Opus purchase to boost ArthroCare's sports med business
This article was originally published in Clinica
ArthroCare is to acquire Opus Medical, a private developer of soft tissue orthopaedic repair systems, in a cash-and-stock transaction valued at approximately $130m. Sunnyvale, California-based ArthroCare has also agreed to a contingent payment based on Opus' 2005 net sales. The purchase includes Opus' lead product, the AutoCuff anchoring system, designed to facilitate the performance of total arthroscopic rotator cuff surgery for shoulder injuries. The system, which incorporates the SmartStitch suturing device and the Magnum knotless fixation implant, can be used in combination with ArthroCare's line of Coblation-based arthroscopic tissue modification or ablation devices, such as its ArthroWands. According to Michael Baker, president and CEO of ArthroCare, the AutoCuff System is "on track" to meet its revenue target of $16-17m by the end of this year. Since its launch in August 2003, the system has been used in more than 20,000 rotator cuff repair surgeries to date. "For a new product to capture this level of market share within a year of commercial availability is remarkable," says Mr Baker. "The addition of the AutoCuff System to our sports medicine product line will enable us to accelerate the execution of our strategic plan by at least two years," adds Jim Pacek, president of ArthroCare's sports medicine division. The company estimates that the acquisition will enable its sports medicine unit to grow by over 25% in fiscal 2005. It also projects overall product revenues for that year to increase by over 30% compared with 2004.
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