Shortly after collecting $35 million earlier this year for its powered surgical staplers, Standard Bariatrics has found a new home through a deal with the devicemaker Teleflex.
Teleflex has signed up to purchase the company for $170 million in cash upfront, with the potential for up to $130 million in additional payments after passing certain commercial milestones.
The companies plan to complete the deal early in the fourth quarter, according to a press release. Teleflex is financing the acquisition by borrowing under its revolving credit facility.
With the deal, Teleflex gains Standard Bariatrics’ Titan SGS system, which received an FDA clearance last year. Titan SGS is designed for use in weight loss procedures and can deliver a long, continuous line of staples in a single firing.
“The acquisition of Standard Bariatrics adds an exciting and differentiated product serving the large and growing sleeve gastrectomy market, which we estimate to be approximately 120,000 procedures annually in the U.S.,” Teleflex President and CEO Liam Kelly said in the release.
In a sleeve gastrectomy, a large section of the stomach is removed, with the organ being reshaped into a tubelike structure that cannot hold as much food. The Titan SGS also provides surgeons with real-time audio and visual feeds as they form the remaining stomach tissue into the gastrectomy pouch.
Described as the first of its kind, Standard Bariatrics’ stapler aims to help surgeons avoid the variations that can come with multiple and overlapping staple placements. The goal is to provide a more secure seam and fewer chances of leaks.
Teleflex predicts Standard Bariatrics' growth with the device will continue, forecasting that by the end of its 2023 fiscal year, the acquisition will have added between $30 million and $35 million in revenue.
Shortly after its commercial launch late last year, Standard Bariatrics said sales of the surgical stapler passed the $1 million mark by November 2021, before surging to about $3 million this past February. Meanwhile, on the clinical side, the company reported in January that the device had been used in more than 1,000 procedures.
Teleflex hopes the Titan SGS will complement its existing bariatric surgery portfolio, which includes ligation devices, the MiniLap Percutaneous Surgical System and Weck EFx Fascial Closure hardware, Kelly said.