Atlanta, Ga.-based Cryolife said it had the option to purchase the patches after acquiring the distribution rights and a purchase option for PhotoFix in August 2014.
“PhotoFix is a highly differentiated product that complements our expanding portfolio of cardiac surgery products. We achieved $1.4 million in PhotoFix sales in 2015 and have a significant opportunity to continue driving adoption in the market, particularly with our expanded cardiac surgery sales force that doubled in number following the acquisition of On-X earlier this year. We believe PhotoFix’s photo-oxidation process is unique and provides clinical advantages that will support its sales growth and ultimately its adoption as a leading biological patch in the $30 million market for cardiac surgery,” CryoLife CEO J. Mackin said in a press release.
Through the agreement, CryoLife acquired all rights to the PhotoFix patch for $2.3 million, including $600,000 previously paid to Genesee as an advance under the distribution agreement.
Genesee said it agreed to continue to supply PhotoFix to CryoLife until CryoLife can establish manufacturing capabilities, which it said it anticipates it will be capable of by mid 2017.
The Hero graft put up $7.5 million in sales for CryoLife last year, the Atlanta-based company said. The deal calls for CryoLife to continue manufacturing the device for up to 6 months, when Salt Lake City-based Merit will take over production.
COO/CFO Ashley Lee said CryoLife plans to use the proceeds to pay down some of the $75 million term loan it took out for the $130 million acquisition of On-X.