By Suzanne Hodsden
Integra LifeSciences has entered into a definitive agreement to acquire Derma Sciences, a medtech specializing in tissue regeneration for advanced wound and burn care. The $204 million deal, including cash and stock, will expand Integra’s advanced wound care portfolio to include products derived from placental/birth tissues, and accelerate growth for Derma Sciences in the global marketplace.
Integra LifeSciences, a maker of surgical instruments, orthopedic products, and orthobiologics, spun off its spine business in 2014, creating a standalone company called SeaSpine — which allowed Integra to focus on its orthopedic and tissue technologies businesses. Peter Arduini, CEO of Integra, commented that the “strategic changes” would create a stronger platform for longer-term growth in advanced wound care.
Since the spin off, Integra has completed several transactions to broaden its product offerings with complementary portfolios. In 2014, Integra purchased ear, nose, and throat (ENT) and laproscopy instrumentation lines from Medtronic. In 2015, the company completed the acquisition of TEI Medical and its surgical technology platform for reconstructive wound repair, as well as Tornier N.V.’s portfolio of total ankle replacement and silastic toe replacement products.
The acquisition of Derma Sciences will expand Integra’s offerings in regenerative technology and advance the company’s position in the advanced wound care market by adding amniotic tissue-based products, according to a press release. Derma Sciences reported $82 million in net sales for 2016, which included 38 percent growth in advanced wound care.
“Derma Sciences’ amniotic tissue-based platform technology further broadens Integra’s regenerative technology capabilities and builds upon our 3x3 wound care strategy,” said Arduini, in a separate press release. “The addition of a complementary portfolio of wound care products, including an amniotic product with reimbursement in the wound care channel, allows us to further drive scale in the advanced wound market.”
On the day the merger was announced, Derma also completed the $13.25-million purchase of the Medihoney product line of honey-based wound dressings. Following the merger, Integra plans to leverage its existing sales channels to market Derma Sciences products and increase its global presence.
Stephen Willis, executive chairman and interim principle executive officer of Derma Sciences, stated that both companies have a “significant commitment” to wound care, adding “Derma’s portfolio of biologics and advanced wound care products are a natural extension of Integra’s business, and with Integra’s global presence, our products will reach a much larger and broader set of clinicians and patients.”
Pending approvals, both companies expect to complete the merger in the first quarter of 2017, but shareholder rights law firm Johnson & Weaver has launched an investigation into whether board members from Derma Sciences “breached fiduciary duties” in establishing the sale price for Derma at seven dollars per share. According to the firm, Wall Street analysts have put the stock price closer to $8.50 per share.