Durham, North Carolina-based Bioventus announced in April that it agreed to acquire CartiHeal in a deal worth at least $315 million. Just last month, the company amended the agreement for the deal to defer a large amount of payments.
The amendment to the acquisition agreement reduced the closing payment to $50 million in addition to the $50 million deposited into escrow last year.
Additionally, the remaining $215 million of the purchase price will instead be paid to CartiHeal stockholders upon the earlier achievement of certain milestones or the occurrence of certain installment payment dates. Israel-based CartiHeal develops orthopedic implants, including the Agili-C implant, which, in a randomized controlled trial, demonstrated superiority to either microfracture or debridement.
“We are excited to add CartiHeal to our diverse portfolio of active healing solutions,” Bioventus CEO Ken Reali said in a news release. “CartiHeal represents an important breakthrough for the treatment of osteoarthritis and osteochondral defects of the knee with significant medium- and long-term potential as evidenced by the robust data generated from its pivotal clinical trial showing superiority to current treatments.
“We believe that the addition of CartiHeal will complement our joint preservation technologies and specifically our HA business, further supporting our short- and mid-term growth drivers and helping us to deliver on our goal of sustained double-digit revenue growth. We welcome the CartiHeal team to Bioventus and look forward to bringing this life-improving technology to as many patients as possible.”
Bioventus said the acquisition of CartiHeal directly aligns with its sports medicine and total joint reconstruction businesses and extends its leadership position in joint preservation technologies. Agili-C has FDA premarket approval (PMA) and received breakthrough device designation in 2020. It is indicated for the treatment of International Cartilage Repair Society (ICRS) grade III or above knee–joint surface lesions, with a total treatable area of 1-7 cm2 for patients without severe osteoarthritis (Kellgren-Lawrence grade 0-3).
The company said it will provide adjusted earnings per share guidance reflecting its acquisition of CartiHeal on its upcoming second-quarter earnings call.