INDIANAPOLIS, Indiana (June 15, 2021) – – Last month, when SonarMed announced it had been acquired by Medtronic, a global leader in medical technology, VisionTech Angels investors had much to celebrate. Ten years earlier, the group’s members were among the first to invest in the Carmel-based life sciences startup.
Founded in 2005, SonarMed is the creator of the AirWave™ Airway Monitoring System that addresses critical airway management challenges, thereby addressing an enormous unmet need in premature infant, pediatric and adult patient populations in critical care, emergency departments and operating rooms. SonarMed’s technology was originally created as a graduate level project of Jeff Mansfield, M.D, SonarMed chief technology officer, and Eduardo Juan, M.D., at Purdue University. Medtronic has commercialized and is now marketing the technology.
Angel investing is a high-risk game, particularly in the life sciences space where innovative technologies must meet stringent clinical and regulatory criteria before a commercial launch. VisionTech, like other angel investing groups, gets involved in early stage companies, providing capital and business advice and in the process, forming close relationships with company founders. SonarMed is one of the first investments made by VisionTech, which was founded in 2009.
Managing Director Oscar Moralez explains what VisionTech Angels saw in the startup and their device. “As an Indiana-based angel network, we wanted to support regional innovation and particularly startups coming out of our research universities like Purdue. Our group also is attracted to life sciences startups.
Moralez also had a personal interest. One of his children had been born three months prematurely, requiring a stay in a neonatal intensive care unit (NICU) to address breathing issues among other things. “I immediately connected to SonarMed and what their technology would mean for these high-risk babies and their families.”
VisionTech Angels members made their first investment in SonarMed in 2010 and ultimately invested in multiple rounds over the next decade because of the belief the technology could help save lives.
Tom Bumgardner, who served as CEO of SonarMed prior to the acquisition, explains the company’s AirWave Airway Monitoring System. “Our device is the only FDA-cleared airway monitoring system for patients like premature infants who can’t breathe on their own and truly challenges the status quo in critical care and anesthesia when used for detection of endotracheal tube movement, obstruction and placement. Clinicians using our device see better outcomes, which means fewer injuries, less time in the hospital, lower costs, and less heartache.”
SonarMed also received early support from other high-profile Indiana investment groups, including Elevate Ventures, Indiana Economic Development Corporation and BioCrossroads. As the company and its technology progressed, other investors came on board at critical junctures: Hyde Park Angels, Baylor Angel Network, Central Texas Angel Network, Queen City Angels, and others. Nondilutive funding in the form of grants from the National Heart, Lung, and Blood Institute of the National Institutes of Health and the Indiana 21st Century Research and Technology Fund also contributed to the development of the AirWave device.
Bumgardner acknowledges it “took a village” to elevate SonarWave and its technology. “We give a tremendous amount of credit to our early stage investors who took a leap of faith that our technology could change the course of airway management and that there was a market for it,” he said. “They stuck with us as mentors, advisors, and cheerleaders and never gave up.”
Medtronic, with its extensive market presence, clinical leadership and market development expertise, was the ideal acquirer of SonarMed and the AirWave device, which is approved for use in the United States and the European Union. Medtronic is now actively rolling out the SonarWave device.
VisionTech Angels has had three portfolio companies successfully exit over the last year. However, the SonarMed deal is particularly sweet for Moralez and VisionTech Executive Director Ben Pidgeon.
“SonarMed is part of the VisionTech family; we literally grew up together, improving year by year,” Moralez says. “The financial reward of the exit is just part of it. Knowing we also played a role in supporting an innovative respiratory device that will help address a top patient safety issue for the most vulnerable patients, premature infants through adults, around the world is the real ROI.”