These have been troubled times for spine device company Baxano Surgical, Inc., as it has been trying to rescue itself from a perilous financial position. Back in late September Baxano dragged in $1.5 million that it said “extended its cash runway” for a while, but the news that it has now filed a voluntary petition for relief under Chapter 11 of the U.S. Bankruptcy Code might suggest the runway’s end is approaching.
Baxano Surgical Inc., was formed when that other spinal device company TranS1 acquired Baxano, Inc., eighteen months ago. The combined company promised much as it focused on designing, developing and marketing minimally invasive products to treat degenerative conditions of the lumbar spine.
Now however the Company has filed a voluntary petition for relief under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware. The bankruptcy filing was effected in order to facilitate a going concern sale of the Baxano Surgical minimally invasive products under Section 363 of the Bankruptcy Code.
What happens next is that the front line of commercial operations will continue for the time being as Hercules Technology Growth Capital, Inc., Baxano Surgical’s pre-petition secured lender, has agreed to provide “debtor in possession” financing on the terms set forth in the applicable loan documents and subject to Bankruptcy Court approval to support Baxano Surgical’s continued operations during the pendency of the sale process.
Accompanying the release came news that CFO Timothy Shannon and 2 board members had resigned.
“We believe this is the best course of action for the company at this point in time and is in the best interests of all of our stakeholders,” stated Ken Reali, President and CEO of Baxano Surgical. “As we move through this transaction process we will continue to focus on supporting our commercial business and the surgeons and hospitals that use our products.”
Source: Baxano Surgical, Inc.