Devicemaker Orthofix is acquiring Spinal Kinetics, which manufactures artificial cervical and lumbar discs, in a deal that could be worth up to $105 million.
Under terms of the agreement, $45 million in cash will be paid upfront with an additional $60 million at stake given certain milestones are reached, including FDA approval of the M6-C cervical disc and if trailing 12-month sales targets of $30 million and $50 million are hit, the company said.
Spinal Kinetics’ M6-C cervical and M6-L lumbar artificial discs are designed for patients suffering from degenerative disc disease of the spine. These devices mimic the structure of a natural disc by using an artificial visco-elastic nucleus and fiber annulus that provides 6 degrees of motion, similar to a natural disc.
“This technology is a significant advancement in mimicking the natural motion of the spine, which we believe will be very beneficial to patients and well received by our surgeon customers,” Brad Mason, Orthofix’s president and CEO, said in a statement. “This acquisition is very well aligned with our value creation strategy of accelerating topline growth by investing in faster growing market segments in our core businesses.”
The M6 artificial discs have already received a CE Mark and Spinal Kinetics has submitted a PMA to the FDA for the M6-C cervical disc to be used in treating single level cervical degenerative disc disease. More than 54,000 implants of the M6-C and M6-L have been done globally since the devices were launched in 2006.