Volcano, a provider of intravascular ultrasound (IVUS), functional measurement and optical coherence tomography products, has acquired Novelis, a privately held company with proprietary ultrasonic visualization and therapy technology for minimally invasive diagnostic and therapeutic devices.
Under the terms of the agreement, Volcano said it paid approximately $12 million in cash at closing. In addition, the San Diego-based company may make an additional cash payment of $3 million based on the achievement of a specific regulatory milestone.
Novelis’ proprietary Forward-Looking IVUS (FLIVUS) technology platform is expected to build upon Volcano’s existing suite of products, the company said. Volcano said it expects to add the products and capability of the Methuen, Mass.-based Novelis onto its s5i multi-modality integrated platform and hub.
Volcano said Novelis’ FLIVUS technology includes an image-guided crossing catheter that combines visualization, steerability and RF tissue ablation, designed to permit interventional cardiologists to cross chronic total occlusions (CTO) in the coronary and peripheral arteries. A FLIVUS catheter facilitates current guidewire-based CTO crossing techniques, as well as other potential product offerings with possible applications outside of vascular medicine, the company said.
“It is estimated there are currently over 200,000 CTOs performed in the United States, Europe and Japan each year. These procedures, which remain one of the most challenging issues faced by interventionalists today, often fail or take hours to successfully complete due to inadequate visualization,” said Scott Huennekens, president and CEO of Volcano.
“CTOs have highly invasive and costly coronary artery bypass grafting (CABG) procedures. The products under development by Novelis have the potential to shorten procedure times and minimize complications plus dramatically add to the total number of procedures being performed – enabling patients with CTOs to be treated in the cath lab rather than in the surgery suite,” he added.
“We are also very excited to explore the potential for this technology platform in other large expanding markets like ablations for atrial fibrillation and spine therapy,” Huennekens concluded.
Novelis’ platform consists of a forward-looking, manually-steered imaging system comprised of a laptop-sized console with advanced custom software and single-use catheters both with and without RF ablation, according to Volcano. The system and accessories are not approved for human use and have not been submitted to the FDA for regulatory clearance.
Volcano expects to file for appropriate U.S. and international approvals on the first of several devices during 2009, and begin commercialization of a stand-alone imaging console in the second half of 2009 in the United States and Europe. The company also noted that it expects the majority of the purchase price to be written off immediately as in process research and development and to incur ongoing development costs in the range of $300,000 to $400,000 per quarter.