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Year in Review

2014: A Recap of Strategic Activities in Orthobiologics

Editor’s Note: This segment-specific article is excerpted from the full version, covering major market segments, appearing in ORTHOKNOW January 2015.

To begin 2015, let’s look back at what fueled growth in 2014 in orthobiologics. Here, we present companies that have merged and emerged, products that launched, projects that received funding. (Please note, ORTHOKNOW July 2014 features a review of 1H14 funding activity.)

Lending perspective from your peers, this issue includes insights gathered at the 2014 Musculoskeletal New Ventures Conference, as well. See companion articles, “Business Development Execs Speak on M&A and Innovation” and “Industry Investments Stay Steady, Focus on Established Technologies.”

Start-ups, spin-outs and subsidiaries identified during 2014 included:

Bone Biologics Corp.
Thousand Oaks, California, USA

  • Development stage entity (formed following a reverse merger of the privately-held company and AFH Acquisition; Musculoskeletal Transplant Foundation remains the largest shareholder)
  • Will continue development of Nell-1 bone growth factor as a lower-cost, more effective alternative to current bone growth factor products for lumbar spinal fusion

Cocoon Biotech Inc.
Brookline, Massachusetts, USA

  • Completed seed funding to support animal study and optimization of a silk-based injectable gel for the treatment of osteoarthritis
  • Conducting pre-clinical studies to demonstrate long-term efficacy of products
  • Silk microsphere lubricant product will require premarket approval, could be commercialized by 2020

Vista, California, USA

  • SeaSpine was acquired in 2Q11 by Integra LifeSciences for $89MM
  • Now spinning out as a publicly-traded company to develop, market and sell spinal hardware and orthobiologics; expected to close by end of 2015
  • Will operate as an independent entity with an estimated $140MM of trailing 12-month revenue as of 9/30/14

Seikagaku U.S.A.
Jersey City, New Jersey, USA

  • Established to support U.S. sales and marketing of products such as SUPARTZ® multi-injection and Gel-One® single-injection joint therapies
  • Parent company headquartered in Japan

Closures, restructuring and rebranding announced in 2014 included:

  • Aastrom Biosciences: Changed name to Vericel and moved headquarters to Cambridge, Massachusetts; will maintain operations and key corporate functions in Ann Arbor, Michigan. (Aastrom acquired Sanofi’s autologous cell therapies in 2Q14.)
  • Olympus Biotech: Discontinued operations and product availability in the U.S. following lack of traction to build a broader regenerative medicine portfolio

M&A Activity in 2014:

ORTHOWORLD’s Merger & Acquisition database recorded 41 transactions in 2014. The table below captures select OEM activities; visit the M&A database to see all 41, including numerous deals among suppliers.

Also announced in 2014, and not yet closed:

  • Medtronic to acquire Covidien (slated for early 2015)
  • Wright Medical merging with Tornier (slated for 1H15)
  • Zimmer to acquire Biomet (slated for 1Q15)


Acquiring Company  Acquired Company
Aastrom Biosciences (now Vericel) Sanofi Cell Therapy and Regenerative Medicine cell therapies
Bioventus Advanced Biologics' OsteoAMP, tissue-based bone biologic
Globus Medical  Transplant Technologies of Texas allografts/tissue
Zimmer ETEX bone substitutes

Fundings identified during 2H14 included:

Avitus Orthopaedics raised $1MM in capital

  • To support product commercialization, company growth; developing minimally invasive bone graft harvesting device

Bacterin awarded a $0.2MM grant from the Montana Board of Research and Commercialization Technology

  • To support development and commercialization of a novel regenerative medicine technology

Bone Biologics completed a $5MM funding round

  • To support manufacturing of UCB-1 (a.k.a. Nell-1) recombinant human protein for human clinical trials

Histogenics expects to raise net public offering proceeds of ~$57.2MM

  • ~5.9MM shares of its common stock at $11/share
  • To support ongoing Phase III clinical trial of NeoCart knee cartilage repair product, facility growth, etc.

SIRAKOSS secured £3.1MM (~$4.8MM) in Series A financing

  • To support product development and regulatory strategy implementation in Europe and the U.S. for MaxSi™ synthetic bone grafts

Tissue Regeneration Systems raised $2MM in funding

  • Developed scaffold and coating technologies for use in skeletal reconstruction

Product launches in 2014 included:

Anika Therapeutics
MONOVISC® High Molecular Weight Hyaluronan

  • 1st U.S. commercial sale as a single-injection treatment for knee osteoarthritis pain
  • First/only non-avian sourced single-injection HA approved for sale in the U.S.; available in EU since 2007
  • Received unique J-Code (J 7327) mid-4Q14
  • Sold via license agreement with DePuy Synthes Mitek Sports Medicine

RTI Surgical
Precision Allograft Cartilage Kit (PACK)

  • Instrumentation set for osteochondral allograft resurfacing
  • Designed to improve precision, minimize cartilage trauma
  • Intended to provide a more uniform cartilage contact surface, more precise fit of allograft into recipient’s socket

A portion of this article appeared in the December 2014 issue of BONEZONE®.

Sources: Company press releases, earnings calls, filings with the U.S. Securities and Exchange Commission, company web sites, articles in the public domain, etc.

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