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Furthers transformation strategy with vascular expertise and R&D
capabilities
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Brings unique catheter-based technology and development capabilities
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Raising revenue guidance to adjusted range of $62 million to $66
million
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GAAP EPS in range of $0.30 to $0.35 per share; non-GAAP EPS
unchanged at $0.66 to $0.75 per share
SurModics, Inc. (Nasdaq:SRDX), a leading provider of medical device and in
vitro diagnostic technologies, today announced it has acquired
NorMedix, Inc., a privately owned design and development company focused
on ultra thin-walled, minimally invasive catheter technologies based in
Plymouth, Minn. This acquisition strengthens SurModics’ vascular device
expertise and research and development (R&D) capabilities. Along with
the recent acquisition of Creagh Medical, the addition of NorMedix
positions SurModics to make significant progress on its strategy to
offer whole-product solutions to medical device customers, while
continuing its commitment to consistently deliver innovation in coating
technologies and in vitro diagnostics.
These strategic acquisitions combines the best-in-class capabilities of
NorMedix’s catheter-based technologies, Creagh Medical’s percutaneous
transluminal angioplasty (PTA) balloon platform capabilities, and
SurModics’ innovative coating and drug delivery technologies to develop
highly differentiated delivery and therapeutic intravascular solutions.
The result is an organization with unique device design and development
expertise, rich technology content, manufacturing capabilities, and a
state-of-the-art facility equipped for medical device R&D and
manufacturing.
“With NorMedix we will have a differentiated catheter-technology
platform and additional design and development expertise that will
enhance the value we offer our medical device customers,” said Gary
Maharaj, president and chief executive officer, SurModics. “We remain
focused on being a strategic partner to industry-leading medical device
companies by offering early access to innovative whole-product
solutions.”
NorMedix’s leadership team has a proven track-record of successfully
developing and launching market-leading medical devices. In addition to
developing and licensing its hemostasis sealing device to several
medical device customers, the company has developed advanced braiding
technologies, which allow for the design, development and manufacture of
highly differentiated catheters to support complex interventional
procedures. This proprietary technology is a strong complement to
SurModics’ new hydrophilic coating innovations and future drug-coated
balloon platforms. Together with SurModics’ leadership in coating
technology, the combined organization, with Creagh Medical and NorMedix,
will have the capabilities to support customers from concept to
commercialization. Gregg Sutton, current president and chief executive
officer of NorMedix, will join the SurModics leadership team as vice
president of R&D, reporting to Gary Maharaj.
“We are pleased to be joining the SurModics team, recognizing the
strategic fit of our design and development expertise with SurModics’
innovative coating technologies,” said Sutton. “NorMedix has been
focused on addressing challenging healthcare problems with pioneering
design and development capabilities and is a strong fit with SurModics’
culture, capabilities and commitment to providing innovative healthcare
solutions to help patients.”
SurModics acquired NorMedix for $14 million, including an upfront
payment of $7 million, and up to $7 million based on the achievement of
revenue and other value-creating milestones through September 30, 2019.
Other financial terms of the agreement were not disclosed.
As a result of the NorMedix transaction, SurModics is adjusting fiscal
2016 revenue guidance from a range of $60 million to $64 million to an
adjusted range of $62 million to $66 million. Further, the company is
revising its diluted earnings per share guidance from a range of $0.38
to $0.43 per share to a revised range of $0.30 to $0.35 per share. The
transaction is not expected to impact non-GAAP earnings guidance of
$0.66 to $0.75 per share.
About NorMedix
NorMedix has proven medical device design and development expertise. The
company has a track record with complex, first-of-a-kind precision
devices, especially with early-stage design and development. NorMedix’s
product development process is cost effective and assures quick
turn-around on the highest quality products. The company is based in
Plymouth, Minn.
About SurModics, Inc.
SurModics partners with the world's leading and emerging medical device,
diagnostic and life sciences companies to develop and commercialize
innovative products designed to improve lives by enabling the detection
and treatment of disease. SurModics’ mission is to be a trusted partner
to its customers by providing the most advanced surface modification
technologies and in vitro diagnostic chemical components that help
enhance the well-being of patients. The company’s core offerings include
surface modification coating technologies that impart lubricity,
prohealing and biocompatibility characteristics and components for in
vitro diagnostic test kits and microarrays. SurModics’ strategy is to
build on the product and technical leadership within these fields, and
expand the core offerings to generate opportunities for longer term
sustained growth. SurModics is headquartered in Eden Prairie, Minn. For
more information about the company, visit www.surmodics.com.
The content of SurModics’ website is not part of this press release or
part of any filings that the company makes with the SEC.
Safe Harbor for Forward-Looking Statements
This press release contains forward-looking statements. Statements that
are not historical or current facts, including statements about the
beliefs and expectations regarding the impact of the acquisitions on the
company’s financial performance, and the expected benefits of the
acquisitions, are forward-looking statements. Forward-looking statements
involve inherent risks and uncertainties, and important factors could
cause actual results to differ materially from those anticipated,
including (1) our ability to successfully integrate our acquired
companies, including their employees, products and technology content,
into our business, (2) our ability to successfully develop, obtain
regulatory approval for, and commercialize our proprietary products,
including the products acquired from Creagh Medical and NorMedix,
(3) possible adverse market conditions and possible adverse impacts on
our business operations and financial results, and (4) other factors
identified under “Risk Factors” in Part I, Item 1A of our Annual Report
on Form 10-K for the fiscal year ended September 30, 2015, and updated
in our subsequent reports filed with the SEC. These reports are
available in the Investors section of our website at www.surmodics.com
and at the SEC website at www.sec.gov.
Forward-looking statements speak only as of the date they are made, and
we undertake no obligation to update them in light of new information or
future events.
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