Musculoskeletal News Roundup 10-Apr-08
BY LAUREN UZDIENSKI, APRIL 10, 2008
M&A
Kinetic Concepts, Inc. announced plans to acquire LifeCell for $1.7 billion, or $51.00 per share, which represents an 18% premium over LifeCell's closing price on Friday and a 26% premium over the 90-day volume weighted average trading price. KCI will finance the deal using cash and proceeds from a fully underwritten debt financing from Bank of America and JPMorgan Chase. No anticipated closing date was given. KCI, a wound-care company that pioneered negative pressure wound therapy, said the transaction would diversify the company's revenue stream, increase its presence in the operating room and acute-care settings and allow them to capitalize on R&D synergies.
Exactech, Inc. completed its acquisition of France Medica SAS, a French importer and distributor of orthopedic products and surgical supplies. The total transaction value was $11.1 million, comprised of an $8.3 million payment in cash and future performance-based earn-out payments to be made over the next two years. Exactech expects France Medica's contribution to the company's annual revenues for 2008 to be approximately $9.0 million.
After reviewing its options, Orthofix has decided not to divest certain fixation assets in its orthopedic division. Instead, the company plans to begin "improving the operating efficiency and profitability" of the business.
Legal
A class action lawsuit has been filed against ArthroCare on the behalf of individuals who purchased ArthroCare stock between August 4, 2006 and January 23, 2008. The action is pending in the United States District Court for the Southern District of Florida. The complaint alleges that ArthroCare and certain ArthroCare officers violated federal securities laws by "making materially false and misleading statements concerning the company's business and financial results" during the specified time period, particularly regarding revenue from DiscoCare and Device Reimbursement Services.
Product Launches & Updates
Atlas Spine, Inc. launched the Back-PAK Discectomy Set. According to the press release, the Back-PAK DS "offers an advanced instrument system designed to make discectomy procedures and implant site preparation more efficient for surgeons."
Zimmer has initiated voluntary recalls of certain products manufactured at its Dover, Ohio facility that the company says do not meet internal quality standards. Products manufactured at the Dover facility include disposables used in blood management, surgical wound site debridement and cement accessories. The facility has been shut down while Zimmer "[makes] needed improvements to manufacturing and [conducts] enhanced quality training for employees," which is expected to cost the company $70 to $80 million in revenues. The recalls do not affect the company's core hip and knee business.
Distribution
Effective immediately, Kyocera Industrial Ceramics Corporation will sell biocompatible ceramics manufactured by Japan Medical Materials Corporation in North America. JMM products include alumina and zirconia, hydroxyapatite, titanium and vanadium-free titanium and medical-grade ultra-high-molecular-weight polyethylene.
Clinical
Following promising data from its ongoing phase 2 clinical trial, Mesoblast announced plans to broaden the trial to 10 additional sites in the U.S. The company expects the results of the expanded study to accelerate its clinical timetable, leading to the initiation of a phase 3 study in mid-2009. The trial is evaluating the use of Mesoblast's proprietary adult mesenchymal precursor cells in spinal fusion.
