CHARLOTTE, N.C. — NewHope Bariatrics, a startup focused on tackling the exploding problem of obesity in the United States, has $18.5 million in new financing to serve as a war chest.
NewHope has plenty of opportunity for growth, too. The latest statistics from the federal government estimate that more than 60 percent of all adults are overweight, and of those more than 30 percent are obese.
The company, which was founded by two former top officials at MedCath in 2005, plans to use the funds to open surgery centers that will offer treatment for obesity.
NewHope Bariatrics will focus on a type of surgery known as LapBand. The procedure involves the use of gatric bands.
Bariatric comes from the Greek words for weight and treatment. Bariatric surgery involves sealing off most of the stomach to reduce the amount a food can eat or rearrange the small intestine to reduce the amount of calories a body can absorb.
The $18.5 million is divided between debt and equity financing.
Square 1 Bank, which is located in Durham, N.C. and provides debt financing to startups, is among NewHope’s backers. Austin Ventures and Versant Ventures also invested.
The company is run by David Crane, a former chief executive officer at MedCath, and Dennis Kelly. He also worked at MedCath, a Charlotte-based operator of hospitals focused on cardiovascular care. Both Crane and Kelly helped take MedCath public.
“We are gratified that diligent investors at this level think so highly of both our strategy to create centers of excellence and the extensive industry experience of the management team we have assembled,” Crane said in a statement. “This financing affords NewHope Bariatrics the opportunity to bring to the U.S. market our new vision of healthcare and the latest technologies that promise a new hope for those suffering from obesity.”
NewHope is already working with a number of physicians groups in anticipation of opening the surgical centers.
“In speaking with physician groups, we have been very pleased with the enthusiastic response to our business model and market approach,” Kelly said. “With our doctors as partners, we are now well on our way to realizing the NewHope vision.”
The use of bariatric surgery to combat obesity soared to some 175,000 procedures in 2005, according to the American Society for Bariatric surgery. That’s more than eight times the number of procedures in 1999. Of the 2005 total, 25,000 were gastric banding procedures — an increase from 6,000 in 2002.
NewHope Bariatrics: www.newhopebariatrics.com
