Earlens raises $87 million for hearing aid performance breakthrough

Earlens Corporation announced it raised $87 million in new capital to fund a 2019 commercial rollout of enhancements to its hearing aids. The company's unique technology utilizes a vibrating contact lens that sits on the eardrum to directly activate the hearing system. Among other things, it doubles the range of sound frequencies amplified by other hearing aids.

Earlens is betting its technology breakthroughs will translate into superior user performance that justifies a higher price. Its architecture is fundamentally different from other hearing aids. Most rely on air conduction. They amplify sound waves picked up by microphones and transmit them via a speaker (receiver) through the air in the ear canal to vibrate the ear drum.

The Earlens technology, on the other hand, transforms analog sound waves into digital infrared light pulses that activate the lens on the ear drum. The light waves enable a much broader range of frequency amplification. They also eliminate the whistling feedback that still can be a problem in high-power air-conduction hearing aids. In 2015 the FDA granted Earlens approval to market its device.

Inventor star-power draws investors

The company has raised more than $285 million in capital since its first round of funding in 2010. KCK Ltd., a family investment fund, led the current $87 million preferred stock financing. A significant draw for investors is Earlens Founder Dr. Rodney Perkins, the legendary inventor who pioneered digital hearing aids decades ago at what is now ReSound Hearing.

"Earlens has created the most significant advance in hearing aid technology in decades," said Greg Garfield, Senior Managing Director, KCK Medical Technologies Group. "We feel confident it's game changing and will establish a new, extraordinarily high performance standard for consumers."

Initial users of the new hearing aids have reported positive results. And Earlens is promising a 2019 rollout of product enhancements along with expansion of its distribution network.

Gradual sales ramp

However, product sales have ramped up gradually. Fitting the Earlens product is a more complex process than with normal hearing aids fitted by audiologists.

In addition to requiring a near-perfect impression of the inner ear, the product requires an ear-nose-and-throat doctor to carefully place the lens on the eardrum. Then an audiologist needs to program the hearing aid to the user's audiogram. It's taken time to build and train the network of specialists.

At the same time, the high initial cost of the hearing aids would seem to assure that only the highest end of the premium market will gravitate to the Earlens product initially. One audiologist said his practice was charging $12,000 for a pair, more than twice the cost of other very high-end hearing aids.