SAB Foundation invests R28 million in start-up medical device development company
First South African foundation to use endowment funds for impact investment
The SAB Foundation has today announced it’s the investment of R28 million in start-up LIQID Medical, a medical device development company pioneering a new class of sight-saving ocular implants.
“We are proud to be the very first foundation in our country to use its endowment for impact investment,” says Director of the SAB Foundation, Bridgit Evans. “The aim of this is to leverage traditional capital pools toward solutions that address key socio-economic challenges of inequality, unemployment and poverty.”
“The SAB Foundation was set up as part of the South African Breweries’ (SAB) empowerment scheme and receives dividends bi-annually,” she continues. “A portion of these dividends were invested in our endowment, and we will be using funds from those investments to fund the transaction, which represents a 15.6% shareholding in this business.”
Based in Cape Town, which is emerging as a major technology hub LIQID Medical was previously awarded R1.3 million in funding and mentorship as winner of the foundation’s annual Disability Empowerment Awards in 2019. The company has also received cash funding from local and international scientific awards; government grants and loans; and private equity investments.
The patented devices have been designed to harness a naturally occurring anatomical mechanism to provide the most clinically effective, cost saving, and quality-of-life-improving solutions for glaucoma, a leading cause of global blindness. Currently there are three core devices under development, which are the OptiShunt, iPortVR, and iFlow.
Founder, Dr Daemon McClunan, is an eye specialist who has been working on the development of these devices since 2015. Following its most recent investment of R9.5 million from the Technology and Innovation Agency of South Africa, the R28 million equity funding investment from the SAB Foundation is earmarked for technology development, regulatory accreditation, clinical trials, and IP portfolio development over a period of three years.
“Our goal is to be commercialisation ready by the end of the funding tranche,” explains McClunan. “Commercialisation, followed by launch to market, is expected three years after the investment. This is driven by the company concluding further clinical trials and securing international regulatory approvals within the target period.”
According to research conducted by IDF Capital, the global glaucoma treatment market is R140 billion per annum, with a compound annual growth rate of 6.9%. The total number of patients globally with glaucoma is 76 million, with the total revenue generated per annum from device sales being R26 billion. In addition, the total number of glaucoma surgical procedures performed per annum is one million.
Currently, the most effective means of treating glaucoma involves draining excess fluid from the eye via the traditional drainage pathway by implantation of a tube-shunt device. A more effective treatment solution has never been developed until now. LIQID Medical has developed three patented glaucoma implants, each designed to fill three clearly defined gaps in the market.
“As a foundation our ultimate objective is to support social innovators to develop their businesses, that will in turn boost the local economy and create jobs,” says Evans. “This investment is asignificant opportunity to mobilise capital into investments that target measurable positive social, economic, or environmental impact alongside financial returns. We look forward to seeing more foundationssupporting the development of impact investment.”