Bioventus Plans Acquisition of Orthopedic Device Maker CartiHeal
Durham-based Bioventus is getting bigger.
The medical device company has opted to acquire fellow orthopedic device maker CartiHeal following U.S. Food and Drug Administration (FDA) approval of its Agili-C cartilage repair implant. The product is expected to be a cost-effective solution for cartilage regeneration and bone remodeling that can delay total knee replacement in some patients.
Bioventus acquired a $15 million equity position in CartiHeal in 2020 and said it is offering $315 million to buy the remaining shares of the Israeli startup. An additional $135 million will be paid when CartiHeal achieves $100 million in trailing 12-month sales. Bioventus said it will finance the acquisition with additional debt.
The Agili-C implant is designed to treat tears or fractures in and around the knee joint by helping to regenerate affected cartilage and bone. The FDA granted Breakthrough Device Designation to the product in 2020. Bioventus now plans to change the name of the product to CartiHeal.
Bioventus CEO Ken Reali said the implant device "represents an important breakthrough for the treatment of osteoarthritis and we are excited to bring this complementary product into our growing portfolio of medical devices."
Bioventus said the transaction is expected to close during the second quarter of this year, with a limited U.S. market release of the implant planned for the third quarter. The company said the device could address an unmet need in joint preservation and cartilage regeneration for approximately 675,000 patients annually, representing an estimated $1.3 billion market opportunity.
Established in 2012, Bioventus was formally the biologics and clinical therapies division of Smith and Nephew, a publicly traded medical equipment manufacturer based in the United Kingdom. Bioventus currently operates in more than 50 countries and has close to 1,160 employees globally.
In addition to its Durham headquarters, Bioventus has offices in Memphis, Tennessee; Valencia, California; Farmingdale, New York; and Mississauga, Ontario, Canada. It has a manufacturing location in Hod Hasharon, Israel and its international headquarters are in Hoofddorp, The Netherlands. Bioventus announced its first public offering of stock in 2021.
The company said its products will help more than 600,000 people regain active lifestyles this year.