NuVasive to acquire Ellipse Technologies

250

Nuvasive is to acquire Ellipse Technologies for a $380 million upfront cash payment and a potential $30 million milestone payable in 2017 according to the achievement of various revenue targets.

According to a press release, NuVasive expects to accelerate its revenue growth towards the high-single digit range as a result of this acquisition. This growth is also expected to be slightly accretive to the Company’s non-GAAP diluted earnings per share within the first 12 months and significantly accretive thereafter. NuVasive expects the transaction to support its five-year, double-digit return on invested capital goal, consistent with the Company’s previously stated acquisition criteria. 

Ellipse develops and markets a novel platform of magnetically adjustable implant systems based on its MAGnetic External Control, or MAGEC, technology. Ellipse’s novel and proprietary implants are adjustable at the time of implantation and are distracted non-invasively over the course of treatment, which is intended to accommodate the changing clinical needs of patients as they heal, grow or age. According to a press release, Ellipse’s MAGEC technology is designed to enable physicians to customise therapy for patients in a non-invasive manner, to reduce the need for further repeat surgical procedures, and to provide meaningful improvements in patient clinical outcomes and quality of life—while generating cost savings to the healthcare system.

Gregory T Lucier, NuVasive’s chairman and chief executive officer. “NuVasive remains committed to adult deformity through our Integrated Global Alignment (iGA) platform, and the acquisition of Ellipse will aggressively insert NuVasive into early onset and idiopathic scoliosis, an important and attractive part of the spinal deformity market for NuVasive where we have tremendous opportunities for accelerated growth…Ellipse’s robust product pipeline also enhances internal development and licensing opportunities for NuVasive, including areas where we look to assemble with our iGA and neuromonitoring expertise. We are very excited to welcome Ellipse’s talented team to NuVasive.”

Edmund J Roschak, president and chief executive officer of Ellipse Technologies, says, “Ellipse has made enormous strides since our founding ten years ago. Joining forces with NuVasive…provides us with the scale and resources necessary to realise our full potential…faster than we could achieve on our own. We look forward to joining with NuVasive.”

The transaction is expected to close by the end of February 2016, subject to customary closing conditions and regulatory approvals. NuVasive expects to fund the acquisition with existing cash on hand.

After the closing of the transaction, NuVasive plans to maintain a Design Center of Excellence in Aliso Viejo, California, where Ellipse is headquartered.  Roschak will join NuVasive as a member of the NuVasive executive leadership team reporting directly to Lucier.

(Visited 31 times, 1 visits today)