging captures not only reflected echoes in a 360-degree array, but also signals passing through the breast, depicting tissue characterization.

“Our series C financing demonstrates the confidence that sophisticated medical device investors have in our SoftVue automated whole breast ultrasound technology, and its potential to serve women with a transformational approach to breast imaging,” said Mark J. Forchette, president and CEO of Delphinus. “This syndicate of investors combines the robust strength of the Midwest venture capital community with investors in Silicon Valley to provide diverse support for our breakthrough system, which was invented right here in Michigan.”

Delphinus is planning to launch a large multi-site clinical study to support a PMA application for a supplemental screening indication for women with dense breasts. Later this year, the company will begin by prospectively imaging 10,000 women with SoftVue in eight centers around the country. Using the imaging, a reader study will then be conducted. The study will compare SoftVue to digital mammography, and demonstrate its effectiveness in finding cancers that are not seen with mammography, while reducing false positives, thereby reducing the need for follow-up testing. False positives have gained recent attention in other breast imaging technologies and have been implicated in driving up healthcare costs, as well as patient anxiety.

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