By Matthew Willett
Genzyme Corp., which already owns 22 percent of Focal Inc., said it will acquire the remainder of the synthetic biomaterials maker.
In the stock swap using Genzyme Biosurgery shares, Genzyme will merge Lexington, Mass.-based Focal¿s operations with its Genzyme Biosurgery unit. Genzyme, of Cambridge, Mass., expects the transaction to close in the second or third quarter of this year, pending shareholder approval.
¿Prior to this deal, we were the distributor of Focal¿s only commercially available product, a sealant for lung surgery,¿ Genzyme Biosurgery¿s Executive Vice President John Connolly told BioWorld Today. ¿We had domestic rights to that product, and as a part of that distribution deal we¿ve made equity investments in Focal amouting to about $15 million, so we¿re very familiar with the company in terms of its technology and its opportunities for products and its intellecutual property position.¿
Focal shareholders will receive 0.1545 shares of Genzyme Biosurgery stock per share of Focal stock in the transaction, which will use about 2.1 million shares of Genzyme Biosurgery. At Thursday¿s opening price of $4.74 for Genzyme Biosurgery (NASDAQ:GZBX), the deal is valued at $9.95 million.
Using its polymer technology platform, Focal makes synthetic absorbable liquid surgical sealants including its flagship, the FocalSeal line of post-surgical sealants.
FocalSeal-L is intended to plug air leaks that develop during lung surgery. FocalSeal-S is aimed at sealing the dura following brain or spinal surgery and is not yet marketed. Genzyme has marketed FocalSeal-L since July 2000 in the U.S., when it made a $15 million investment in the company as a part of the marketing rights deal. Genzyme will obtain worldwide rights to FocalSeal-L as a part of the deal.
¿We¿re very pleased with the amout of institutions in the U.S. that have adopted the product, and we see some great opportunities in terms of growth,¿ Connolly said. ¿Because we¿re an equity investor and they¿re in the same area as we are we¿re very familiar with their intellectual property and intrigued by their intellectual property.¿
Genzyme¿s synthetic biomaterials line already includes Synvisc, Seprafilm and Sepramesh. Seprafilm, a bioresorbable temporary adhesion barrier for use in patients undergoing abdominopelvic surgery, serves as a barrier to separate adhesiogenic tissue surfaces. Sepramesh is a polypropylene mesh coated on one side with chemically modified sodium hyaluronate and carboxymethlcellulose, and is designed for the reconstruction of soft tissue deficiencies for the reduction of adhesion formation to a prosthesis.
Genzyme Biosurgery closed Thursday at $4.71, down 3 cents. Focal¿s stock (NASDAQ:FOCL) also lost 3 cents Thursday, closing at 70 cents.