REVA Medical has filed for Chapter 11 relief in the United States Bankruptcy Court for the District of Delaware, weeks after warning a cardiology group's bioresorbable scaffold guidelines had hurt sales.
The bankruptcy is intended to enable San Diego-based REVA to step back from percutaneous coronary intervention to focus on peripheral interventional and embolics products.
REVA pinned its failure to grow sales of its bioresorbable scaffold on the European Society of Cardiology’s preference for conventional drug-eluting stents.
In August 2017, an ESC task force concluded that the five bioresorbable scaffolds then available in Europe either lacked published randomized clinical trial data or appeared to be inferior to standard drug-eluting stents. That position led the task force to recommend physicians use drug-eluting stents until bioresorbable scaffolds undergo medium-sized, randomized trials against the standard of care.
A little more than one year after the task force published its recommendations, REVA introduced a new bioresorbable scaffold it claimed to be better than existing devices such as Abbott’s Absorb. However, REVA failed to persuade physicians to widely adopt the new device.
Last month, REVA projected $300,000 in revenue for the fiscal year, adding that it expected sales to grow at a “modest” rate. The commercial failure of the bioresorbable scaffolds, called Fantom and Fantom Encore, left REVA owing $1.2 million with just $1.3 million in the bank. REVA expected to need at least $10 million to get through 2020.
Those figures have added up to a bankruptcy filing. Ahead of the Chapter 11 filing, REVA entered into a restructuring agreement with its lenders. The restructuring is intended to pivot REVA away from the use of bioresorbable scaffolds for percutaneous coronary intervention.
“While the clinical outcomes data from the company’s Fantom and Fantom Encore bioresorbable scaffolds remains excellent, BRS adoption has been greatly impacted by concerns with clinical data from inferior competitive devices. As a result, we are focusing on opportunities in the peripheral interventional and embolics market segments,” REVA president Jeffrey Anderson said in a statement.
REVA aims to emerge from the bankruptcy process as a standalone company focused on its existing peripheral vascular business and the development of its embolics franchise. In 2018, REVA received a CE mark for a bioresorbable scaffold, branded MOTIV, in below-the-knee peripheral artery disease.