HeartFlow, Fogarty Innovation’s first company-in-residence, is also its first graduate to go public. The company did this through a special purpose acquisition company (SPAC) merger with Longview Acquisition Corp. II valued at $2.4B, with an estimated $400 million in cash after closing. HeartFlow is expected to be listed on the New York Stock Exchange under the symbol “HFLO.”
The funds will be used to support the company’s mission to transform the way heart disease is diagnosed and treated, specifically to accelerate adoption of the HeartFlow Analysis, the first and only non-invasive tool to assist with the diagnosis, management and treatment of patients with heart disease. As the most common type of cardiovascular disease, it accounts for one in three deaths and $1 out of every $6 of U.S. healthcare spend, according to the CDC Foundation.
HeartFlow’s path to going public
Going public is the dream of many entrepreneurs, but requires perseverance and a sound strategy, in addition to an innovative idea. “Developing the company required attention to many facets, including the technology itself, but also the clinical, commercial, quality and regulatory sides,” says Charles (Charley) Taylor, Ph.D., co-founder, chief technology officer and member of the board of directors, who worked alongside the other co-founder, Chris Zarins, MD, during the early concept days at Stanford and later at Fogarty Innovation.
One of the key goals was to ensure the company was well-capitalized in order to grow it to where it is today. HeartFlow raised more than $100 million in 2014, another $100 million in 2016 and a $240 million Series E round in 2018. He gives CEO John Stevens the lion’s share of the credit for ensuring the team had investors who were as committed as they were to bringing its signature product forward.
“We are at a point where we feel that the investment infusion from being a public company would enable us to further accelerate our growth and position ourselves for the long-term, which will have benefits for employees and shareholders, but most importantly patients,” Charley says. “It gives us a stage to share our unique solution and our larger role in successfully shifting the diagnostic pathway for heart disease in the marketplace.”
When the company reviewed the different pathways to becoming public — the traditional IPO versus the alternative SPAC merger option — the decision ultimately was made when they found the ideal partner in Longview Acquisition Corp. II. “Longview’s goal is to work with companies who do more for less — as in, provide better healthcare at a lower cost — which is what we have strived for since our inception. Our focus has always been on providing a better solution for physicians to diagnose and care for patients with heart disease, and I’m very proud we have built our company culture around this.”
Charting a course for the future
The HeartFlow FFRCT Analysis has been the company’s core product, helping physicians diagnose heart disease and identifying patients who needed cardiac catheterization, rather than being treated with medical therapy. HeartFlow will accelerate the commercialization of its HeartFlow Planner, which allows interventional cardiologists, for the first time, to plan ahead for their cath lab procedures by allowing them to modify the computational model to simulate different treatment scenarios in advance of such interventions.
In addition, HeartFlow is developing additional products, which will provide a richer set of anatomic information that will help cardiologists and radiologists read the coronary CT data more accurately, efficiently and non-invasively.
The additional financing from the merger will also enable them to explore opportunities in both new and existing markets for these products, ultimately allowing them to offer a full spectrum of non-invasive products for diagnosing and managing CAD and impact more patients’ lives faster.
Through all the successes, the team has learned several important lessons. The foundational element in any company is not only understanding your potential clinical impact, but also having the courage to disrupt the status quo and the endurance to push forward. “Staying focused on your mission will help with the difficult times. I believe we need to do a better job of providing more innovation and a better quality of healthcare to a larger number of people,” Charley says. “If the status quo isn’t adequate, it needs to be replaced, and when we think we have a better solution, we have a responsibility to take action, gather the evidence and move it forward.”
He also cites the importance of working together as a team, which includes not just his colleagues at HeartFlow, but also the investors and physicians they work with, in addition to the pioneers at Fogarty. “I feel very grateful for the early years we had at Fogarty Innovation and the chance to get to know Tom, who’s such an inspiring figure,” he said, adding that it’s been exciting to watch the Fogarty organization grow as well.
Finally, Charley recalls something Tom instilled in him from the beginning: “While it’s definitely very challenging to carve a new pathway, it’s also incredibly rewarding knowing the positive impact you can have.”