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Mergers & acquisitions and funding investments signal interesting new technologies and important company moves. After experiencing a decline in 2021, we’ve seen an uptick in M&A and funding announcements in the first half of 2022, a few of which we’ve recapped here. In spotting trends amongst this activity, spine is a ripe market for funding and foot and ankle for M&A activity.
Funding Announcements
3Spine Raises $33 Million for Lumbar Joint Replacement
3Spine, developer of a total joint replacement for the lumbar spine, raised $33 million in an oversubscribed Series C private offering. The proceeds will support a Phase II clinical study of the BalancedBack Total Joint Replacement in the U.S.
3Spine’s MOTUS device, the implant used in the BalancedBack Total Joint Replacement procedure, replaces the function of the disc and facet joints through a posterior approach. The procedure broadly addresses leg pain, back pain and spinal instability, while correcting posture and restoring freedom of movement by reconstructing the functional spinal unit.
MOTUS was designated a Breakthrough Device by FDA in 2020 and in early 2022, the American Medical Association assigned a CPT Code to track outpatient utilization of lumbar total joint replacement as a new procedure.
Carlsmed Closes Series B to Ramp Personalized Spine Implants
Carlsmed closed an oversubscribed $30 million Series B funding round, The company plans to use proceeds to ramp commercialization of aprevo, Carlsmed’s FDA-cleared personalized surgical devices.
In 2020, the company closed a $10 million Series A financing to commercialize a digital + surgical planning solution and personalized aprevo implants for the correction of adult spinal deformity. Carlsmed was granted FDA 510(k) clearance and Breakthrough Device Designation for aprevo.
Companion Spine Raises $55 Million to Develop Alternatives to Spine Fusion
Companion Spine seeks to offer an alternative to options such as spine fusion. The company’s product portfolio stems in part from an acquisition from Medtronic in 2020 of regulatory and clinical property, including a portfolio of six patent families covering more than 140 patents, as well an inventory of instrument and implant sets.
Two of the company’s products are expected to be commercialized in the U.S. in 2023. The DIAM implant for the treatment of degenerative disc disease is CE Marked. It received the Breakthrough Device designation from FDA in 2021. The second product is the APERIUS intervertebral implant for the percutaneous treatment of lumbar stenosis.
Companion Spine raised $55 million in a Series A financing led by Viscogliosi Brothers. Funds will support the development and commercialization of minimally invasive diagnostic and therapeutic solutions to treat degenerative disc disease and lumbar spinal stenosis.
Neo Medical Raises $20 Million to Support AR Platform
Neo Medical closed a $20.6 million financing round. Proceeds will support commercial deployment of the ADVISE augmented reality platform for spinal surgery, with a particular focus on the U.S. market.
ADVISE complements the company’s optimized universal implants and smart instruments, resulting in a total technology ecosystem for spinal surgery. The system supports enhanced outcomes at each stage of the perioperative process: preoperative planning, intraoperative actions and postoperative recovery.
Osteal Therapeutics Targets Joint Infection
Osteal Therapeutics completed an oversubscribed $30 million Series B equity financing. The proceeds will enable Osteal to continue development of its integrated technologies, advance the clinical development of its lead candidate VT-X7 for treatment of periprosthetic joint infection and fund new research.
VT-X7 (vancomycin HCL and tobramycin sulfate for irrigation) is a novel drug/device combination product designed to deliver therapeutic concentrations of vancomycin and tobramycin, broad-spectrum antibiotics, directly to the joint space and surrounding tissue to treat chronic periprosthetic joint infection.
In a Phase II clinical trial, 100% of VT-X7 patients were treated and received a new permanent joint prosthesis in seven days with 93% remaining infection-free at one year. The company recently commenced enrollment of APEX, a randomized controlled study of VT-X7 in patients with chronic periprosthetic infections of the hip or knee.
Merger & Acquisition Activity
DePuy Synthes Makes 2 Acquisitions
DePuy Synthes started 2022 with the acquisitions of CUPTIMIZE and CrossRoads Extremity Systems.
CUPTIMIZE Hip-Spine Analysis is a tool to help surgeons better understand and address the impact of abnormal motion between the spine and pelvis in some patients who require total hip replacement. CUPTIMIZE Hip-Spine Analysis is designed to enhance the surgical planning capabilities of the DePuy Synthes’ VELYS Hip Navigation.
DePuy Synthes also acquired CrossRoads Extremity Systems to expand its elective foot and ankle portfolio. CrossRoads provides procedure-specific, sterile-packed implants and instruments, including miniBunion 3D, dynaBunion 4D and DynaForce Staple Compression Plates. CrossRoads also brings the EcoSMART Instrument Service which provides sterilized, reusable instruments for surgical cases, along with post-surgery instrument recovery and processing, to help reduce waste and inefficiencies.
Medartis Expands U.S. Business with Nextremity Acquisition
Medartis announced intends to acquire Nextremity Solutions for up to $70 million.
Nextremity Solutions designs, develops and manufactures indication-specific technologies to treat fractures and deformities in lower and upper extremities. The Swiss-company gains access to an R&D team, relationships to U.S. design surgeons, a complementary product pipeline, IP portfolio, product knowledge and a regional manufacturing base.
Medartis views this transaction as a catalyst for its extremities business in the U.S. and possibly elsewhere.
CONMED Seeks to Purchase In2Bones
CONMED announced a definitive agreement to acquire In2Bones Global for cash consideration of $145 million at closing and up to an additional $110 million in growth-based earnout payments over a four-year period. The transaction is expected to close late in 2Q22 or early 3Q22.
Headquartered in Memphis, Tennessee, In2Bones is a global developer, manufacturer and distributor of medical devices for the treatment of disorders and injuries of the upper (hand, wrist, elbow) and lower (foot and ankle) extremities. The company’s product portfolio includes implants, fracture systems, biologics and related hardware.
“In2Bones is an exciting platform for CONMED to enter the extremities market given its broad portfolio, extensive sales channel, and experienced leadership team,” said Curt Hartman, CONMED’s President and CEO.
