Satiety Raises $30 Million for Obesity Device

Satiety, a six-year-old Palo Alto, CA, company that’s working on a device that restricts how much food the stomach can hold, has raised $30 million in a Series D financing, The Deal reports. The money, which brings the company’s investment total to over $50 million, will be used to fund U.S. clinical trials to begin later this year.

Unlike gastric bypass and banding, Satiety’s product is non-invasive. It’s a vacuum device that’s inserted orally. Once eased down the throat, it grabs at the stomach walls and staples them to create a smaller pouch.

John Freund, a managing director with Skyline Ventures, which led the Series D round, told The Deal that Satiety’s non-invasive approach may give it an edge over gastric bypass and other bariatric procedures. “The mechanism of action of the device substantially duplicates more invasive procedures that are known to work,” said Freund, “and we easily anticipate that this could be done by a much broader group of physicians.”

According to the American Society for Metabolic and Bariatric Surgery via The Deal, there were 177,600 bariatric surgeries performed in the U.S. in 2006, up 4.7% from 170,000 in 2005, and up 160% in the last five years.

Satiety CEO Greg Patterson told Red Herring back in April that the company is looking toward a European approval by the end of this year — still a viable goal, according to The Deal piece from this week. The news magazine reports that Satiety is now wrapping up clinical studies in 44 patients outside the U.S.

In May, Satiety was named to the Red Herring 100, Red Herring annual list of most promising startups.

Along with lead investor Skyline Ventures, HLM Venture Partners, Pinnacle Ventures, Venrock, Morgenthaler Ventures and Three Arch Partners participated in this latest financing.

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