A Medical Device Daily

Wright Medical Group (Arlington, Tennessee), an orthopedic device company, reported the pricing of $175 million aggregate principal amount of convertible senior notes due 2014 in an offering.

Wright has increased the size of the offering from the $150 million it reported earlier this week.

The notes will pay interest semiannually at a rate of 2.625% per annum. The notes will be convertible into shares of Wright's common stock at an initial conversion rate of 30.6279 shares per $1,000 principal amount of the notes, which represents an initial conversion price of about $32.65 a share. Wright has granted the underwriters the right to purchase up to an additional $25 million aggregate principal amount of the notes.

Wright said it intends to use the proceeds for general corporate purposes, including acquisitions, "from time to time."

The sale of the notes is expected to close Monday.

J.P. Morgan Securities is acting as sole book-running manager of the offering. Piper Jaffray and Wachovia Capital Markets are acting as co-managers.

In other financing activity:

  • Uroplasty (Minnetonka, Minnesota) reported the pricing of its public offering of 1,466,400 shares of common stock. The offering was priced at $3.50 a share. Uroplasty has granted the underwriters a 30-day option to purchase up to an additional 219,960 shares of common stock at the offering price to cover over-allotments. Uroplasty said the proceeds from the sale would be used to expand its sales and marketing organization in the U.S., to conduct clinical studies to support its marketing efforts and for working capital purposes. Craig-Hallum Capital Group is serving as bookrunning lead manager for the offering with Noble International Investments acting as co-manager. Uroplasty develops products for the treatment of voiding dysfunctions.
  • Quality Systems (Irvine, California) reported that the Los Angeles office of the Securities and Exchange Commission said in a letter to the company it has completed its investigation of trading activities in the Quality Systems' securities and does not intend to recommend any enforcement action. Quality Systems develops computer-based practice management, patient records, and connectivity applications for medical and dental group practices.

In earnings reports:

  • SpectRx (Norcross, Georgia) reported its operating results from the third quarter and first nine months of 2007. Revenue for the third quarter was $201,000, compared to revenue of $337,000 in the third quarter of 2006. For the nine months ended Sept. 30, revenue was $700,000, compared to $483,000 for the same period last year. The net loss available to common stockholders for the third quarter of 2007 was $1.3 million, or 10 cents a share, compared with a net loss available to common stockholders of $1.2 million, or 10 cents a share, in the comparable quarter of 2006. For the first nine months of 2007, the net loss available to common stockholders was $21,000, compared to a net loss available to common stockholders of $4.1 million, or 35 cents a share, in the first nine months of 2006. The net loss available to common stockholders for the nine months ended Sept. 30 included a gain of roughly $5.8 million from debt forgiveness and a gain of about $2.4 million on the sale of the SimpleChoice business, offset primarily by a deemed dividend of about $3.8 million on series A convertible preferred stock.

SpectRx is developing a test for the early detection of disease that leads to cervical cancer.

  • Zynex Medical Holdings (Littleton, Colorado), a provider of pain management systems and electrotherapy products for patients with functional disability, reported a 173% increase in revenue the first nine months of 2007 compared to the same period last year. The company also reported a profit of $1,197,694 for the period. Net sales and rental income for the three and nine months ended Sept. 30 were $2,104,446 and $4,946,384, an increase of $1,360,659 and $3,136,646 or 183% and 173%, compared to $743,787 and $1,809,738 for the three and nine months ended Sept. 30, 2006. Income from operations was $856,144 for the quarter and $1,876,009 for the nine months respectively versus $34,087 and $50,503 a year ago. Operations generated a cash flow of $437,602 during the first nine months of 2007, which was primarily used to acquire additional equipment, Zynex said. Gross profit margin increased to 92.5% for the quarter and 91.2% for the three quarters. Selling, general and administrative expenses for the three and nine months ended Sept. 30 were $1,045,087 and $2,529,281, an increase of $469,057 and $968,947 or 81.4% and 62.1%, compared to $576,030 and $1,560,334 for the same periods in 2006. As a result the net income after taxes was $614,465 for the third quarter and $1,197,694 for the nine months in 2007.
  • Elron Electronic Industries (Tel Aviv, Israel) reported a net loss for the third quarter and for the first nine months of 2007 of $20 million, or 69 cents a share, and $16.7 million, or 57 cents a share, respectively. In the third quarter and first nine months of 2006, Elron reported a net loss of $4.4 million, or 16 cents a share, and $14.4 million, or 50 cents a share, respectively.