Edwards Life Sciences (Irvine, California) and C. R. Bard (Murray Hill, New Jersey) have signed an agreement for Edwards to sell assets of its LifeStent peripheral vascular product line to Bard for up to $140 million.
The transaction is expected to close in January, pending regulatory approvals, including Hart-Scott-Rodino clearance.
The deal includes cash payments of about $74 million upon closing and up to an additional $65 million on the achievement of certain milestones, including FDA approval of LifeStent products for a superficial femoral artery (SFA) indication and the transfer of LifeStent device manufacturing. For 2007, this business represents about $30 million in sales, according to Edwards.
Bard’s Peripheral Vascular division in Tempe, Arizona, will assume marketing responsibility for the product.
“Although sales are growing, the LifeStent product line is generating operating losses,” said Michael Mussallem, Edwards’ CEO and chairman. “This transaction enables Edwards to increase our investments in the exciting opportunities in our market-leading heart valve and critical care businesses. Achieving leadership in the peripheral vascular market would have required substantial additional investment, which can now be directed to our core businesses.”
Edwards said it would provide transition services for up to two and a half years following the closing. About 150 employees may be affected by the end of the transition, the company said.
“We would like to express our sincere gratitude to our dedicated employees along with the committed clinicians in this field with whom we have had the opportunity to work over the past several years. We clearly recognize the value that has been created as a result of their efforts to improve the care of patients suffering from peripheral vascular disease,” Mussallem said. “We are pleased that patients will continue to benefit from this technology under the new ownership.”
An Edwards spokesperson told Medical Device Daily the company would be “working very closely with all of these employees” to find them new positions either within Edwards, with Bard, or elsewhere. She added that Edwards would continue managing the RESILIENT trial for the next two and a half years.
Edwards recently completed the one-year follow-up of 206 patients in its RESILIENT trial. In the study, the LifeStent device was compared to standard percutaneous transluminal angioplasty (PTA) in the treatment of SFA and proximal popliteal stenotic disease. At one year, the PTA plus stenting arm of the study demonstrated clear superiority with 80% primary patency compared to 38% patency in the PTA only arm. These results were highly statistically significant (p<0.0001), the company noted. Additionally, in the SFA, the LifeStent device was found to have a low fracture rate of only 2.9% at one year. Edwards has submitted a pre-market approval application to the FDA and is currently responding to the agency’s follow-up questions. The LifeStent product family is available in the U.S. for biliary indications only.
“The acquisition of the LifeStent product family is a significant strategic addition to our portfolio of non-coronary stent and stent graft products. Pending FDA approval, the LifeStent SFA product, the Flair arteriovenous access stent graft and ELuminexx Iliac stent will together give Bard one of the broadest product offerings for peripheral vascular stenting,” said Timothy Ring, CEO and chairman of Bard.
Excluding the impact of a charge for purchased R&D, Bard says it expects the deal to have a negligible effect on earnings in 2008 and be accretive thereafter.
When asked if Bard would be creating any new positions in connection with the deal or if any Edwards employees would be transferring over to Bard, a company spokesperson declined to answer. She told MDD that Bard would be disclosing more details about the deal during its annual investor meeting Dec. 18 in New York.
Bard develops technologies in the fields of vascular, urology, oncology and surgical specialty products.
Edwards Lifesciences, a developer of advanced cardiovascular disease treatments, focuses on specific cardiovascular opportunities including heart valve disease, peripheral vascular disease and critical care technologies.
In other dealmaking news:
• Caris Diagnostics (Irving, Texas) reported an agreement to combine with Molecular Profiling Institute (MPI; Phoenix) and its subsidiary, the Tissue Banking and Analysis Center, a CLIA-certified molecular diagnostics company focused on the development of molecular diagnostic tests based on genomic and proteomic profiling.
MPI provides testing facilities, prognostic testing services, and resources for genomic and proteomic profiling to help guide physicians in the treatment of cancer and other complex diseases.
Caris provides surgical pathology services to physicians who treat patients in an ambulatory setting.
• LABS (Denver) said it has finalized its agreement to acquire the assets of Laboratories at Bonfils – a subsidiary of Colorado-based Bonfils Blood Center (Medical Device Daily, Oct. 31, 2007).
The parties closed the agreement on Nov. 30.
LABS, a nonprofit, taxable affiliate of AlloSource (Centennial, Colorado), is a testing facility for the specialized needs of organ procurement organizations, eye and tissue banks. It will continue to provide donor eligibility testing for the human eye, tissue, reproductive, stem cell and solid organ transplant industry.
• Optimal Readings Services Group (Birmingham, Alabama), a provider of optimization services for radiology, said it has acquired Pin Point Radiology (Fort Worth, Texas).
Optimal Readings and Pin Point will combine their operations and Pin Point will bring its radiology management contracts with hospital and radiology group clients under the Optimal service optimization platform. Pin Point’s radiologists will join the Optimal Readings team and will augment Optimal Readings radiology services capabilities to further optimize, supplement and extend the radiology operations for its customers, the companies said.
• U.S. HealthWorks Medical Group (Valencia, California) reported the acquisition of Inland Industrial Medical Group (Ontario, California).
Both companies offer employers comprehensive occupational health care, including injury and illness diagnosis and treatment, pre-placement and post-offer physical exams, drug and alcohol testing, physical therapy and orthopedic services.