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British medtech Phagenesis snaps $42M for its device to treat swallowing disorders

Phagenesis funding
Picture credits: Phagenesis

Dysphagia, which is the swallowing dysfunction is a severe medical condition that affects countless patients in hospital. Patients with dysphagia are unable to safely or effectively eat, drink, or manage their own saliva. It can often lead to life threatening complications such as pneumonia and is also associated with substantially higher healthcare costs. This is where, Phagenesis, a Manchester-based medical device startup has developed a neurostimulation system to treat Dysphagia. 

Raises Series D funding 

Now, Phagenesis has closed $42 million in an all equity Series D investment round. The combined European and United States investment syndicate was led by EQT Life Sciences, and co-led by Sectoral, with new investors British Patient Capital, Northern Gritstone, which backed Floreon, C-Capture, and QV Bioelectronics, and Aphelion also joining the round. 

Given the recent approval of Phagenyx®, Phagenesis’ therapy, by the FDA, this investment will support commercialisation in the US and further its presence in Europe. It will also support clinical trials, regulatory activities, and research and development of pipeline products.

Randomised controlled trials have demonstrated clinically significant improvements, which support faster recovery of patients and reduced length of hospital stay. As part of this round, Drew Burdon, Michael Sjöström and Mark Wyatt will join the Phagenesis’ Board of Directors.

Drew Burdon, Partner at EQT Life Sciences, said: “Dysphagia is a severe medical condition that affects countless patients in hospital. It can increase hospital length of stay, the risk of complications, and lengthens recovery time. The Phagenyx System demonstrates significant reductions in hospital length of stay, with a corresponding and substantial reduction in healthcare costs, as evidenced by the Company’s strong portfolio of high-quality clinical studies. This is strongly aligned with EQT’s Health Economics strategy of transforming cutting-edge scientific innovation into impactful and cost-effective healthcare solutions. We‘re excited to support the next phase of Phagenesis’ journey.”

Michael Sjöström, Co-Founder and Partner at Sectoral Asset Management, added, “Dysphagia associated complications are known to substantially increase mortality, but there is still a lack of adequate treatment modalities. That’s why Phagenyx is an amazing innovation with the potential to change care paradigms. It allows treatment of dysphagia very early in the care pathway, which prevents later complications. Our investment will support the Phagenesis team to make Phagenyx more broadly available, specifically in the United States.”

Treats neurogenic dysphagia

Phagenesis was co-founded by Dr. Conor Mulrooney and Professor Shaheen Hamdy from the University of Manchester in 2007. Its offers innovative treatments for neurogenic dysphagia, a difficulty in swallowing food caused by disease or impairment of the nervous system, including stroke and traumatic brain injury. 

“This investment from a highly experienced international investor syndicate will accelerate access to and adoption of our therapy,” said Reinhard Krickl, CEO of Phagenesis. “We will invest in exceptional talent to scale up our customer outreach and to support passionate clinicians who want to bring our therapy to those who need it. Our novel and proven therapy can help the millions of patients every year who suffer from swallowing disorders.”

How does it work?

Phagenyx® uses pharyngeal electrical stimulation (PES) after years of rigorous scientific research. As per the company, it is said to be the first and only treatment using PES to restore swallowing control, facilitate airway protection, and accelerate recovery. 

Personalised levels of PES, delivered at the earliest stages after injury, enhance neurorehabilitation and reorganisation of swallowing control, while requiring minimal patient participation.

The Phagenyx® neurostimulation system targets and restores the neurological components of swallowing coordination and control that are disrupted due to brain injury (including stroke) or because of prolonged mechanical ventilation. 

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