A Medical Device Daily Staff Report
NuVasive (San Diego), a company focused on developing products for minimally disruptive surgical spine treatments, reported acquiring the intellectual property and related assets for a cervical plate technology from privately owned RSB Spine (Cleveland, Ohio).
NuVasive will pay $5.5 million in cash and 222,929 shares of its common stock or about $9 million based on NuVasive current stock price. In addition, RSB will receive annual milestone payments for the life of the acquired patent, based on sales.
NuVasive said that the acquisition provides it with cervical plate technology 510(k) FDA-cleared and first commercialized in 2004. NuVasive will obtain all product revenues beginning this month and that it will re-launch the cervical plate (named SmartPlate) under its own product name in July.
NuVasive describes the product as “a dynamic plate that offers unique features [that] make the plate superior to others on the market,” including its own under development, and it reports the product used in about 250 cervical fusion procedures to date. It estimates revenue of $2 million to $3 million for product sales in 2006.
SmartPlate features a gradient locking mechanism, NuVasive said, that enables the screws to be progressively resistant to axial compression, thus allowing the plate to settle in concert with the eventual allograft implant settling that occurs within the disc space over time, offering a better anatomical fit. It said its own cervical plate under development, a fixed cervical plate, did not account for such implant settling, with less adequate fusion results.
An additional SmartPlate feature is its low profile, tapered design, for less post-operative soft tissue disruption, and use of familiar instrumentation enables “rapid surgeon adoption and easier insertion of the plate on to the spine.”
The sale includes instrument sets and accompanying cervical plate inventory of about $1 million.
The agreement grants NuVasive the right of first refusal on all additional existing technologies and any future technology that may be developed by RSB Spine during the next five years, such as enhancements to the gradient locking technology and other products that would be complementary to the acquired technology.
The company reported that it will take a 2Q05 charge of about $400,000 for investments in fixed assets and inventory created for the initial alpha/beta testing of its own cervical plate under development.
Alexis Lukianov, chairman and CEO of NuVasive, said that the SmartPlate’s gradient locking mechanism “represents a substantial leap in technology.” He added: “The right of first refusal on new technologies in essence expands our existing product pipeline.”
Robert Bray, MD, of Cedar-Sinai Medical Center and Marina Hospital (Los Angeles), developer of the Smart-Plate, called the system the first to provide “controlled settling of the spine onto the graft with progressive constraint of screw motion as the cervical spine naturally falls into balance. I have seen rapid incorporation of the grafts with less post operative pain . . . .”
NuVasive develops systems for treating spine disorders, putting the spine fusion market at more than $2 billion annually. Its principal products are a “minimally disruptive surgical platform” called Maximum Access Surgery (MAS), and “classic” fusion implants.
MAS combines three NuVasive product offerings: NeuroVision, a software-driven nerve avoidance system; MaXcess, a split-blade design retraction system, and specialized implants that minimize soft tissue disruption during spine surgery. Its fusion portfolio is comprised predominantly of saline packaged bone allografts and internal fixation products.
In other dealmaking: PRA International (Reston, Virginia), a global clinical research organization, said it has acquired two regulatory and product development consultancies: Regulatory/Clinical Consultants (RxCCI; Lee’s Summit, Missouri) and GMG BioBusiness (GMG; West London, UK).
PRA said that the two organizations will be integrated into its product development service offering within the Global Regulatory Affairs Group or other service groups.
RxCCI, founded in 1998, offers consultancy in regulatory affairs, electronic regulatory submissions, health economics and outcomes research and quality. Founder and CEO Diane Seif, with more than 30 years’ experience in clinical development and regulatory management, PRA said, will become vice president and lead the Global Regulatory Affairs Group.
GMG, also founded in 1998, provides regulatory and product development consulting services throughout Europe. PRA said that the acquisition of GMG doubles its European-based product development consultancy and regulatory affairs staff.
PRA also reported that Richard Bourne, PhD, with 20 years of product development and regulatory experience, has joined the Global Regulatory Affairs Group as vice president. PRA reports having more than 2,500 employees in offices in North America, Europe, South America, Africa, Australia and Asia.