SAN DIEGO, Jan. 13 /PRNewswire-FirstCall/ -- NuVasive, Inc. (Nasdaq:
NUVA), a medical device company focused on developing products for minimally
disruptive surgical treatments for the spine, announced today that it has
agreed to make an investment in Progentix Orthobiology BV, a Netherlands based
company focused on developing novel orthobiologics.
This investment marks NuVasive's third strategic transaction in the
biologics arena, amplifying the company's offering with a synthetic bone
substitute technology that has the potential to compete with any biologic on
the market today. Progentix is developing a synthetic bone substitute that is
designed to accelerate bone healing through a novel micro-structure created by
a proprietary manufacturing process.
NuVasive does not expect significant revenue contribution from Progentix
in 2009, but anticipates sales of the initial product offering will ramp
towards $10 million in 2010 and increase to $30 million over the next several
years. If Progentix preclinical and clinical outcomes are successful, NuVasive
believes the expanded product platform could exceed $100 million in annual
revenue. NuVasive anticipates that the Progentix investment will be dilutive
in 2009 and accretive in 2010 and beyond.
Alex Lukianov, Chairman and CEO of NuVasive said, "Progentix's impressive
preclinical data attracted us to this unique technology. We believe there is a
large product gap in the $1 billion orthobiologics market between BMP and
commodity synthetic and allograft bone graft extenders. The Progentix
material, along with Osteocel(R) Plus, will allow NuVasive to offer its
surgeon customers superior products, both synthetic and human-derived, that
fill an important market need, command premium pricing to commodity bone graft
products, and build on our FormaGraft(R) Collagen Bone Graft Matrix product
line. The investment structure simultaneously provides funding and motivation
for Progentix to continue their groundbreaking preclinical and development
efforts and secures NuVasive's long term rights to this novel technology."
The initial commitment will be $15 million in cash, consisting of a $10
million equity purchase from Progentix shareholders and a $5 million loan used
to fund ongoing clinical and regulatory efforts. Upon accomplishment of the
complete set of pre-defined development milestones, NuVasive will be obligated
to purchase the remaining equity of Progentix for $45 million (with additional
potential payments of up to $25 million upon the achievement of additional
milestones and based upon NuVasive's sales success). In addition, NuVasive
obtained exclusive worldwide distribution rights as well as an exclusive
option to purchase all of Progentix under certain circumstances.
The Progentix product portfolio currently consists of a novel family of
calcium phosphate synthetic bone substitutes. The Progentix granules have
demonstrated osteoinductive-like properties in preclinical models and require
FDA clearance via a 510(k) pathway. A putty formulation of the product is
currently under development.
About NuVasive
NuVasive is a medical device company focused on the design, development
and marketing of products for the surgical treatment of spine disorders. The
Company's product portfolio is focused on applications in the over $4.6
billion U.S. spine fusion market. The Company's current principal product
offering includes a minimally disruptive surgical platform called Maximum
Access Surgery, or MAS(R), as well as a growing offering of biologics,
cervical and motion preservation products.
The MAS platform offers advantages for both patients and surgeons such as
reduced surgery and hospitalization time and faster recovery. MAS combines
three categories of current product offerings: NeuroVision(R) a proprietary
software-driven nerve avoidance system; MaXcess(R) a unique split-blade design
retraction system; and specialized implants, like SpheRx(R) and CoRoent(R),
that collectively minimize soft tissue disruption during spine surgery while
allowing maximum visualization and surgical reproducibility. NuVasive's
product offering is also focused on cervical internal fixation products and
its R&D pipeline emphasizes both MAS and motion preservation. NuVasive's
Biologic product portfolio includes FormaGraft, Osteocel Plus, and the
Progentix products, all of which are intended to facilitate fusion and
complement the core fixation products.
NuVasive cautions you that statements included in this press release that
are not a description of historical facts are forward-looking statements that
involve risks, uncertainties, assumptions and other factors which, if they do
not materialize or prove correct, could cause NuVasive's results to differ
materially from historical results or those expressed or implied by such
forward-looking statements. The potential risks and uncertainties that could
cause actual growth and results to differ materially include, but are not
limited to: the risk that development efforts related to the Progentix
products will prove unsuccessful and the products will not have value to
NuVasive; risks associated with managing our investment in Progentix; the risk
that significant additional capital or time may be required to develop the
Progentix products; the uncertain process of seeking regulatory approval or
clearance for NuVasive's or Progentix's products or devices, including risks
that such process could be significantly delayed; the possibility that the FDA
may require significant changes to NuVasive's products or clinical studies;
the risk that products may not perform as intended and may therefore not
achieve commercial success; the risk that competitors may develop superior
products or may have a greater market position enabling more successful
commercialization; the risk that additional clinical data may call into
question the benefits of NuVasive's products to patients, hospitals and
surgeons; and other risks and uncertainties more fully described in NuVasive's
press releases and periodic filings with the Securities and Exchange
Commission. NuVasive's public filings with the Securities and Exchange
Commission are available at www.sec.gov. NuVasive assumes no obligation to
update any forward-looking statement to reflect events or circumstances
arising after the date on which it was made.
SOURCE NuVasive, Inc.
01/13/2009
CONTACT: Kevin C. O'Boyle, EVP & Chief Financial Officer of NuVasive,
Inc., +1-858-909-1998, investorrelations@nuvasive.com, or Investors: Steve
Ogilvie, Sr. Dir., Business Development & Investor Relations of NuVasive,
Inc., +1-858-638-5556, investorrelations@nuvasive.com; or Media: Jason Rando
of The Ruth Group, +1-646-536-7025, jrando@theruthgroup.com, for NuVasive,
Inc.