Merit Medical Systems, Inc. (Nasdaq:MMSI) today announced the completion of its acquisition of BioSphere Medical, Inc., a leading developer and marketer of embolotherapeutic products for the treatment of uterine fibroids, hypervascularized tumors, and arteriovenous malformations.
As a result of the acquisition, Merit will assume BioSphere's leading position in the embolic treatment of uterine fibroids. Merit intends to maintain BioSphere's manufacturing facility in France and a scaled-down office in Massachusetts.
"The acquisition of BioSphere is an important strategic move for Merit," said Fred P. Lampropoulos, Chairman and CEO of Merit. "We believe it will position us to capitalize on our existing distribution network and our direct sales force to achieve future growth in emerging markets such as China, in underserved markets in Europe, and in expanding markets in the United States."
Through the acquisition of BioSphere, Merit obtained a platform technology applicable to multiple therapeutic areas with significant market potential while positioning itself to leverage existing interventional radiology call points. Two immediate applications for embolotherapy are the treatment of uterine fibroids and primary liver cancer, which Merit believes represent a worldwide market potential of $650 million and $380 million, respectively. Embolotherapy has demonstrated compelling benefits to patients, physicians and payers.
Merit anticipates that the BioSphere acquisition will be dilutive to Merit's earnings per share in calendar year 2010 as a result of transaction expenses, restructuring costs and other one-time charges, but will be accretive to Merit's earnings per share in calendar year 2011 and beyond. Merit also expects to achieve sales synergies driven by adding BioSphere products into Merit's global sales channels. Merit's recent product introductions, such as the Maestro™ microcatheter and the Merit Laureate™ hydrophilic guide wire, as well as Merit's existing line of Prelude® vascular access products, complement and enhance BioSphere's product offerings, which Merit believes will create attractive opportunities to bundle complementary products. Merit also expects to recognize efficiencies through the reduction of redundant expenses in sales, marketing and general and administrative functions.
Beginning immediately, Merit intends to execute on its planned integration of BioSphere's products, technology, customers and employees to ensure a smooth transition designed to deliver immediate value for customers and shareholders.
A full report and discussion of the combined results of Merit and BioSphere for the third quarter ending September 30, 2010 will be presented during Merit's third quarter conference call, currently scheduled for October 27, 2010.
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