Germantown-based medical device startup Somna Therapeutics LLC has increased the goal for its current funding round to $2 million after raising $1.7 million so far.
The company makes a device called the Reflux Band that is worn around the neck at night to prevent acid reflux. The device, which is contract manufactured in Minnesota and Texas, was originally named after its inventor, Dr. Reza Shaker, chief of Gastroenterology and Hepatology at the Medical College of Wisconsin. This summer, Somna changed the name to make its purpose clearer to consumers.
Founded in 2012, Somna has raised a total of $7 million in three previous funding rounds. It was working this summer to raise $1.3 million, but upped the goal recently, said Nick Maris, president and chief executive officer or Somna.
“We decided to increase this round slightly as we wanted to take advantage of the significant interest that we are experiencing since we launched our non-prescription Reflux Band. Our web traffic is 10 to 15 times higher than our best estimates,” Maris said.
Somna has experienced the increased interest since it received approval from the FDA in May to sell its Reflux Band over the counter. It was previously available only by prescription. The funding round will be used for Somna’s OTC rollout, Maris said.
Among the investors in the new round, which Maris expects will close in January, are health care-focused Madison venture capital fund 30Ventures ($500,000) and University of Wisconsin alumni investment fund Bascom Ventures ($200,000). Earlier investors have also reinvested in this round, though Maris declined to name them specifically.
“We are very excited to participate in the Somna Therapeutics financing and feel confident that the Reflux Band will make a real difference for millions of acid reflux sufferers,” said George Arida, managing director of 30Ventures. “The Reflux Band also can significantly reduce health care costs associated with acid reflux, as more than $18 billion is spent on (medications used to treat acid reflux) each year. Our due diligence convinced us that the Reflux Band will have a very meaningful impact and we’re excited to help provide reflux sufferers with this innovative and cost-effective product.”
Maris plans to hire another three employees in 2019, bringing Somna’s total employee count to seven. Consumer demand has increased significantly since the company launched OTC sales in September, he said.
“It’s really all systems go on our marketing directly to consumers,” Maris said. “Our unit sales have gone up tenfold from prior months.”
Somna also recently reduced the price of its Reflux Band from $169 to $99.
“We are testing different price points over the next year as we continue to do our best to bring the Reflux Band to those suffering from acid reflux at the best value possible,” Maris said.
