A Medical Device Daily

American Medical Systems Holdings (Minnetonka, Minnesota) reported its acquisition of assets from Israeli company BioControl Medical , focused on the development of medical devices for the application of implantable electrical stimulation technology. AMS acquired an exclusive license for the use of BioControl technology – named miniaturo – for use in urology, gynecology and other pelvic applications.

The price tag is comprised of an initial payment and milestone payments (for FDA approval of the product) of $50 million and royalties over the first 10 years of the related license agreement.

As its initial application of the BioControl technology, AMS will finalize development of the miniaturo to treat urge incontinence and interstitial cystitis, a condition affecting primarily women in which the tissues of the bladder wall become inflamed and lead to urinary frequency, urgency, leaking episodes and pelvic pain.

Martin Emerson, president and CEO of American Medical, said, “Our entree to the field of implantable electrical stimulation with BioControl reinforces our commitment to innovative technologies for the treatment of pelvic health disorders. Implantable electrical stimulation will serve as a significant platform technology to that end.“

Ehud Cohen, CEO of BioControl, said, “We are excited by the prospect of combining our technology platform with American Medical Systems' presence in the urology and gynecology markets. The unique features of the miniaturo, including its straight-forward implantation technique, will broaden the application of electrical stimulation technology to pelvic health conditions.“

Peter DeJong, MD, a gynecologist at Groote-Schuur Hospital (Cape Town, South Africa), said, “Under the clinical study of the miniaturo, I have implanted the system in 22 patients for the treatment of urinary voiding dysfunction. My patients have been very satisfied with the therapy and experience improvement not only in their voiding disorders . . . but also in their quality of life.“

American Medical is a supplier of medical devices and procedures to treat erectile dysfunction, benign prostatic hyperplasia, incontinence, menorrhagia, prolapse and other pelvic disorders in men and women.

BioControl, since its launch, has focused on development of the miniaturo. Going forward, it said it will focus on the development of the CardioFit system, an implantable neurostimulator for the treatment of congestive heart failure.

In other dealmaking activity:

• Diversified Therapy (Jacksonville, Florida) and Praxis Clinical Services (Tustin, California) reported that they have merged, to be operated as Diversified Clinical Services . The companies said the marriage “brings together two of the country's top wound care management organizations.“ Diversified Clinical Services said it will be the largest outpatient wound care management company in the U.S., with more than 150 programs at U.S. hospitals.

Jim Henry, president and CEO of Diversified Therapy, will be CEO and Jack Rollins, president and CEO of Praxis Clinical Services, will be president of the merged organization.

“Hospitals today clearly recognize the value of outsourcing services to expert providers,“ observed Rollins. “This merger gives us added resources and scale to provide turnkey wound care programs with an unsurpassed level of expertise. Additionally, as a result of the merger, our expanded organization and national network of partners will allow us access to important clinical information on chronic wounds. This will result in new research, additional value-add services and enhanced wound care education and training for our medical and clinical teams.“

The annual cost of treating patients in the U.S. with problem wounds is estimated at more than $16 billion and is growing. There are several factors contributing to the expanding need for specialized wound care, including more cases of diabetes, an aging population and the effects of radiation therapy.

“The demand for comprehensive wound care services from hospital administrators, physicians and patients continues to grow each year,“ Henry said. “Combining resources with Praxis ensures that we're able to meet this growing need while continuing to provide the highest levels of clinical expertise and customer service for both our existing and future wound care programs.“

The companies reported treating, combined, nearly 40,000 patients in 2005 and more than 300,000 patient visits. The companies report wound care healing rates in excess of 85% and patient satisfaction ratings that exceed 98%.

The merger of Diversified Therapy and Praxis Clinical Services is being funded by three private equity firms: The Jordan Company, The Edgewater Funds and Bolder Capital.

• Radiation Therapy Services (RTS; Fort Myers, Florida), a radiation center operator, reported acquiring a radiation therapy treatment facility in Santa Monica, California, for about $11 million in cash and assumption of $900,000 in debt. RTS said the acquisition provides it entrance into the Los Angeles market, its second local market in Southern California.

The facility has an intensity modulated radiation therapy (IMRT) program and other advanced technologies and generates annual revenues of about $6 million. Radiation Therapy will begin operating the facility on May 1.

Dr. Michael Steinberg, healthcare policy and economics council chair, American Society of Therapeutic Radiology and Oncology (ASTRO; Fairfax, Virginia) and partial owner of the Santa Monica facility, joins the company as senior vice president.

RTS, operating centers under the name 21st Century Oncology , has 70 treatment centers clustered into 23 local markets in 14 states.

• Arrow International (Reading, Pennsylvania) reported acquiring certain assets of its UK distributor, Kimal (Middlesex), for up to about $9 million. The transaction included the acquisition of distributorship rights and customer lists, as well as the inventory and specified contracts associated with Kimal's sale of the company's products in the UK and Ireland.

Kimal has been one of the company's flagship distributors in Europe for more than 27 years, most recently having responsibility for the UK, Ireland and Middle East territories.

Arrow also entered into a multi-year agreement with Kimal, providing for the continuation of current levels of customer service and logistical support to its UK and Ireland customers.

The company anticipates that the acquisition will increase sales by about $2 million for the fiscal year ending Aug. 31, 2006.

Arrow manufactures disposable catheters and related products for critical and cardiac care.