Quanta Raises $245M In Series D, Plans To Expand Into Home-Based Dialysis In US
UK-based Quanta will use the proceeds to ramp up European commercialization and bring its SC+ portable hemodialysis system to US-based acute and chronic care facilities, but ultimately hopes to enter the rising US home-based dialysis market.
Six months after receiving US Food and Drug Administration 510(k) clearance for its SC+ portable hemodialysis system for use in acute and chronic care facilities, Quanta Dialysis Technologies Ltd has raised $245m in a series D financing to help “turbocharge its business,” according to Quanta CEO John Milad.
“The main focus of [using] the proceeds will be to ramp up our UK and European commercialization [following the second CE mark in 2019 for its second-generation hemodialysis device), to have a really strong launch in the US, and then to scale that … and scaling up our manufacturing,” Milad told Medtech Insight.
The company’s series D financing was led by Glenview Capital and co-led by Novo Holdings, with support from other investors including BlackRock, Eldridge, Sands Capital, Millennium, Monashee Investment Management LLC, Puhua Capital, Segulah Medical and Ancora, alongside Orlando Health. Existing shareholders participating in the round include Wellington Partners, btov, Seroba Life Sciences and The Grands.
UK-based Quanta has recruited 15 people at its US headquarters in Beverly, MA, to provide support for customers and bring the product into acute and chronic care facilities in the US, Milad said.
Quanta also plans to start a home study later this year with hopes to garner FDA clearance for at-home use of its portable dialysis system by 2023, which Milad described as a “tremendous opportunity.”
Unlike conventional dialysis machines, which are bulky, complex and require a highly specialized operator, the SC+ system is small enough to fit on top of a cart or tabletop. The SC+ is easy to use and requires less than six hours of training compared to conventional systems that require 24 to 48 hours of training, according to Milad.
Yet, Milad stressed, it delivers the performance and dose equivalence of larger, traditional dialysis systems. Additionally, Quanta’s companion water purification module works with SC+ as an all-in-one mobile stack, which allows dialysis treatments to be delivered at home or other settings with a standard water supply, which makes it flexible.
Quanta hopes to become a leader in the growing dialysis market, projected to exceed $12bn in the US alone, as it shifts toward home-based dialysis care. The European market offers a similar opportunity, he said, but is structured very different from the US with multiple different health systems.
Milad pointed out that in the UK, the National Health Service (NHS) has been progressive in the adoption of home therapies.
“Hemodialysis already represents about 5% of the patient population – so about 1,500 patients in the UK are already doing home-based hemodialysis. In the US, by contrast, only 2% of patients are doing home hemodialysis. But because it is a much larger market, it still represents 10,000 patients today,” he explained.
The US represents the largest market opportunity with more than 500,000 patients on dialysis, a process of mechanically cleaning blood typically three times a week.
He said Quanta’s offering will fit “comfortably” with reimbursement parameters already in place in the US. Last November, the Centers for Medicare and Medicaid finalized policies that allow “certain new and innovative equipment and supplies used for dialysis treatment of patients with end-stage renal disease (ESRD) in the home to qualify for an additional Medicare payment.”
The final rule encourages the development of innovative home dialysis machines to give Medicare beneficiaries with ESRD more dialysis treatment options in the home and improves quality of life by not having to travel to a facility to receive their dialysis at least three times a week, CMS wrote. The ESRD model went into effect on 1 January. (Also see "CMS Final Kidney Disease Treatment Model To Encourage More Home Dialysis" - Medtech Insight, 18 Sep, 2020.)
“And we will be pricing our products in a way that’s competitive with our peers,” Milad added.
The company is also working on a cloud-based digital health program that will capture treatment data from the dialysis machine and connect it to patients’ electronic medical records. Quanta is also developing a patient and clinician portal. (Also see "Expanding Medicare Coverage For Digital Health Technologies Gains Support" - Medtech Insight, 11 Mar, 2021.)
Milad said the pandemic has facilitated rapid change in terms of rising adoption of remote monitoring and telehealth tools by clinicians and patients spurred by legislation for telehealth reimbursement.
“There have been a lot of titanic shifts that have been very favorable for us while at the same time we’ve been working really hard for 10 years to perfect a solution that addresses some of the unmet needs of dialysis ... which make it possible for the delivery of dialysis to occur in a wider range of locations to support some of the providers who are looking to bring on new models,” Milad said.