Rush Limbaugh powers Envoy Medical to new fame, investors

Rush Limbaugh

Envoy Medical Corp. should send Rush Limbaugh a fruit basket.

Thanks in large part to Limbaugh’s plug on his popular radio show, Envoy in White Bear Lake, Minnesota, recently raised another $16.4 million, including $10 million from hearing aid powerhouse Starkey Laboratories Inc., for its implantable hearing device, Esteem.

The latest financing round, which closed at the end of September, brings Envoy’s total take to $140 million.

In addition, Limbaugh’s millions of listeners have flooded Envoy’s website and phone lines, prompting the startup to hire more sales staff.

“It’s been off the charts,” CEO Patrick Spearman told MedCity News. Limbaugh “is worth every penny” of the $250,000 a month advertising deal his company has with the conservative talk show host.

Not that Envoy necessarily needed more buzz. Since the Food and Drug Administration approved its Esteem system in March — the first fully implantable device to treat hearing loss in the United States — the company has been busy.

About 90-to-100 surgeons are training to implant the device, including doctors from Mayo Clinic, Harvard University and Yale University, Spearman said. Ten surgeons ready are to perform the procedure over the next month.

Spearman estimates 80 patients have signed up for the $30,000 out-of-pocket procedure with another 400 expressing “serious interest.”

The Esteem device is located entirely in the ear. The system consists of a sensor, sound processor and driver. The sensor picks up vibrations from the ear drum and converts them into electric signals. The sound processor — a specially designed computer chip — cleans up the signals and boosts their power. Finally, the driver converts the signals back into mechanical vibrations and transmits them to the cochlea.

If Envoy can sell 110 procedures a month, the company would generate positive cash flow by March 2011, Spearman said.

Apparently, one of Envoy’s best moves was reaching an advertising deal with Limbaugh. For the last eight weeks, Limbaugh has pushed the product on his show and website.

As a result, traffic to Esteem’s website has jumped to 2,800 hits a day from 500 to 1,000 hits. The company has hired extra sales staff just to handle the volume.

Getting Limbaugh to promote a product is no easy task. He accepts only one in 11 advertisers that make a pitch. Spearman said he met Limbaugh for two hours and walked away impressed.

“He is a very gentle person,” Spearman said. “Very kind. He is an incredible listener. He has an incredible memory.”

Exposure from Limbaugh’s show helped Envoy land the $10 million investment from Starkey, one of the world’s largest manufacturers of hearing aids, based in Eden Prairie, Minnesota.

The alliance should benefit both companies — Envoy could refer customers to Starkey, and vice-versa, Spearman said.

Envoy’s other investors include Minnesota Timberwolves owner, billionaire Glen Taylor; Roger Lucas of biotech firm Techne Corp.; and former Medtronic Inc. vice chairman, Glen Nelson. Former Boston Celtics great, Kevin McHale — Spearman’s brother-in-law — also chipped in $400,000.

Thomas Lee

Thomas Lee was the Minnesota Bureau Chief for MedCityNews.

more

Tags: dealflow, Envoy Medical, medical devices, Minnesota, Starkey Laboratories, U.S. Food and Drug Administration

Comments Post a comment

awesome! Need a like button on MedCity News…

Comment by frank jaskulke — October 7, 2010 @ 4:03 pm

Wow! I have had two stapedectomies, which were very successful but as I have gotten older I have had to start wearing hearing aids. I am wondering if I would be a candidate for this procedure. Thank you.

Comment by bonnie lou kunkle — October 12, 2010 @ 6:07 pm

Although I currently wear hearing aids, I am very interesting in getting the implantable Esteem hearing aids. I have a couple of questions: 1)Is there a doctor in Michigan qualified to do the surgery; and 2) Is any of the cost covered by my health insurance?

Comment by Shirley Vasileff — October 19, 2010 @ 4:59 pm

I have neurosensory hearing loss in my right ear. Conventional hearing aids will not help me at all. My doctor at OSU told me about the new implantable hearing aids that work off the temporal bone. Am I a candidate for this new implant.

Comment by Diane M Spalding — October 23, 2010 @ 7:03 pm

I am inquiring for my father as well as myself. My dad is 83 and really needs help in the hearing dept. Would the VA help with the cost of this procedure? Also, are both ears included in this cost?

Comment by Erwin Doublestein — November 30, 2010 @ 11:09 am

Would the VA help with the cost of this procedure?

Comment by Janice Cobble — December 28, 2010 @ 7:47 pm

I am 70% left ear and 80% in right. Would I need one in both ears. Will my medicare cover any of this cost.

Comment by Chuck Shelby — March 29, 2011 @ 7:15 pm

I’ve been diligently trying to get a loan for this procedure. There are almost no insurances that will cover the costs for the Esteem. $30K is a lot of money,but if I had it, I’d pay even more. Hearing aids are a pain in the butt. I cannot stand being out in public or trying to have conversations with people. If anyone knows of a way to get financing, please post.

Comment by Mary Lou — April 8, 2011 @ 3:03 pm

I have a medium hearing loss but being a Sr. citizen can’t afford the $30,000 price tag for this device. Anyone know of a cheaper one and where it can be obtained.?
I’m in Phoenix, AZ. I’ll have to stop and get me a lottery ticket so I can get this done. Thanks for any info.

Comment by Joann Bishop — June 17, 2011 @ 8:17 pm

I would love to hear the answers to the posted questions, since I have some of the same questions.

Comment by Carole Andrews — December 5, 2011 @ 3:09 pm

I had the esteem surgery 7 months ago and I did not benefit from it at all. I was told that I was the perfect canidate because of my loss. I did very well with my hearing aids but wanted more because of my two young children. Now I am worse than I ever was. I have trouble understanding people if the esteem device is on. It sounds like a very bad hearing aid. I have been promised a lot and so far I am very disapointed. This has had a negative impact on my life. Talk with your audiologist before you do anything!!!!

Comment by Jenifer — December 24, 2011 @ 12:43 am

I’m frustrated with the partial cochlear implant. It’s bulky, cumbersome, conspicuous, feels heavy on the ears, and etc. There are serious lifestyle limitations, also. That means no swimming in the ocean with cochlear implants. I can’t believe that they can easily make Totally Implantable hearing aids (like the Envoy) and do nothing for Totally Implantable cochlear implant.

cochlear implant user

Comment by Bionic user — January 6, 2012 @ 10:24 pm

The Envoy Medical did acquire the All Hear single electrode cochlear implant years ago. I thought that the Envoy Medical was going to start clinical trials with the Fully Implantable cochlear implant somewhere around 2009-10. I don’t know what happened to that.

Comment by Businessman — May 14, 2012 @ 3:57 pm

Rush Limbaugh powers Envoy Medical to new fame, investors

Thomas Lee

Comments Post a comment

Post a Comment

Be a Thought Leader: Join MedCitizens