A Medical Device Daily

Kyphon (Sunnyvale, California) reported that it has set Oct. 16 as the date of the special meeting of stockholders to vote on Kyphon’s proposed $3.9 billion merger with a wholly-owned subsidiary of Medtronic (Minneapolis).

The special meeting will be held at 2:00 p.m., PST, at Kyphon’s corporate headquarters located at 1221 Crossman Avenue, Sunnyvale, California 94089. Kyphon shareholders of record as of the close of business on Aug. 31 will be entitled to notice of, and to vote at, the special meeting. A definitive proxy statement containing information about the special meeting and the proposed merger will be filed with the Securities and Exchange Commission (SEC) and a copy of the definitive proxy statement will be mailed to stockholders of record as of the record date. The mailing is expected to begin early next week.

As previously reported in July, Kyphon entered into a definitive merger agreement in which Medtronic has agreed to acquire all of the outstanding shares of Kyphon common stock for $71 per share in cash (Medical Device Daily, July 30, 2007).

Completion of the transaction, which is presently anticipated for 1Q08, remains subject to customary closing conditions, including approval by antitrust regulators as well as Kyphon’s stockholders.

Kyphon develops medical devices designed to restore and preserve spinal function and diagnose the source of low back pain using minimally invasive technologies. The company’s products are used in balloon kyphoplasty for the treatment of spinal compression fractures caused by osteoporosis or cancer

Affymetrix (Santa Clara, California) reported that Empire Genomics (Buffalo, New York) has obtained a non-exclusive, worldwide license to a number of Affymetrix patents covering the manufacturing, use and sales of nucleic acid microarrays and related products and services for comparative genomic hybridization (CGH). The arrays and services may be used for research or diagnostic purposes. Financial details of the license were not disclosed.

“Affymetrix continues to establish mutually beneficial licensing relationships with companies such as Empire Genomics to help stimulate the broad commercialization of genome analysis technologies,” said Alan Sherr, VP and chief counsel for licensing at Affymetrix.

“This agreement with Affymetrix enables Empire Genomics to bring its innovative genomics platform to market while continuing the advancement of personalized medicine. We fully expect that focusing in the field of copy number variation will lead to the discovery of the genomic causes of multiple diseases, as well as advanced therapeutic treatment strategies,” said Anthony Johnson, president/CEO of Empire Genomics.

Empire Genomics is active in the field of molecular diagnostics and genomic-based testing. Its molecular karyotyping platform technology is used to identify and quantify chromosomal abnormalities.

Affymetrix technology is used by pharmaceutical, diagnostic and biotechnology companies, as well as academic, government and not-for-profit research institutes. More than 1,600 systems have been shipped around the world and more than 9,500 peer-reviewed papers have been published using the technology.

In other dealmaking news:

• U.S. Physical Therapy (Houston) reported that it has acquired a majority interest in STAR Physical Therapy (Franklin, Tennessee), a multi-partner outpatient rehabilitation practice with operations in the southeast U.S.

STAR owns and operates 52 outpatient physical and occupational therapy clinics and manages seven other facilities for third parties.

In the calendar year 2006, STAR produced about $26.5 million in net revenue with 268,000 patient visits, with an average net rate per visit of $89.47. Total net revenue for the first six months in 2007 was $15.1 million with 155,000 patient visits with an average net rate per visit of $89.41. STAR’s current payor mix is about 58% from private healthcare insurance, 20% workers compensation, 19% Medicare and 3% other.

U.S. Physical Therapy operates 348 outpatient physical and/or occupational therapy clinics in 42 states. The company’s clinics provide preventive and post-operative care for a variety of orthopedic related disorders and sports-related injuries, treatment for neurologically-related injuries and rehabilitation of injured workers.

Emeritus (Seattle) a provider of assisted living and Alzheimer’s and related dementia care services to senior citizens, announced that it has completed the transaction with Summerville Senior Living, (San Ramon, California) Granger Cobb, formerly president/CEO of Summerville has been appointed president/Co-CEO of the company along with Daniel Baty, who will also retain his position as board chairman of Emeritus. With the completion of the merger, Emeritus said it is one of the largest national assisted living companies, operating 287 communities in 36 states, comprising 24,712 units with a capacity for 29,474 residents.

As expected, Emeritus issued about 8.5 million shares of its common stock to the shareholders of Summerville, including Apollo Real Estate Investment Funds III and IV, (“Apollo Funds”), two real estate funds managed by Apollo Real Estate Advisors, and certain employees of Summerville. Of the total number of shares issued in the transaction, a portion was issued in satisfaction of certain loans outstanding from the Apollo Funds to Summerville.

Emeritus is a provider of assisted living and Alzheimer’s and related dementia care services to seniors.