Sotera Wireless, one of the earliest stalwarts of the digital health space, filed for Chapter 11 bankruptcy last week in a Southern California court, saying that it did not have enough funds to pay a wide range of debts. Mass Device first broke the news.
The company said in a filing that it has about $2.4 million in cash and owes more than $13 million to creditors, including Silicon Valley Bank and Oxford Finance. Some of that debt is from legal fees associated with a trade secrets case leveled against the company by competitor Masimo, but the company has also failed to pay inventory suppliers Zhonghuan Hi-Tech Corp and Nortech Systems.
According to Mass Device, the company has been looking to either sell or refinance its loans, but wasn't able to make a deal in time to keep up with its debts.
Originally founded as Triage Wireless in 2004, Sotera took on its new name in 2009. The company's claim to fame was a wireless continuous blood pressure monitoring technology that did not require an inflatable cuff. The company raised more than $84 million in equity investments over the years, most recently in April 2014. That round turned out to be at least in part provided by Taiwan-based electronics manufacturer Foxconn.
Sotera Wireless got FDA clearance for its ViSi Mobile monitoring system in 2012. The following year the company seemed poised to make it big with a string of high-profile partnerships including Scripps Health, Palomar Pomerado Health, NASA, and Intermountain Healthcare. Sotera got an updated FDA clearance for a fall-detection algorithm last year.
The bankruptcy filings indicate that Sotera technology is now operating in 45 hospitals, and the company has sought relief from its debts so it can use its remaining cash to support those deployments while it continues to search for a buyer. MobiHealthNews has reached out to Sotera Wireless for comment and will update this article if we hear back.