Anika Therapeutics to Acquire Parcus Medical and Arthrosurface; Co. To Pay $35M In Cash Upfront

Anika Therapeutics, Inc. (NASDAQ:ANIK), a global, integrated joint preservation and regenerative therapies company with products leveraging its proprietary hyaluronic acid (HA) technology platform, today

Benzinga · 01/06/2020 13:31

Anika Therapeutics, Inc. (NASDAQ:ANIK), a global, integrated joint preservation and regenerative therapies company with products leveraging its proprietary hyaluronic acid (HA) technology platform, today announced it has signed agreements to acquire Parcus Medical, a leading, privately-held sports medicine company, and Arthrosurface, a leading, privately-held provider of joint surface and preservation solutions for active patients.

"We are very excited about these acquisitions, which are consistent with Anika's commitment to expanding our portfolio into replacement and regenerative therapies for joint preservation and restoration," said Joseph Darling, President and Chief Executive Officer of Anika Therapeutics. "These acquisitions will significantly enhance our commercial capabilities and infrastructure, diversify our revenue mix and expand our product portfolio and pipeline. Parcus Medical provides direct access to the high-growth ambulatory surgery center market, which will enable Anika to source new revenue streams, and Arthrosurface has an innovative product pipeline and an established direct hybrid sales model, which will accelerate our product platform strategy. Importantly, we are confident that these acquisitions, together with our existing product portfolio, will solidify Anika's position in the $7 billion sports and regenerative medicine market and strengthen our ability to deliver better patient experiences and drive sustained revenue growth that will ultimately enhance value for shareholders."

The company expects the Parcus Medical and Arthrosurface acquisitions to drive growth by:

  • Broadening Anika's product portfolio into joint preservation and restoration;
  • Adding high-growth and diversified revenue streams;
  • Strengthening its commercial capabilities with approximately 40 direct sales representatives and approximately 150 distributors in the U.S., as well as more than approximately 70 international distributors; and
  • Expanding its product pipeline and research and development expertise.

Parcus Medical Acquisition

Under the terms of the agreement, Anika will acquire all outstanding membership interests of Parcus Medical in exchange for an upfront payment of approximately $35 million in cash from the company's existing balance sheet, subject to customary closing adjustments. In addition, Parcus Medical unitholders will be eligible to receive an additional $60 million contingent upon the successful achievement of certain commercial milestones. Parcus Medical is expected to generate approximately $12 million to $13 million of revenue for the full year of 2019, an increase of approximately 15 percent compared to the prior year.