Deals roundup: Navilyst formed by spin-off of several Boston Scientific assets

A Medical Device Daily

Boston Scientific (Natick, Massachusetts) has spun off a new company, dubbed Navilyst Medical (Marlborough, Massachusetts), its assets consisting of Boston Sci's old fluid management and vascular access business, acquired by private equity firm Avista Capital Partners in February for $425 million (Medical Device Daily, Feb. 15, 2008).

Navilyst said its fluid management business, including the NAMIC line of products, enjoys a leading global market share. Its vascular access products include devices designed to provide access to the blood stream for patients requiring intravenous antibiotics, nutrition, chemotherapy, blood sampling and hemodialysis. The company's PASV Technology is designed to automatically close after infusion, disconnection or aspiration, and remain closed during normal pressure fluctuations, reducing the risk of complications including catheter-related bloodstream infections.

Navilyst is a $180 million company with 800 employees. The company sells its products globally, though its main U.S. manufacturing facility is located in Glens Falls, New York.

Dave McClellan, president of Navilyst, said the company will be launching several new products within the next year.

In other dealmaking activity:

Integra LifeSciences Holdings (Plainsboro, New Jersey) reported acquiring Theken Spine, Theken Disc, and Therics (all Akron, Ohio), companies focused on improving spinal surgical techniques, for $75 million in cash, and up to $125 million in milestones based on revenue performance of the business in the two years following closing.

Integra said it expects to provide detailed guidance regarding the financial aspects of the deals and expected impact on its future financial results during its 2Q earning conference call on Aug. 12.

Theken Spine, founded in 1998, develops spinal fixation products, specializing in spinal implant technologies that seek to improve spinal surgical techniques. Theken Spine products include cervical plates, pedicle screws, spacers, and degenerative/deformity and trauma devices. Theken Disc is a research-stage company developing spinal arthroplasty products, including the eDisc, a microelectronic artificial spinal disc replacement. Therics founded in 1996, designs synthetic bone substitute products.

Theken generated about $34 million in revenue in 2007, its revenue growing at a compound annual growth rate of 21% over the last two years. It has been a profitable company for several years.

"Theken is an ideal strategic fit for Integra and will form the backbone of our spine strategy going forward,'' said Stuart Essig, Integra's president/CEO. This combination brings together two well-respected industry leaders in the neuro-ortho device marketplace. Both Integra and Theken provide some of the most advanced technology addressing surgeons' needs."

Randy Theken, founder of Theken Spine and Theken Disc, and the other managers at Theken will join Integra and lead Integra's newly-created spine division. Integra said it expects to retain all Theken employees, as well as the Theken HQ and manufacturing facilities in Akron.

Integra's spine division will operate under the Integra NeuroSpine umbrella but will function independently of the Integra OrthoBiologics and the Integra NeuroSciences selling organizations.

Integra said it will integrate the Therics research operations in Morrisville, Pennsylvania, with its Plainsboro, New Jersey activities.

Veridex (Raritan, New Jersey), a business of Johnson & Johnson (New Brunswick, New Jersey) making in vitro diagnostic oncology products, reported closing its previously disclosed acquisition of the assets of Immunicon (Huntingdon Valley, Pennsylvania) and its wholly-owned subsidiaries for $31 million, that deal first unveiled in June (MDD, June 12, 2008).

The assets, acquired just after Immunicon filed for Chapter 11 bankruptcy, include intellectual property, product inventory and clinical data, as well as all technologies related to the CellSearch System, the first diagnostic test to automate the detection and enumeration of circulating tumor cells (CTCs), cancer cells that detach from solid tumors and enter the blood stream. The system is currently cleared for the prognosis and monitoring of patients with metastatic breast, metastatic colorectal and metastatic prostate cancer.

Veridex also acquired all technologies related to Repeat-Free (RF) Poseidon Fluorescent In-Situ Hybridization (FISH) Probes, which it called the latest advance in FISH DNA probes.

Veridex and Immunicon have partnered since 2000 to develop cancer diagnostic platforms and products.

However, in March, Immunicon lost an arbitration ruling in which it alleged that Veridex did not devote "best efforts" to market CellSearch. Following the decision, Immunicon said it would cut 40% of its full-time staff. And in April, it retained Stifel, Nicolaus & Co. to advise it concerning alternatives, including possible sale.

Immunicon said net proceeds from the asset sale will first be used to pay creditors, and any remaining proceeds will be distributed to stockholders on a pro rata basis.

VWR International (West Chester, Pennsylvania), a laboratory supply company, reported acquiring Spektrum-3D Kft (Debrecen, Hungary), a private scientific laboratory supply distributor.

Spektrum-3D distributes laboratory chemicals, consumables, furniture, equipment and instrumentation to laboratories throughout Hungary, including customers in the pharmaceutical and chemical industries and scientific research institutes.

Manuel Brocke-Benz, senior VP and managing director of European operations for VWR, said, "This acquisition demonstrates our ongoing commitment to the Central and Eastern European markets and our intention to expand our product and service offerings globally. VWR started penetrating these markets a number of years ago through our export operations but have successfully developed a local supply chain in recent years to provide improved service to our valued customers."

Almost Family (Louisville, Kentucky), a provider of home health nursing services, reported completing the previously disclosed $45.2 million acquisition of Patient Care (Hamden, Connecticut). This acquisition, which the company said is its largest to date, expands its presence in the Northeast with three locations in New Jersey, one in Pennsylvania, and four in Connecticut. Almost Family now operates 89 branches across 11 states.

Almost Family also assumed about $1.3 million in capital lease obligations. Due to the transition, wind-down costs and closure timing, the acquisition is not expected to contribute significantly to earnings in 2008 but is expected to be accretive to EPS in 2009.