Showing all posts written by Mark Speegle

Mark Speegle
Gilead to Acquire Kite Pharma for $11.9 Billion

Gilead to Acquire Kite Pharma for $11.9 Billion

Gilead Sciences, Inc. recently announced an agreement to acquire Kite Pharma, Inc. for $11.9 billion.  According to the announcement, Kite Pharma focuses on cell therapy treatment for cancer, which involves the genetic engineering and reintroduction of a patient’s own cells to better identify and combat cancers.

(Graphic from Kite Pharma website)

With the announcement, Gilead’s President and CEO stated that “cell therapy has advanced very quickly, to the point where the science and technology have opened a clear path toward a potential cure for patients[,]” and the acquisition “establishes Gilead as a leader in cellular therapy[.]”  The announcement notes that Kite Pharma’s treatment for non-Hodgkin lymphoma is currently under review by the FDA, with a target action date of November 29, 2017.

Kite Pharma, Inc. is based in Santa Monica, CA and Gilead Sciences, Inc. has its U.S. headquarters in Foster City, CA.

Former Lutonix VP Pleads Guilty to Trade Secret Theft

On May 9, 2017, according to court records, Christopher Barry, former Vice President of R&D at Lutonix Inc., pled guilty to stealing Lutonix’s trade secrets in the form of several confidential electronic files.  According to the Plea Agreement, the allegedly stolen files relate to Lutonix’s proprietary design and manufacture of drug coated balloons, in particular the Lutonix 035 DCB.  The Plea Agreement stated that sales for the Lutonix 035 DCB, depicted below, exceeded $50 million in 2015.

The factual background provided in the Plea Agreement reports that, following his departure from Lutonix, Barry took a position as CEO of Urotronic, a medical device startup developing its own drug-coated balloon.  According to the Plea Agreement, Barry disclosed the contents of the purportedly stolen files to others at Urotronic.  However, according to news articles, following entry of Barry’s guilty plea, Urotronic denied that Barry had any involvement in the development of the Urotronic technology.

Ethicon To Acquire Torax Medical, Inc.

Ethicon Inc. announced on February 17 that it reached an agreement to acquire Torax Medical, Inc.  According to its website, Torax Medical is a privately held medical device company developing a minimally invasive surgical treatment for GERD acid reflux known as the LINX system. The website indicates that the LINX system supports the body’s barrier between the stomach and esophagus with a band of interlinked titanium beads.  The beads are said to have a magnetic core, and the magnetic attraction between the beads helps close the division between the stomach and esophagus after swallowing.

Ethicon stated in its announcement that the transaction would “enable Ethicon to offer patients a safe and effective alternative to the anatomy-altering laparoscopic Nissen fundoplication surgical procedure.”

The financial terms of the deal have not been disclosed. A previous press release noted that Torax Medical completed a $25 million Series E financing round in August 2016, led by Johnson & Johnson Innovation – JJDC and existing investors including Sanderling Ventures, Thomas McNerney & Partners, Accuitive Medical Ventures, Kaiser Permanente Ventures, Piper Jaffray Companies, and Mayo Clinic Ventures.

Ethicon is a subsidiary of Johnson & Johnson, and has headquarters in Somerville, NJ, and Cincinnati, OH.



InSeal's InClosure VCD, before and after biodegredation.

InSeal Medical Receives CE Mark for Vascular Closure Device

InSeal Medical recently announced that it has received CE Mark approval for its InClosure large bore vascular closure device (VCD).  The InSeal VCD provides an internal biodegradable membrane for sealing large cuts in blood vessels.  The figures below show InSeal’s InClosure VCD, before (left) and after (right) biodegradation.

According to PRNewswire, the need for such a device is, at least partially, driven by the increased prevalence of transcatheter heart valve procedures, which involve the delivery of relatively large medical device through a patient’s blood vessels.  While superior in some respects to open-heart surgical alternatives, these transcatheter procedures still require making a large puncture in a blood vessel in order to introduce the medical device.  The InClosure device is aimed at addressing these punctures.

InSeal Medical, Ltd. is a subsidiary of E-Pacing, Inc., and is based in Caesarea, Israel.

HeartWare Cancels $930M Deal with Valtech Cardio

HeartWare International, Inc. has announced that it will not longer proceed with its previously announced deal to acquire Valtech Cardio, Ltd.  Valtech is a privately held Israeli company developing transcatheter mitral and tricuspid replacement and repair therapies.  Back in September of 2015, HeartWare announced a definitive agreement to acquire Valtech for a combination of stock and cash estimated to be worth $930 million.  HeartWare’s President and CEO, Doug Godshall, made statements that the new decision to terminate the proposed deal with Valtech was not a reflection on Valtech’s technology:

“While we continue to believe Valtech’s portfolio of mitral and tricuspid interventional tools holds tremendous promise, HeartWare finds itself in a different set of circumstances than when we first entered into the agreement.  Our focus in the coming months will be on returning the MVAD System to the clinic, further enhancing the HVAD System, particularly in light of our plan to submit for the Destination Therapy indication for HVAD in the middle of this year, and progressing our innovative circulatory support pipeline[.]”

The termination follows several months of shareholder disputes and a decline in HeartWare’s stock price. As a result of this termination, HeartWare will be providing Valtech with a $30 million dollar loan.  HeartWare International, Inc. is a publicly traded company focused on miniaturized implantable heart pumps for treating patients from advanced heart failure, having its corporate headquarters in Framingham, Massachusetts.


HeartWare International To Acquire Valtech Cardio

HeartWare International recently announced that it has entered into a definitive agreement to acquire Valtech Cardio, Ltd.  Yehuda, Israe-based Valtech Cardio currently provides a transcatheter mitral valve repair product for the treatment of mitral regurgitation, the Cardioband, and is also working on a transcatheter mitral valve replacement product, the Cardiovalve.  Traditional treatment options for mitral regurgitation require open heart surgery–however, many patients suffering from mitral regurgitation are too weak to undergo that surgery.   As reported, the deal could approach a total value of nearly one billion dollars, but the final number depends heavily on the Valtech Cardio products reaching future milestones such as acquiring CE Mark approval and hitting net sales totals.

Valtech Cardio is the third company developing a transcatheter mitral valve to be acquired in the last two months, following the acquisitions of CardiAQ by Edwards Life Sciences, and of Twelve, Inc. by Medtronic.  HeartWare International is a publicly traded medical device company focused on implantable cardiovascular devices.  HeartWare International’s corporate headquarters are located in Framingham, Massachusetts.

VertiFlex Announces FDA Approval of Superion Interspinous Spacer System

By: Mark Speegle

(May 26, 2015) VertiFlex, Inc., announced that it has been granted pre-market approval by the FDA for its minimally invasive treatment of lumbar spinal stenosis, the Superion Interspinous Spacer System.  This approval comes after a successful 470 patient IDE study of the Superion system.  VertiFlex’s press release highlighted the following results from the IDE study:

  • Largest, most robust IDE device trial for moderate lumbar spinal stenosis
  • Superion demonstrated clinical success of >80% in all major components of the composite primary endpoint at 24 months, maintaining durability of effect through 36 months
  • Superion patients exhibited similar leg pain improvement, as measured by VAS, compared to published literature on open surgical decompression
  • Healthcare economic data was captured, demonstrating Superion’s cost-effective equivalency to open surgical decompression

The press release also notes that Superion has already been successfully implanted in more than 2,000 patients internationally.  VertiFlex was founded in 2005 and is based in San Clemente, CA.

FDA Approves Expanded Use of Medtronic’s CoreValve System; Also Receives Regulatory Approval in Japan

This week the U.S. Food and Drug Administration announced its approval of Medtronic’s CoreValve system for “valve-in-valve” (VIV) replacement. According to the FDA press release, this represents the first transcatheter aortic valve replacement device approved for use in replacing a previously implanted artificial valve. The press release explained the need for replacing artificial valves over time:

Some patients whose own aortic valve failed to work properly in the past undergo open-heart surgery to replace the faulty valve with an artificial heart valve. Over time, artificial valves that are made of animal tissue wear out—becoming narrowed, leaky or both—and may need to be replaced again.

The press release notes that prior to this approval, the only option for patients needing to replace an artificial aortic valve was open heart surgery; however, some such patients may not be qualified candidates for open heart surgery.  The press release also stated that the CoreValve system can now provide a less invasive alternative for replacing artificial valves, thereby opening the option of subsequent valve replacements to a new category of patients. Medtronic provided data on the CoreValve Expanded Use Study Failed Bioprosthetic Surgical Valve on its website.

According to press releases, the CoreValve system also just received regulatory approval in Japan, in addition to previous regulatory approval in the U.S. and Europe.


DePuy Synthes Announces Acquisition of Olive Medical

By: Mark Speegle

(Feb. 11, 2015)  DePuy Synthes, a Johnson & Johnson company, announced its acquisition of Olive Medical Corporation in a press release.  The financial terms of the deal were not disclosed.  According to its website, Olive Medical is a medical device company specializing in high-definition imagining equipment for minimally invasive surgery.

The press release notes that Olive Medical’s imaging technology is expected to complement DePuy Synthes’s existing Mitek Sports Medicine portfolio, which includes multiple systems designed for surgical use with such visualization technology in the operating room.  The press release also stated that the deal will allow DePuy Synthes to integrate Olive Medical’s imaging equipment into its own systems for a single source offering.

According to its website, DePuy Synthes is a worldwide provider of a variety of orthopedic and neurological medical products, and has its North America headquarters in West Chester, Pennsylvania.

California Healthcare Institute Releases 2015 California Biomedical Industry Report

By Mark Speegle

(Nov. 20, 2014)  The California Healthcare Institute and PricewaterhouseCoopers, LLP have released their 2015 California Biomedical Industry Report describing industry trends through 2014.  The CHI report highlights the continued strength of the biomedical industry in California:

California holds a unique position in the worldwide life sciences community.  Golden State companies are leaders, producing some of the world’s most innovative therapies and diagnostics.  In turn, these corporations have made the state’s life sciences industry an economic juggernaut.

The report indicates that California leads all states in biopharmaceutical and medical device employment, with 767,300 direct or indirect industry-attributable jobs. According to the report, the success of California biomedical industry begins at the academic research level, where California academic institutions received $3.3 billion dollars in NIH grants in 2014, $1 billion more than the institutions in any other state.  The report concludes that more basic scientific discoveries funded by such grants translates into more commercial products and biotech start-ups.

The CHI report also describes the continued prominence of venture capital investments in California biomedical companies.  The report notes that investments in California companies account for approximately 45% of all venture capital investments in medical device companies, with an estimated $1.1 billion dollars invested in 2014, and that notably, venture capital investments in California medical device seed stage companies are projected to rebound to $33 million in 2014, up from $9 million in 2013, as illustrated in the chart excerpted from the report reproduced below:

The CHI report states that 70 M&A deals targeting California biomedical companies have been completed as of September 2014, matching the total for all of 2013.  Through September 2014 there have also been 20 IPOs for California biomedical companies bringing in a total of $1.5 billion, compared to 17 IPOs in all of 2013.

Recent events have also been consistent with the CHI report’s conclusions regarding the strength of biomedical M&A activity in California. On November 17th, Allergan, based in Irvine, CA (NYSE: AGN) agreed to be acquired by Actavis Plc for $66 billion, after Valeant Pharmaceuticals abandoned its attempts to purchase Allergan.

As yet another example, Second Sight Medical Products, Inc., based in Sylmar, CA (Nasdaq: EYES) raised $32 million in an IPO on November 19th , and the stock has more than doubled with respect to its IPO price. According to its website, Second Sight develops implantable prosthetic devices that could potentially restore functional vision to patients that suffer from retinal degeneration.