AngioDynamics Inc. (Nasdaq: ANGO) has acquired substantially all the assets of FlowMedica Inc., a Fremont, Calif.-based provider of targeted renal therapy solutions. The deal is valued at $1.75 million in cash, plus a possible earnout based on 2011 sales of a FlowMedica product. FlowMedica had raised over $28 million in VC funding since 2002, from Oxford Bioscience Partners, De Novo Ventures, Mi3 Venture Partners, Medica Venture Partners and Palo Alto Investors.
AngioDynamics Inc. (NASDAQ: ANGO), a leading provider of innovative medical devices used by interventional radiologists, nephrologists and surgeons for the minimally invasive treatment of cancer and peripheral vascular disease, announced today that it has purchased certain assets of privately-held FlowMedica Inc., a leader in the emerging field of Targeted Renal Therapy™ (TRT(®)). The transaction was structured as an asset purchase under which AngioDynamics will pay $1.75 million in cash for the assets of the business plus a contingent payment based on fiscal 2011 sales of Benephit products.
Pioneered by FlowMedica, TRT is a therapeutic approach that delivers drugs directly to the kidneys in order to prevent and treat acute kidney injury (AKI). AKI often results from many common interventional and surgical procedures, and is a significant problem in high renal risk patients such as the elderly and diabetics. Benephit infusion products deliver therapeutic agents directly into both renal arteries through dedicated infusion catheter and sheath systems while allowing simultaneous interventional coronary, peripheral, endovascular and surgical procedures. TRT can also be employed for stand-alone renal drug delivery in other hospital settings when desired. The Benephit systems have been granted 510(k) clearance from the FDA and the CE Mark, and are commercially available.
“With dramatically increasing volumes of interventional procedures among the high-risk patient population, the prevention and treatment of acute kidney injury is a major area of concern for caregivers,” said Paul Teirstein, M.D., Chief of Cardiology and Director of Interventional Cardiology at the Scripps Clinic in La Jolla, California, and Visiting Professor of Medicine at Columbia University Medical Center. “While employing the Benephit systems in numerous high-risk cases, I have found it simple to use and very effective in providing a significant improvement in clinical outcomes for my patients.”
“This purchase is an example of AngioDynamics’ acquisition strategy to focus on small transactions that extend our product offerings, can be sold by our sales force and have near-term revenue potential,” said Eamonn Hobbs, President and CEO of AngioDynamics. “We believe FlowMedica’s Benephit infusion systems have the potential to address the needs of patients at risk for AKI that result from common medical procedures and is also associated with certain medical conditions. This represents a significant large and unmet market opportunity with an annual value of several hundred million dollars. We intend to begin marketing the systems through our Peripheral Vascular sales team. If we are successful, this product line could become a significant contributor to our financial results in the years ahead.”
AngioDynamics has hired 10 FlowMedica employees and plans to continue to operate from FlowMedica’s Fremont, California office. In fiscal year 2009, the Company expects the FlowMedica acquisition to have a modest impact on net sales and to be $0.01 per share dilutive to earnings. In fiscal 2010, the acquisition is expected to produce incremental sales of $3 million, and to be accretive to earnings.
AngioDynamics, Inc. is a leading provider of innovative medical devices used by interventional radiologists, surgeons, and other physicians for the minimally invasive treatment of cancer and peripheral vascular disease. The Company’s diverse product line includes market-leading radiofrequency ablation and irreversible electroporation resection systems, vascular access products, angiographic products and accessories, dialysis products, angioplasty products, drainage products, thrombolytic products, embolization products and venous products. More information is available at www.angiodynamics.com.