S-1/A: Cortigent Eyes $15 Million IPO to Advance Vision and Stroke Recovery Tech

Cortigent, a neurostimulation technology company, is seeking to raise approximately $15 million through an initial public offering to fund the development of its Orion artificial vision system and stroke recovery technology.

Summary

• Cortigent, Inc., a company focused on developing neurostimulation systems, is planning an initial public offering (IPO) to raise capital for its research and development efforts.
• The company's lead product, the Orion Visual Cortical Prosthesis System, aims to restore partial vision to individuals with profound blindness, targeting a U.S. market of approximately 82,000 people.
• Cortigent is also developing a stroke recovery system designed to improve arm and hand function in partially paralyzed stroke patients, addressing a significant unmet medical need.
• The IPO is expected to generate net proceeds of approximately $13.2 million, or $15.2 million if the underwriters exercise their over-allotment option in full, based on an assumed initial public offering price of $10.00 per share.
• The funds will be allocated primarily to Orion research studies, manufacturing devices for clinical trials, repaying amounts owed to its parent company Vivani, and for working capital.
• Cortigent has applied to list its common stock on the Nasdaq Capital Market under the symbol CRGT.
• Following the IPO, Vivani Medical, Inc. will retain approximately 77% of the voting power of Cortigent's common stock, making it a controlled company.
• The company's clinical development timelines target launching Orion on the U.S. market in 2028 and the stroke recovery system in 2029, subject to FDA approvals and adequate financing.

Sentiment

Score: 6

Explanation: The document presents a balanced view, highlighting both the potential of Cortigent's technology and the significant risks and challenges associated with its development and commercialization. The company's lack of revenue and dependence on future funding contribute to a neutral sentiment.

Positives

• Orion has received FDA Breakthrough Device designation, potentially accelerating its development and review.
• The company has an extensive intellectual property portfolio with 235 issued U.S. patents and 36 issued European patents.
• Cortigent is leveraging its experience from the FDA-approved Argus II system to develop new neurostimulation technologies.
• The company is targeting large addressable markets with significant unmet medical needs.
• Early feasibility studies of Orion have shown promising results in improving visual function.

Negatives

• Cortigent currently has no commercial products or product revenue and may never become profitable.
• The company's future success depends on its products being accepted in the market.
• Clinical development of medical devices involves a lengthy and expensive process with an uncertain outcome.
• The company will require substantial additional capital to support its clinical trials and growth plans.
• The initial public offering price of the common stock will be substantially higher than the pro forma net tangible book value per share, resulting in immediate and substantial dilution for new investors.

Risks

• Cortigent may face substantial competition in the future and may not be able to keep pace with the rapid technological changes.
• The results of Cortigent's limited initial trials may not be predictive of future trial results.
• The company may be subject to litigation in the operation of its business.
• Any failure or delay in completing clinical trials or studies could adversely affect its business.
• If Cortigent or its licensors are unable to protect its/their intellectual property, then Cortigent's financial condition, results of operations and the value of Cortigent's technology and products could be adversely affected.
• Any revenue from sales of Cortigent products will be dependent upon the pricing and reimbursement guidelines adopted in each country, and if pricing and reimbursement levels are inadequate to achieve profitability, Cortigent's operations will suffer.
• The price of our common stock may be volatile, and the value of your investment could decline.

Future Outlook

Cortigent anticipates launching Orion on the U.S. market in 2028 and the stroke recovery system in 2029, contingent on successful trial outcomes, regulatory approvals, and adequate financing.

Management Comments

• Cortigent is planning to work with the FDA to gain agreement on the additional clinical studies that will be required to secure marketing approval for Orion.
• We believe that our 60-channel cortical stimulation device has the potential to target neuron bundles more precisely and generate favorable clinical results.

Industry Context

The medical device industry is characterized by rapid technological change and intense competition, with companies vying to develop more effective, safer, and less costly treatments for various conditions. Cortigent faces competition from established medical device companies, academic institutions, and research organizations, as well as smaller, early-stage companies.

Comparison to Industry Standards

• Other visual prosthesis companies with technologies under development include Pixium Vision SA (Pixium) that was developing the PRIMA (sub-retinal implant) in Dry-AMD patients.
• In January 2024, Pixium announced the opening of judicial liquidation proceedings.
• Nano Retina Inc., a company based in Israel, is reported to have developed technology that may improve retinal prostheses in the future.
• A Nano Retina clinical trial is underway in Europe and Israel, and five subjects reportedly have been implanted to date.
• Bionic Vision Technologies, based in Australia, is developing a Bionic Eye Visual Prosthesis System, and has completed a two-year feasibility study in four patients in Australia.
• It has announced a partnership with Cirtec Medical in the U.S. and is believed to be planning a pivotal clinical trial.
• The Illinois Institute of Technology's Intracortical Visual Prosthesis (ICVP) has been designated as a Breakthrough Device and has advanced to an early feasibility study in the U.S.
• To date, one subject of five has been implanted.
• Neuralink company has demonstrated a penetrating electrode cortical implant in animal models and recently announced implanting its first patient with their brain computer interface (BCI) device.
• In the field of medical device-assisted stroke rehabilitation, MicroTransponder Inc. sells the Vivistim FDA-approved vagus nerve stimulator (VNS).

Related Party Transactions

• Vivani has provided $3.5 million in funding to Cortigent under the terms of the Transition Funding, Support and Services Agreement.
• Vivani will provide the services of its Chief Operating Officer, Truc Le, on an interim basis to consult on operations matters.
• Vivani will provide the services of its Chief Business Officer, Donald Dwyer, on an interim basis to consult on business development matters.
• Cortigent will be providing to Vivani the services of Edward Sedo, its chief financial officer.
• Vivani has guaranteed the prompt payment of all rents and all other sums payable under the lease together with all other terms and conditions to be kept and performed under the lease by the lessee.

Stakeholder Impact

• The IPO will provide Cortigent with the necessary capital to advance its research and development programs, potentially leading to new treatments for blindness and stroke.
• The success of Cortigent's products could improve the quality of life for patients with visual impairments and motor disabilities.
• The IPO will provide investors with an opportunity to invest in a company with innovative neurostimulation technologies.
• The company's success will depend on its ability to attract and retain highly skilled personnel.

Next Steps

• Cortigent plans to work with the FDA to gain agreement on the additional clinical studies that will be required to secure marketing approval for Orion.
• The company intends to manufacture and validate new Orion devices for a planned pivotal clinical trial.
• Cortigent intends to commence the pivotal trial in early 2026, complete it by approximately early 2028, and if successful to be able to launch Orion on the US market in 2028.
• For the stroke recovery system, Cortigent anticipates manufacturing modified clinical trial devices for the planned Early Feasibility Study (EFS) in parallel with manufacturing of the Orion devices.
• Cortigent intends to commence this EFS for the stroke recovery system in early 2026.
• Cortigent intends to commence a pivotal clinical trial for the stroke recovery system in mid-2027, complete it by early 2029, and if successful to be able to launch the stroke recovery system in 2029.

Key Dates

Keywords

neurostimulation, artificial vision, stroke recovery, Orion, Argus II, IPO, clinical trials, FDA, medical device, blindness, paralysis