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CryoLife Enters Option to Acquire Israeli Medical Device Maker Endospan
Monday 16 September 2019

16 September 2019 - US-based cardiac and vascular surgery company CryoLife, Inc. (NYSE: CRY) has entered into distribution and credit facility agreements with Israeli-based medical device maker Endospan, as well as an option agreement to purchase Endospan, the company said.

Endospan is an Israeli-based, privately-held developer of NEXUS, the only endovascular stent graft system approved for the repair of both aneurysms and dissections in the aortic arch.

The addition of NEXUS to CryoLife's highly differentiated branched aortic stent graft portfolio further strengthens the company's position as a leader in the growing aortic repair market.

CryoLife said the deal provides it with exclusive European distribution rights to NEXUS, the first branched endovascular stent graft system with CE Mark for the repair of aortic arch aneurysms and dissections

It also provides significant cross-selling opportunities with CryoLife's existing JOTEC stent graft portfolio, the company said.

The deal also gives the company immediate access to the USD 150m European endovascular aortic arch repair market.

The option to purchase Endospan for a predetermined price survives until 90 days following notice of US FDA approval for NEXUS.

Endospan has developed NEXUS, the first approved branched endovascular system to treat aortic arch disease, transforming a complex surgical aortic arch repair into a standard endovascular procedure.

It is designed for enhanced intra-procedural and long-term stability attributable to its proprietary geometrical design, which reduces arch manipulation and, hence, stroke risks.

Under terms of the agreements, CryoLife will acquire the European distribution rights for Nexus and an option to purchase Endospan for a total upfront payment of USD 10m.

Additionally, CryoLife will provide up to USD 15m in additional debt financing to Endospan subject to Endospan's progress on its US clinical trial in support of an FDA approval for NEXUS.

CryoLife expects to finance the acquisition of the distribution and option rights and debt financing out of available cash on hand.

Under the purchase option, CryoLife has the right to acquire Endospan at any time until 90 days after receiving notice of US FDA approval of the NEXUS stent graft system for a total consideration of USD 250m, plus a guaranteed USD 100m payment and up to an additional USD 100m based upon commercial success of NEXUS in the first year post-option exercise.

The distribution agreement, credit facility, and securities purchase option agreement have been approved by both companies' boards of directors and Endospan's Security Holders.

The purchase obligations of the securities purchase agreement will become effective if, and only when, CryoLife exercises its purchase option and are subject to customary conditions to closing.

Endospan has received CE-Mark to commercialize in Europe the NEXUS Stent Graft System, the first endovascular off-the shelf system to treat Aortic Arch Disease which affects a greatly underserved group of patients diagnosed with a dilative lesion in, or near, the aortic arch.

In connection with the transaction, Vinson and Elkins, LLP is acting as lead legal counsel to CryoLife. GKH Law Offices is acting as lead legal counsel to Endospan.
Details
Date Published: 16/09/2019
Target: Endospan
Country: Israel
Sector: Healthcare
Type: Corporate acquisition
Financing: Cash
Status: Agreed
Vendor:
Buyer: CryoLife, Inc
Buyer Advisor: Vinson and Elkins ,
Comment:
CryoLife will acquire the European distribution rights for Nexus and an option to purchase Endospan

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