Medical Device Daily
Endoscope maker Vision-Sciences (Natick, Massachusetts) has signed an agreement to sell certain manufacturing assets for the production of its ENT sheath products to Medtronic Xomed (Jacksonville, Florida) a wholly-owned subsidiary of Medtronic (Minneapolis, Minnesota), for up to $34 million.
Medtronic will pay Vision-Sciences $27 million at closing and up to $4 million more upon the achievement of certain post-closing milestones related to the transaction, and an additional $3 million about 15 months after closing.
Additionally, Vision-Sciences has granted the ENT business of Medtronic an exclusive, royalty-free worldwide license to its EndoSheath intellectual property, solely for use in making and selling sheath products within the ENT (otorhinolaryngology) sector. Vision-Sciences said it will transfer its existing production lines for the EndoSheath ENT products to the ENT business at Medtronic.
Ron Hadani, president/CEO of Vision-Sciences, told Medical Device Daily the transaction will allow the company to focus on accelerating development of new products and technologies, potentially acquire related technologies and enter new markets that the company has identified.
“We are entering the urology market, and we’re coming with new technologies. We eventually plan to revolutionize that market,” Hadani told MDD.
Medtronic and Vision-Sciences also amended their existing distribution relationship under which Medtronic has been distributing Vision-Sciences’ ENT Endoscope and EndoSheath products in the U.S. and Canada since 2004. Now, Medtronic will have the right to distribute, market and sell EndoSheath Products on a worldwide basis. The products will initially be supplied by Vision-Sciences until Medtronic has established its own manufacturing capacity for EndoSheath products.
Medtronic will now also market and sell Vision-Sciences’ ENT endoscope products worldwide, on a co-branded basis, through its dedicated sales force.
“We believe that the innovative EndoSheath System, coupled with Medtronic’s highly professional and established sales and marketing forces, will result in effective market penetration for the products,” Hadani said.
Vision-Sciences makes flexible endoscopic products for the urology, gastroenterology and ENT markets, using sterile disposable sheaths and the Slide-On EndoSheath System, designed to enable physicians to perform diagnostic and therapeutic procedures without specialized endoscopes.
“You don’t need to process the scope between patients, so the utilization of the scope is much higher,” Hadani said.
The ENT Slide-On EndoSheath system, for example, is designed to provide a sterile, disposable barrier between the scope and the patient. Because it slides on and is removable from the endoscope, the device will last longer because it avoids damage associated with reprocessing it in between procedures, according to Vision-Sciences.
In other dealmaking news:
• Corautus Genetics (Atlanta) reported that, in accordance with its previously stated intention to identify other life science opportunities, it is in discussions regarding a potential business combination with a privately-held biotech company. It gave no assurance that an agreement will be reached, or if an agreement is entered into, that an acquisition will be consummated.
Corautus reported in November that it was abandoning further clinical trials of VEGF-2 for the treatment of cardiovascular and peripheral vascular disease and it released several members of its management team (Medical Device Daily, Nov. 7, 2006).
Until then, the company had been focusing on the development of gene transfer therapy products for the treatment of severe angina and peripheral vascular disease, with the goal of developing a gene therapy product candidate using the VEGF-2 gene to promote therapeutic angiogenesis in ischemic muscle, primarily in its Genetic Angiogenic Stimulation (GENASIS) trial.
The FDA in April blocked further enrollment in GENASIS following adverse patient events (MDD, April 11, 2006), primarily three incidents of pericardial effusion in which excess fluid builds in the sac surrounding the heart. The company responded saying it would pursue further analysis of the trial and gather additional data, and the FDA in July then put the trial on “partial hold” (MDD, July 14, 2006).
• Rosetta Biosoftware (Seattle) reported that Oji Paper Co. (Tokyo) has licensed the Rosetta Resolver system to characterize gene expression profiles of wood-forming tissues. The Resolver system will be used in the Forestry Research Institute, which uses biotech applications to investigate which tree species are suitable for afforestation and paper manufacturing material. No financial terms were disclosed.
The Resolver system is a data storage, retrieval, and analysis solution for gene expression data used by life science research organizations that need to assess compound specificity or toxicity, identify new genes or therapeutic targets or compare and analyze large databases of expression profiles. The system can accept and analyze data from a wide variety of expression profiling formats, and applies Rosetta Biosoftware’s proprietary error models to yield quality statistics for every gene expression measurement within the system.
Oji is a paper and end-use product supplier involved in the conversion/processing and sales of paper products.
• American Medical Systems Holdings (AMS; Minneapolis) reported completing the sale of the assets of its previously reported aesthetics division acquired via the Laserscope (San Jose, California) acquisition to Iridex (Moutainview, California).
The companies reported signing the agreement late last year (Medical Device Daily Dec. 4, 2006).
AMS supplies medical devices and procedures to treat erectile dysfunction, benign prostatic hyperplasia, incontinence, menorrhagia, prolapse and other pelvic disorders in men and women.
• ATC Healthcare (Lake Success, New York) reported signing a license agreement with Elite Healthcare Staffing (Minneapolis). Financial terms were not disclosed.
Elite has been operating in the Minneapolis market for five years. Elite will now operate using the ATC name and will look to develop the Twin City markets as well as other promising markets within Minnesota, the company said.
ATC bills itself a national leader in medical staffing personnel to hospitals, nursing homes, clinics and other healthcare facilities with 56 locations in 35 states. ATC provides supplemental staffing, outsourcing and human resource solutions to hospitals, nursing homes, medical and research facilities and industry.