Fast-Growing New Wave Surgical Sold To Covidien

By Ryan Brinks

New Wave Surgical Corporation, a fast-growing healthcare products company, has been sold to Covidien for at least $100 million.

The actual price is unknown for the moment, though New Wave founder R. Alexander Gomez told the South Florida Business Journal that it was more than nine figures. The total will eventually be revealed through public filings.

Covidien became interested in New Wave after Gomez approached the investment bank William Blair for expansion capital. New Wave employs 145 people and saw $21 million in 2013 revenue, including $8 million last quarter with a 70 percent gross profit margin.

Under Covidien, New Wave’s D-HELP endoscopic visualization system, which “keeps laparoscopic and robotic lenses heated, defogged and clean during surgery,” will be sold as the Clearify Visualization System, according to a Miami Herald report. Sales of the product will benefit from Covidien's worldwide presence.

“We had been growing very quickly. We were getting orders from around the world. I knew I wanted to make [D-HELP] the standard of care. With Covidien, now it really can dominate,” Gomez told the Herald.

Perhaps the most important part of the deal was New Wave's intellectual property, as it also had several other products under development. Gomez told the Journal that “the key was to demonstrate that the patent prevented competitors from copying its product and that the law firm involved could defend it from challenges.”

New Wave had been recently ranked the fastest-growing surgical device company on Inc. Magazine's Top 500 list and just eclipsed the one-millionth procedure milestone for its D-HELP kit after opening a new state-of-the-art manufacturing facility in South Florida, according to company announcements in August 2013 and this February.

“At the end of the day, this was the goal, to have a very successful exit with the right partner who will make it a standard of care,” Gomez told the Journal. “All over the world, my product is being used. There’s a big satisfaction in that.”

Now the entrepreneur who created it all plans to start a healthcare fund to mentor and invest in other young pioneers of the industry, the Herald reported.

“I hope to help people like me,” he said. “When I started trying to raise capital, it was tough.”