GI Dynamics Gains $15 Million to Help Patients Lose Weight

2/9/09

GI Dynamics has tapped previous investors to add $15 million to its third round of venture capital, giving the Lexington, MA-based firm more cash to develop its intestinal liner for the treatment of obesity and Type 2 diabetes. The company confirmed news of the financing, which was reported this morning by PE Hub. The new cash comes on top of $30 million that GI Dynamics raised in the first close of the Series C round in 2006.

The financing follows the medical device firm’s announcement last month that it received clearance to begin sales of its so-called EndoBarrier—a sleeve that lines a section of the small intestine to block calorie absorption—in Europe. CEO Stuart Randle, who declined to be interviewed this morning, told me last year that the company planned begin talks this year with the FDA about the design of a pivotal trial for the EndoBarrier. Also, late last year the company revealed that a small clinical trial with 37 patients showed that the device helped patients drop an average of 30 pounds.

GI Dynamics has raised a total of more than $60 million since it launched in 2003 with technology developed by former Boston Scientific (NYSE:BSX) engineer and GI Dynamics chief technology officer Andy Levine. For the latest financing, GI Dynamics attracted investments from return backers Advanced Technology Ventures, Cutlass Capital, Domain Associates, Johnson & Johnson Development, Polaris Venture Partners and Seedling Enterprises, according to PE Hub.

Coincidentally, I noted GI Dynamics in a story I posted this morning about the Greater Boston diabetes cluster.

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