THOMAS, MCNERNEY & PARTNERS IS LEAD INVESTOR IN OSTEOBIOLOGICS, ACQUIRED BY
SMITH & NEPHEW
Smith & Nephew Endoscopy
Acquires Privately-held Osteobiologics, Inc.
ANDOVER, MASSACHUSETTS - JULY 11, 2006
Smith & Nephew’s (NYSE:SNN; LSE: SN) Endoscopy division, the global
leader in arthroscopic surgery, announced today its acquisition of
privately-held, San Antonio-based OsteoBiologics, Inc. (OBI). OBI
markets innovative bioabsorbable bone graft substitutes (BGS) in Europe
to repair cartilage defects in the knee, and offers the TruFitTM BGS
Plugs in the U.S. as a bone void filler. OBI’s products are an exciting
addition to Smith & Nephew’s existing comprehensive arthroscopy
portfolio and will be sold through Smith & Nephew Endoscopy’s global
“We’re extremely pleased to welcome OBI and their employees to the Smith
& Nephew family,” commented Mike Frazzette, president, Smith & Nephew
Endoscopy. “Their proprietary technology will allow us to provide even
more choices to surgeons when it comes to treating injuries within the
Smith & Nephew has agreed to pay a net consideration of $72.3m in cash
for OBI, whose 2005 sales revenues were $3.3 million. The acquisition is
expected to reduce earnings by $7m in the second half of 2006 and be
broadly neutral in 2007.
OBI’s primary product marketed in Europe, TruFitTM CB is a one-step
arthroscopic procedure for repairing bone and articular cartilage
defects. Cartilage is a protective covering of the articular surfaces of
bones that reduces friction and provides flexibility within the joint.
Cartilage defects are often a result of traumatic injury or degenerative
conditions and are often found in conjunction with meniscal tears or ACL
injuries. There is strong evidence that articular cartilage defects can
lead to osteoarthritis.
Currently, less than 20 percent of cartilage defects in the knee are
treated due to the lack of an efficacious and patient-friendly solution.
“Efficacious repair of articular cartilage defects represents a
significant unmet need of sports medicine surgeons,” said Joe Darling,
VP, Marketing, Smith & Nephew Endoscopy. “The availability of OBI’s
simple-to-use TruFitTM CB will allow these defects to be treated before
they lead to additional damage within the joint.
In addition, OBI is a powerful complement to our comprehensive knee
repair product offering and further strengthens our industry-leading
The TruFit implants are manufactured with poly
(D,L-lactide-co-glycolide) polymer, formed into a bi-layered cylindrical
scaffold that is absorbed by the body within six to nine months.
About Smith & Nephew
Smith & Nephew (NYSE: SNN, LSE: SN) (www.smith-nephew.com) is a global
medical technology business, specializing in Endoscopy, Orthopaedic
Reconstruction, Orthopaedic Trauma and Advanced Wound Management
products. Smith & Nephew is a global leader in arthroscopy and advanced
wound management and is one of the leading global orthopaedics
Smith & Nephew is dedicated to helping improve people's lives. The
company prides itself on the strength of its relationships with its
surgeon and professional healthcare customers, with whom its name is
synonymous with the highest standards of performance, innovation and
trust. The company has more than 8,500 employees and operates in 33
countries around the world and generated sales of nearly $2.6 billion.
About Thomas, McNerney & Partners
McNerney & Partners, L.L.C. is a health care venture capital firm that
invests in life science and medical technology companies. The firm's
partners have successfully funded companies at all stages of their
development, having collectively invested over $600 million in more than
50 entities. With a multi-stage investment approach, Thomas, McNerney &
Partners provides seed and early stage funding to help entrepreneurs
launch companies, as well as growth capital to emerging companies for
furthering clinical development or for expansion of product
commercialization. Thomas, McNerney & Partners is targeting investments
in the pharmaceutical, medical device, biotechnology and diagnostic
sectors as well as other areas utilizing medical technology innovation.
For further information, please visit www.tm-partners.com