West Palm Beach, Fla.-based Ozop specializes in surgical devices for minimally invasive spinal surgery. The company plans to purchase all existing inventory of SRI instruments and implants and use the Fort Lauderdale, Fla.-based company as a distributor. Ozop expects the agreement to begin delivering an annual run rate of $2 million in high-margin sales within the first 90 days.
The deal gives Ozop the right to sell SRI’s Swedge technology, an FDA-approved pedicle screw device plus access to a patent-pending transition rod designed to reduce contact pressure and stress shielding in the spine. It also includes SRI’s 3D-printed, polyetheretherketone and carbon-fiber products.
Access to SRI’s distributors and hospital contacts, along with Ozop’s relationships with distributors outside of SRI’s network, will allow Ozop to immediately add additional sales, the company said in a release.
“This relationship allows us to focus on developing a sustainable revenue strategy while continuing to drive innovation that treats disorders of the spine,” Ozop CEO Michael Chermak said in prepared remarks. “The combined efforts will rapidly accelerate the sales efforts already in place through Spinal Resources.”
“This venture aligned with SRI’s philosophy that innovation doesn’t occur in a vacuum, but requires dedication, passionate and inventive engagement,” added SRI founder & CEO Bernie Bedor. “What we have created is a strong demonstration of our commitment to creating a solution necessary for expanding our approach without inflating costs. The medical/device industry will be excited by Ozop’s objectives, and their continued recognition of SRI’s mission which is to support cost-effective patient care with innovative mechanical and bio-mechanical products.”
In July, Ozop entered into an equity purchase agreement with GHS Investments, giving the company access to GHS’ capital over the next 36 months.
OZSC shares surged 67.2% to a 4.9¢ close August 23 after news of the deal broke, before falling back -18.4% to a 4.0¢ close yesterday. The stock was trading at 3.0¢ today in late afternoon trading, off another -25.0%.