Palmaz Scientific Announces Chapter 11 Filing; Seeks Prospective Buyers for Its Breakthrough Technology
March 04, 2016 08:41 PM Eastern Standard Time
SAN ANTONIO--(BUSINESS WIRE)--Palmaz Scientific, Inc. today announced that the Company filed for Chapter 11 protection in San Antonio to provide adequate time to identify and evaluate prospective buyers for its innovative metallurgical medical device technology.
Dr. Julio Palmaz and others founded the company in 2008 to develop the next-generation of safe implantable prosthetic devices. Two decades earlier, Dr. Palmaz invented the first commercially successful balloon expandable heart stent, the Palmaz® Stent, which has been hailed as one of the 10 inventions that changed the world and is credited with saving millions of lives. Dr. Palmaz envisioned that Palmaz Scientific's new technology could revolutionize care for strokes and other life threatening conditions in the same manner that the Palmaz® Stent did for cardiac care. The Company owns or controls more than 250 issued patents and has many other active patent filings in progress.
Despite the game-changing potential for this new technology, the Company asserts that its ability to attract capital investment and continue its business operations has been seriously impaired by a negative campaign of false information disseminated by certain individuals about the Company. Litigation involving these false charges was brought by and against the Company in 2015. The Company seeks millions of dollars in damages.
According to the Company, the false information was provided to current investors, potential business partners, the news media and even Federal government authorities – resulting in substantial damage to the Company and crippling its ability to maintain its ongoing operations. For example, the Company asserted that the misinformation prompted a Federal investigation by the U.S. Attorney's office in Dallas. The Company quickly and completely cooperated in the investigation and was cleared in a letter from the U.S. Attorney's office, which not only closed their investigation, but also praised the Company's timely and transparent response.
According to the Company, it suffered irreparable harm due to the spread of this so-called "information," with potential transactions and development projects with large medical device companies falling victim to the defamation campaign. The Company will vigorously pursue its claims.
Throughout this tumultuous time, the Company has been financially supported by the Palmaz family, the Company's largest shareholder. Demonstrating their belief in the Company's technology, the family has loaned the Company millions of dollars in the last year alone to preserve and further develop the technology and to identify strategic partners.
While potential suitors have expressed great praise for the technology, the Company believes that the toxic atmosphere created by the defamation and the related litigation prevented any meaningful investment. The Chapter 11 proceeding presents an opportunity to separate the valuable technology from the collateral effects of the defamation and litigation. The Company intends to market the technology and maximize its value.
The Company will have no further comment at this time.
Andy Taylor of Andy Taylor & Associates, P.C. represents the Company in litigation proceedings (www.andytaylorlaw.com). Michael M. Parker of Norton Rose Fulbright has been retained to represent the Company in Chapter 11 proceedings.
Dublin & Associates, Inc.
Jim Dublin, 210-227-0221