Silk Road Medical Raises $120 Million in IPO to Advance Novel Surgical Device for Stroke Prevention

VCBeat (WeChat ID: vcbeat) has learned that on April 8, 2019, medical device company Silk Road Medical announced the completion of a $120 million initial public offering (IPO) on the NASDAQ Stock Exchange, significantly exceeding its previously estimated $86.25 million. The proceeds will be used to expand its sales force and business scale, intensify research efforts, and conduct new clinical trials.

In March 2019, Silk Road Medical announced plans to issue 4.7 million shares at an offering price of $15 to $17 per share. J.P. Morgan Securities LLC and BofA Merrill Lynch served as joint book-running managers for the offering. BMO Capital Markets and Stifel acted as joint managers for the offering.

On April 4, Silk Road Medical officially listed on the NASDAQ under the ticker symbol SILK. Contrary to expectations, the company ultimately sold 6 million shares of common stock at $20 per share. On its listing day, the company’s stock surged 80.9% to $36.18 per share. Additionally, Silk Road Medical granted the underwriters a 30-day option to purchase up to 900,000 additional shares. If the underwriters exercise this option, the company will receive an additional $18 million. On April 8, Silk Road Medical completed its IPO financing, with total gross proceeds amounting to $120 million before deducting underwriting commissions and offering expenses. Currently, the company’s market capitalization stands at approximately $1.1 billion.

Silk Road Medical attracted significant investor attention following its public listing. IPOboutique.com, a U.S.-based IPO research firm that rates IPO companies on a scale of 1 to 5, assigned Silk Road Medical a rare top rating of 5. The previous IPO company to receive a 5-star rating was Facebook, which went public in 2012.

To date, Silk Road Medical has completed six rounds of financing, raising a total of over $160 million. In 2015, the company secured $57 million in funding led by CRG; in 2017, it closed a $47 million Series C round led by Norwest Venture Partners and Janus Capital Management.

Silk Road Medical, founded in 2007 and headquartered in California, USA, is a medical device company dedicated to developing novel surgical devices for stroke prevention, including Transcarotid Artery Revascularization (TCAR) systems. In 2018, Silk Road Medical generated $34.6 million in revenue, representing a 142% increase from the $14.3 million recorded in 2017.

Most strokes are caused by carotid artery stenosis, which prevents blood flow from reaching the brain. If carotid artery stenosis is not treated in a timely manner, blockages may travel to the brain, significantly increasing the risk of stroke. TCAR, developed by Silk Road Medical, minimizes vascular injury while protecting the brain. The device is designed to surgically remove plaque obstructing the carotid arteries and implant a stent to maintain unobstructed blood flow, thereby preventing stroke.

(Compiled by Jiao Yanli)