Artivion recently announced it has amended its credit facility and option purchase agreements with Endospan, developer of the Nexus stent graft system. In 2019, Artivion provided a credit facility to Endospan and entered into an option agreement to purchase Endospan upon US Food and Drug Administration (FDA) approval of Nexus.
The amendments announced result in three major changes to the original credit facility and option purchase agreements:
- Artivion will provide additional loans to Endospan of up to US$25 million in three tranches and anticipates funding the loans with free cash flow;
- The upfront payment associated with the purchase option is reduced from US$250 million to US$175 million, resulting in an upfront acquisition purchase price of US$135 million, inclusive of loan off-set; and
- The US$100 million minimum payout for the earnout is eliminated.
A press release details that Nexus is the first and only approved branched endovascular system to treat aortic arch disease, including both aortic aneurysms and dissections. While minimally invasive endovascular repair has been the standard of care for abdominal aortic aneurysms (AAA) and thoracic aortic aneurysms (TAA), aortic arch disease patients with aneurysms or dissections who receive treatment have previously had little choice but to undergo open-chest surgery with its associated invasiveness and risks, lengthy hospitalisations, and prolonged recuperation. According to Artivion, Nexus transforms a complex surgical aortic arch repair into a minimally invasive endovascular procedure and stands to address an annual global addressable market opportunity of US$600 million according to latest estimates.
“Based on our experience with Nexus in Europe since 2019, we continue to see a significant global opportunity for the Nexus technology and expect that it will further solidify our position as a global leader in aortic repair,” said Pat Mackin, chairman, president, and chief executive officer of Artivion. “We view our revised credit facility and option purchase agreements with Endospan as an investment in the next frontier of aortic arch surgery. Should we exercise our option to acquire Endospan, we believe we will be able to meaningfully expand our total addressable market at that time on terms more favourable than existed prior to these amendments.”
