A Medical Device Daily
AngioDynamics (Queensbury, New York) reported that the first human clinical use employing irreversible electroporation (IRE) to ablate soft tissue was completely successful based on analysis of biopsies performed on five patients two weeks after their treatment. The IRE treatment was conducted during the first week of April as part of a pilot trial focused on determining the success of treating soft tissue with IRE.
As a result of the successful procedures, AngioDynamics has agreed to pay a total purchase price of $25 million for Oncobionic (San Francisco), the developer of the technology, less Oncobionic's long-term debt as of the closing date of the acquisition.
Angiodynamics paid $5 million of the purchase price at the execution of the original purchase agreement in October 2006 (Medical Device Daily, Oct. 19, 2006). At that time, Angiodynamics said the acquisition would be completed upon the first four consecutive cases of successful treatment of soft tissue in humans.
In November 2006, the FDA cleared the IRE technology for human use for the indication of soft tissue ablation.
The clinical results reported yesterday will trigger the second installment of about $10 million upon the closing of the acquisition, which is expected to be completed in May. In addition, about $5 million is payable six months after the closing date and the remaining balance of roughly $5 million is payable 18 months after the closing date.
The two companies have worked together since 2004, when AngioDynamics signed a distribution-and-option agreement with Oncobionic for advancement of its IRE soft-tissue ablation technology for focal cancer therapy.
Biopsies taken from the treated patients' prostates were normal and the patients had no side effects. The trial is expected to continue to develop clinical data on the technology's therapeutic effectiveness.
"This confirms our belief in the value of the technology and its promise to become the next generation of ablation technology," said Gary Onik MD, president of Oncobionic.
IRE is a non-thermal tissue ablation technique in which electrical fields are used to create nano-scale defects in a cell's membrane, which is designed to cause cell death only in the targeted tissue, without destroying critical structures such as ducts, blood vessels and nerves.
A research team headed by Boris Rubinsky, a professor of bioengineering at the University of California, Berkeley, invented the IRE technology used in this trial. The technology is exclusively licensed by the University of California to Oncobionic for commercial development.
"With the closing of the transaction, we will move towards our next milestone of providing 20 IRE systems to thought leaders in the field of focal soft tissue ablation who will begin using the systems to treat patients and develop clinical data on the technology's effectiveness," said Eamonn Hobbs, AngioDynamics president/CEO.
In other dealmaking news:
• Scient'x (Gyuancourt, France) reported that it has repurchased the Isobar dynamic rod license from Alphatec Spine (Carlsbad, California), thus, it said, making it the "ultimate exclusive holder" of the Isobar dynamic rod intellectual property globally.
Alphatec said it was making the sale because it did not feel that the product fit in with its current marketing strategy.
"Strategically we saw the Isobar, which we sold under the Dynamo brand name, as a potential distraction from Alphatec's strategy of being the market leader for solutions for the aging spine," said Alphatec President/CEO Dirk Kuyper. "A year ago, licensing the Isobar made sense for Alphatec because it was seeking to introduce novel technologies to its formidable distribution network. Today, we have refined our strategic vision and are focused on introducing novel technologies aimed at the fast-growing aging spine segment of the spine market."
Alphatec had originally planned to acquire Scient'x in 2006 (MDD, Sept. 29, 2006). In January 2007, it cancelled that arrangement for undisclosed reasons, and instead signed three license agreements with Scient'x to make and sell several spinal implants in the U.S. (MDD, Jan. 25, 2007).
• SunLink Health Systems (Atlanta) reported that it has acquired Carmichael's Cashway Pharmacy (Crowley, Louisiana) for a purchase price of about $24 million, consisting of $19 million cash, seller subordinated debt of $3 million and $2 million of SunLink shares (334,448 shares).
Carmichael's, with annual revenues of about $42.2 million, has been in business for more than 30 years and supplies infusion therapy, specialty and institutional pharmacy services, enteral products, respiratory medications, medical equipment and retail pharmacy services to rural communities in southwest Louisiana and eastern Texas.
SunLink also reported that it has entered into a new $47 million credit facility, a portion of the proceeds of which have been applied to repay SunLink's existing debt, complete the acquisition of Carmichael's and to pay costs and expenses relating to the refinancing and Carmichael's transactions and the balance of which will be available for working capital purposes.
The seven-year credit facility is comprised of a $12 million revolver with interest at LIBOR plus 3.50% and a $35 million term loan amortizable over 20 years with interest at LIBOR plus 5.07%. In connection with the closing of the Carmichael's transaction and repayment of its existing credit facility, SunLink drew-down a total of $40.5 million under the new credit facility.
Chatham Capital, a $700 million private investment fund based in Atlanta, is the agent and lender for the new credit facility.
SunLink currently operates seven community hospitals and related nursing home and home care businesses in the Southeast and Midwest and its home care and specialty pharmacy business in Louisiana.
• Global Med Technologies (Lakewood, Colorado), an international e-health medical information technology company, reported that its Wyndgate Technologies division has signed an agreement to license its SafeTrace donor management system to St. Joseph's Healthcare System (Paterson, New Jersey). SafeTrace will be used to monitor blood donations for St. Joseph's Regional Medical Center's blood bank. Terms of the agreement were not disclosed.
St. Joseph's said Wyndgate's SafeTrace system will help it manage the volume of information needed to successfully administer a large healthcare system's blood bank, including donor scheduling, blood product manufacturing and infectious disease testing.