Manchester-based Phagenesis has raised £33 million in a Series D funding round.

The medical device company specialises in the treatment of swallowing disorders and the round was led by EQT Life Sciences and co-led by Sectoral, with new investors Northern Gritstone, British Patient Capital and Aphelion.

Patients with swallowing dysfunction (dysphagia) are unable to safely or effectively eat, drink, or manage their own saliva.

Dysphagia can often lead to life threatening complications such as pneumonia and is also associated with substantially higher healthcare costs

Phagenesis has developed cutting-edge therapy, Phagenyx® a neurostimulation system that targets and restores the neurological components of swallowing coordination and control that are disrupted due to brain injury (including stroke) or because of prolonged mechanical ventilation.

With the recent approval of Phagenyx® by the FDA in the US, the investment is primarily intended to support commercialisation in the US and deepen commercialisation in Europe.

It will also support clinical trials, regulatory activities, as well as research and development of pipeline products.

Northern Gritstone has made a £5m Series D investment into Phagenesis while British Patient Capital has committed £5.5m through its Future Fund: Breakthrough programme and co-investment programme.

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Northern Gritstone CEO, Duncan Johnson, said: “We are very pleased to be investing in Phagenesis. Bringing relief to patients with neurological dysphagia is a much-needed scientific advance. With IP originally from the University of Manchester, Phagenesis is an example of a great team building on the amazing science and technology that comes from the North of England exemplifying Northern Gritstone’s ‘profit with purpose’ philosophy.”

Ian Connatty, managing director, direct & co-investment, British Patient Capital, said: “Phagenesis has built a leading solution for patients suffering from dysphagia.

“Their technology has the ability to deliver great results for patients whilst also delivering healthcare savings. We are delighted to support them as they take the next steps in their growth journey.”

Phagenesis CEO, Reinhard Krickl, said: “Our novel and proven therapy can help the millions of patients every year who suffer from swallowing disorders.

“While we are still headquartered in the UK, we will now invest in exceptional international talent to scale up our global customer outreach and to support passionate clinicians who want to bring our therapy to those millions of patients who suffer from dysphagia every year.”

Krickl said said raising $42m was all the remarkable given the difficultly in the current economic environment.

“Raising money into a market with yet unproven economic value makes it even harder,” he said. “Our $42m raise recognises the huge unmet medical need of early treatment of swallowing dysfunction (dysphagia) and the  game-changing potential of our Phagenyx® neurostimulation treatment.”

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