A Medical Device Daily

Orthobiologics company IsoTis (Irvine, California) reported that it is at the final stage of concluding the exchange offer it launched for all of the outstanding shares of Isotis SA (Lausanne, Switzerland) this past December (Medical Device Daily, Dec. 18, 2006).

After this last step of the exchange offer, Isotis SA will no longer be listed on SWX Swiss Exchange, Euronext Amsterdam and the Toronto Stock Exchange.

On Feb. 7, at the end of the first phase of the exchange offer, 64,180,460 shares in Isotis SA had been tendered, representing about 90.5% of the issued and outstanding share capital of the that company.

IsoTis is preparing to obtain the roughly 9.5% still outstanding Isotis SA shares through a squeeze-out merger under Swiss law. The squeeze-out merger will occur following a vote of the shareholders at an extraordinary general meeting (EGM). The required vote to effect the squeeze-out merger is 90% of the outstanding shares. Because IsoTis, Inc. owns in excess of 90% of the outstanding shares of Isotis SA and intends to vote those shares in favor of the squeeze-out merger at the EGM, the company expects that the squeeze-out merger will be approved.

Once the squeeze-out merger is approved, Isotis SA will merge with IsoTis International SA, a newly formed subsidiary of IsoTis.

In connection with the merger, shareholders of Isotis SA will receive 1 share of the new company in exchange for every 10 of their shares. The company shares issued in the squeeze-out merger will be listed on the NASDAQ Global Market.

IsoTis develops products for the treatment of musculoskeletal diseases and disorders. IsoTis' current orthobiologics products are bone graft substitutes that promote the regeneration of bone and are used to repair natural, trauma-related and surgically-created defects common in orthopedic procedures, including spinal fusions.

In other dealmaking news:

• Micromedics (Saint Paul, Minnesota), a developer of medical devices for the ear, nose and throat (ENT) market, has acquired Santa Barbara Medco (Santa Barbara, California), a developer of over-the-counter ear protection products. Terms of the transaction were not disclosed.

The company said the acquisition immediately increases its revenue by 15% and provides a distribution channel to the over-the-counter market.

"Santa Barbara Medco's products complement our current product lines and this acquisition gives us access to an efficient sales avenue," said Curt Miller, Micromedics founder and CEO. "We see strong opportunities to grow through expansion of our product lines and by distributing products to the large over-the-counter market."

In addition to over-the-counter products, Santa Barbara Medco sells directly to consumers and physicians' offices. Product lines include Physician's Choice Ear Drops, Ear Putty and Foam Ear Plugs; Eavey Ear Easy Wrap Ear Bands; and Swimmer's Choice Ear Drops.

In the past year, Micromedics has introduced several medical products ranging from biomaterials applicators to implants for use in ENT surgery. Additionally, the company continues to support the rapid growth of the EarPopper, a small, hand-held device for treating ear pressure and middle-ear fluid.

Micromedics began as a developer and manufacturer of microsurgery products. Its first product was implantable ear ventilation tubes. Currently, the company manufactures four product lines: products for otolaryngology, products for organizing and protecting surgical instruments, applicators for biomaterials and the EarPopper. Micromedics also privately label its products for distribution by other medical device companies.

• HealthTronics (Austin, Texas), a provider of urology services and products, reported that it has completed the previously disclosed acquisition of partnership interests in Keystone Mobile Partners (Willow Grove, Pennsylvania).