Agili-C is a porous, biocompatible, and resorbable scaffold for cartilage regeneration in the knee.
[Image courtesy of CartiHeal and Smith+Nephew]
Smith+Nephew (LSE:SN, NYSE:SNN) announced today that it has agreed to acquire CartiHeal and its novel sports medicine technology.
CartiHeal’s Agili-C is an off-the-shelf, porous, biocompatible, and resorbable scaffold. Approved by the FDA in 2022, it promotes natural regeneration of the articular cartilage — and restoration of its underlying subchondral bone.
Under the acquisition agreement, Smith+Nephew will pay an initial $180 million for CartiHeal. There’s also the potential for CartiHeal’s present owners to receive a further $150 million contingent on financial performance.
“The acquisition of this disruptive technology supports our strategy to invest behind our successful Sports Medicine business,” S+N CEO Deepak Nath said in a news release. “Agili-C’s superior clinical performance makes it highly complementary to our existing knee repair portfolio, and with our proven commercial expertise in high-growth biologics, we are confident that we will drive further success with this compelling treatment option.”
The FDA granted a PMA for Agili-C based on the results of a two-year randomized controlled trial involving 251 people with mild and moderate osteoarthritis. According to CartiHeal, the trial confirmed the superiority of Agili-C over the current standard of care — microfracture and debridement for treating knee joint surface lesions,
At four-year follow-up, CartiHeal has found that the trial continues to show significant improvement in patient-reported outcome scores and low surgical intervention. CartiHeal argues that the difference in improvement using Agili-C compared to the standard of care is statistically significant – offering the potential for a new standard of care in cartilage repair.
The companies expect the transaction to close in the first quarter of 2024, with a breakeven to trading profit targeted by 2027.
“We have shown with Regeneten that we have the market development and commercialization expertise to take novel technologies and successfully establish a new standard of care,” said Scott Schaffner, president of Sports Medicine at Smith+Nephew. “Agili-C is the perfect addition to our portfolio, and we look forward to leveraging our expertise to transform cartilage repair outcomes for patients.”