Atlanta’s growing medical technology industry is getting a major shot in the arm.
EndoChoice, an Alpharetta-based company that sells endoscopy devices, said Friday it plans to merge with an Israeli-based medical firm in a deal that would create 200 new jobs, mostly in metro Atlanta. The company also announced it raised $43 million from a well-known Silicon Valley venture capital firm, Sequoia Capital, to fuel its growth.
The combined company will remain headquartered in Alpharetta, but will reach far beyond Georgia. A research and design center will be housed in Caesarea, Israel, and a manufacturing plant is to be established in Germany.
“We’re taking an already successful business and adding game-changing technology and adding new investment,” said Mark Gilreath, the EndoChoice chief executive, who founded the firm in 2008. “This is going to be great for Atlanta.”
EndoChoice has grown rapidly since humble beginnings five years ago in Gilreath’s garage. It has about 200 employees - including about 150 in metro Atlanta - and was hungry to broaden its portfolio.
The merger with Peer Medical Ltd. will help it do just that. The Israeli firm developed a video system and endoscopy device that helps doctors greatly expand their vision during scopes to detect more cancerous polyps and other risks. Peer Medical’s chief executive, Avi Levy, said he hopes the merger helps “commercialize this breakthrough technology.”
The Sequoia investment, though, may have even broader implications. The California venture fund has backed some of the most powerful technology companies on the globe, from Apple to YouTube, and industry experts hope the firm’s bet will spur interest in other Atlanta startups.
“When Sequoia makes an investment, other large funds will look at the deal and wonder why they missed it,” said David Hartnett, a Metro Atlanta Chamber vice president. “They’ll get on a plane and comb the area for other business potential.”
It comes as Georgia marketers pitch Atlanta as a center for global health and a growing hub for medical device companies. There are about 500 such firms based here and they employ more than 25,000 people, said Hartnett, and the industry is growing about 15 percent a year despite the economic slowdown.
“At the end of the day, the medical device investment community will have its eyes on Atlanta after this deal,” said Hartnett.
