Temecula, Calif.-based Brightwater Medical’s lead product, ConvertX, is a device designed to treat severe obstructions of the ureter. The company recently won FDA clearance for its ConvertX biliary stent system, according to Merit Medical.
The deal includes a $35 million upfront payment and potential payments of up to $15 million contingent upon CE Mark approval and future sales targets.
Merit Medical reported that it will keep Brightwater Medical’s production capabilities in Temecula and duplicate those capabilities in a Pearland, Texas-based facility. Eventually, Merit Medical plans to transfer the ConvertX manufacturing operations to the Pearland facility.
Management estimated that the deal will be 5¢ decretive to GAAP EPS and 3¢ decretive to non-GAAP EPS in 2019. The company pegged sales expectations for the ConvertX product at $1 million for 2019, adding that it expects sales to grow to $25 million by the fifth full year of sales.
“The ConvertX system is designed to reduce multiple visits to the hospital, saving patients the risk and discomfort of a second interventional procedure while allowing additional utilization of facilities,” Merit Medical’s chairman & CEO Fred Lampropoulos said in prepared remarks. “The ConvertX system complements Merit’s Resolve drainage catheter portfolio and potentially drives pull-through of other Merit products such as InQwire guide wires, Advocate PTA balloons and other vascular products.”