A Medical Device Daily

Radiation Therapy Services (RTS; Fort Myers, Florida) reported the completion of its previously disclosed $1.1 billion merger with an affiliate of Vestar Capital Partners (Medical Device Daily, Oct. 23, 2007).

At a special meeting held on Feb. 6, 2008, RTS shareholders voted to approve the merger. RTS shareholders are entitled to receive $32.50 in cash, without interest, for each share of common stock held. RTS common stock was scheduled to cease trading on the Nasdaq on Friday.

The merger consideration and refinancing of previously existing debt was provided by affiliates of Vestar and through financing arranged by Wachovia Capital Markets, BNP Paribas Securities and Sumitomo Mitsui Banking.

Wachovia Capital Markets acted as financial advisor to RTS in connection with the transaction. Morgan Joseph & Co. served as financial advisor to the special committee of the RTS board. Shumaker, Loop & Kendrick, served as legal counsel to RTS. Kirkland & Ellis and Kennedy Covington Lobdell & Hickman served as legal counsel to Vestar.

RTS, which operates radiation treatment centers primarily under the name 21st Century Oncology, is a provider of radiation therapy services to cancer patients. The company’s 84 treatment centers are clustered into 27 local markets in 16 states.

HemCon Medical Technologies (Portland, Oregon) said it intends to acquire Alltracel Pharmaceuticals (Dublin) in a cash-for-stock agreement. Financial terms were not disclosed.

The acquisition, which is subject to the approval of Alltracel’s shareholders (and a number of other conditions including approval of the Irish High Court), is being implemented under applicable Irish legislation. The purchase is occurring through Castlerise Investments, a newly-formed subsidiary of HemCon.

Post-completion, Alltracel will operate as a subsidiary of HemCon and maintain headquarters in Dublin. The deal is anticipated to close in 2Q08, with combined projected revenues predicted to exceed $100 million.

HemCon is developer of the chitosan-based hemostatic HemCon bandages and ChitoFlex dressings used by military and medical first responders and healthcare professionals. HemCon also makes the KytoStat consumer bandage, launching, it said, later this month.

Alltracel focuses on taking technology from research through to commercialization in the global healthcare market, including private-label oral care products licensed in Europe through the Butler and GUM brands. The company also licenses technologies in cosmeceuticals, nutraceuticals and wound care.

HemoCon said the agreement opens up distribution opportunities for its KytoStat bandage and other chitosan-based products in Europe and Alltracel’s oral care products and medical technologies in the U.S.

The acquisition will also provide HemCon access to Alltracel’s joint venture with Elmarco (Prauge, Czech REpublic) and its nanotechnology manufacturing process called Nanospider. HemCon said it will seek to leverage this process to aggressively grow its market share in acute wound care products developed from chitosan.

In other dealmaking news:

• Xenomics (Monmouth Junction, New Jersey) reported that it has granted Warnex Medical Laboratories (Laval, Quebec), a division of Warnex (Laval), non-exclusive rights in Canada to offer NPM1 testing as a laboratory service for the diagnosis, stratification and monitoring of patients with acute myeloid leukemia (AML).

AML is a heterogeneous disease with about 200,000 new cases a year worldwide. The disease subgrouping by karyotypic abnormalities indicates patient prognosis. However, in almost half of AML cases the karyotype appears normal and provides no guide for the physician. A recent discovery showed that many AML patients have mutations in the NPM1 gene, a favorable marker for clinical outcome.

Xenomics holds exclusive rights to the discovery and has non-exclusively sub-licensed its diagnostic applications to Warnex to offer clinical testing. The results of such a test will help physicians select patients with good prognosis of benefiting from intensive chemotherapy, while sparing others with a low probability of benefit from the toxic treatment, the companies said.

The NPM1 mutation may also be used to monitor AML patients for residual disease during chemotherapy. Stratification of AML patients is also necessary for anti-AML drug clinical trials.

• Community Health Systems (CHS; Franklin, Tennessee) reported that it sold its operating interest in and assets associated with Beacon Hospital (Dublin, Ireland) to Beacon Medical Group, an Irish private limited company, effective Feb. 21.

Through its subsidiaries, CHS owns, leases or operates about 125 hospitals in 28 states, with about 18,600 licensed beds.

• Affiliated Computer Services (ACS; Dallas) has acquired Bowers & Associates, a Wisconsin-based provider of quality care and productivity management services and healthcare data analytics, for $8 million, plus milestones based on financial performance.

ACS said the acquisition strengthens its Informed Health offerings by adding Bowers’ expertise in healthcare management and informatics.
“Bowers will broaden the capabilities of our government healthcare business to include the delivery of best-in-class, accredited care management services for high-risk beneficiaries,” said Christopher Deelsnyder, ACS senior VP and managing director, Government Healthcare Solutions.”

Bowers manages care for about 225,000 plan members. Bowers’ employees will transition to ACS.

• Cogdell Spencer (Charlotte, North Carolina) reported the $4.55 million acquisition of the leasehold interest in floors six and seven of St. Mary’s North Medical Office Building, a multi-tenant medical office building on the campus of St. Mary’s Hospital (Richmond, Virginia).

The acquisition was funded by Cogdell Spencer’s existing internal line of credit.

Cogdell Spencer invests in specialty office buildings for the medical profession.