Ray leads Surginetics into electrosurgical market

BOULDER – Longtime medical devices entrepreneur Paul Ray has launched Surginetics LLC, a developer of electrosurgical products.

Ray is chief executive, and Bill Hunter is chief operating officer of the seven-employee company that is developing and manufacturing disposable electrode blades that could be used by surgeons.

Using venture funds secured in March, Surginetics acquired the intellectual property of Boulder-based Team Medical LLC, which holds nine patents and has filed 13 patent applications that can be used in electrosurgical devices.

Surginetics closed a $1.8 million series A round March 28 provided by four venture funds led by Boulder-based High Country Venture using funds from the Colorado Fund I. Private investors also contributed. High Country accounted for $750,000, said partner Mark Lupa.

High Country manages the Colorado Venture Capital Authority’s state-backed investment fund called Colorado Fund I. The authority was created in 2004 by the Colorado Legislature to invest in early-stage high-tech companies.

Warren Heim, who was president and principal engineer of Team Medical, is a major shareholder in Surginetics and as chief technical officer is overseeing research and product development.

Surginetics has two products waiting for Food and Drug Administration approval. Lupa said if approved, the products could be on the market by the end of the year.

The two products are the AdvantageBlade and the AdvantageBlade Bipolar.

Basically, these instruments look like a pencil with an extension cord at one end and a one-inch electrode blade at the other. Electrical energy is sent to the blade for cutting and coagulation of tissue.

Hunter said the AdvantageBlade can be used with any existing power source, and its patented Focus Power technology includes a coating that isolates the electric current to only the cutting edge of the blade, eliminating the possibility of cutting tissue when touched by other parts of the blade.

The Bipolar version creates a complete circuit of electrical current from the power source through the blade and back to the power source, eliminating potential burning of skin tissue.

Hunter said the coating also reduces the buildup of coagulated blood and dead tissue on a blade.

Disposable electrode blades generally sell for between $3.75 and $4 each. Hunter said Surginetics hasn’t set a price yet for its blades, but he said it would be a “premium price” because of their advantages.

Ray pointed out that the electrosurgical device market is about one-half billion dollars annually worldwide, and includes Valleylab, which has operations in Boulder, New York-based ConMed Corp., which has an electrosurgery facility in Centennial, and Megadyne Medical Products Inc. based in Draper, Utah.

In mid-2004 Ray helped launched Nervonix, a Bozeman, Mont.-based medical imaging company that has its headquarters and engineering facilities in Longmont.

Ray is the former director of the Office of Life Sciences and Biotechnology in the state of Colorado’s Innovation and Technology office and has headed several medical technology companies including Boulder-based Image Guided Technologies Inc., which was sold to Stryker Corp. for $15 million in 2000.

Managing Editor Doug Storum contributed to this report.

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