REG - Smith & Nephew Plc - S+N acquires novel cementless partial knee system

Smith & NephewAnnouncement

19/01/2022 07:05

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RNS Number : 8800Y  Smith & Nephew Plc  19 January 2022

Smith+Nephew acquires novel cementless partial knee system
19 January 2022

Smith+Nephew (LSE:SN, NYSE:SNN), the global medical technology business,
announces the acquisition of Engage Surgical, owner of the only cementless
unicompartmental (partial) knee system commercially available in the US.

This acquisition strongly supports Smith+Nephew's strategy for growth by
transforming its business through innovation and acquisition, while also
providing differentiation for its customers. The Engage Surgical Partial Knee
System is a novel, modern cementless knee implant to serve a resurgent segment
driven by the potential for better long-term fixation through biologic
integration, shorter operating times, and the shift to Ambulatory Surgery
Centers (ASCs).

Randy Kilburn, Executive Vice President & General Manager, Reconstruction,
Robotics and Digital, said:

"Smith+Nephew is now the only medical device company offering both cemented
and cementless partial knee implants in the US, as well as robotics-assistance
through the CORI(◊) Surgical System that is well-suited for the precise
alignment needed. Through our Sports Medicine franchise we have an
established, strong position in ASCs where the vast majority of partial knees
in the US are performed. Our VISIONAIRE(◊) business, the high performance
and small footprint of CORI, plus our partial knee portfolio, is a unique
compelling offering for customers."

The acquisition will drive Smith+Nephew's Robotics and Real Intelligence
strategy. Partial knee procedures are well-matched for robotics due to the
need for precise alignment and Smith+Nephew's CORI Surgical System already
supports the cemented JOURNEY II(◊) unicompartmental knee. The Engage
Surgical Partial Knee System is optimised for robotics and will have an
application with CORI in the future. Engage Surgical's Partial Knee System
also complements Smith+Nephew's focus on serving the growing outpatient
market, with an increasing proportion of knee procedures performed in ASCs.

Dan Justin, Chief Executive Officer, Engage Surgical, said:

"The Engage Surgical Team is excited about joining Smith+Nephew to help expand
the impact of the Engage Surgical Partial Knee System and integrating it with
the CORI Surgical System. Smith+Nephew is well-suited and well-prepared to
continue our mission of providing better outcomes for knee arthroplasty
patients."

With Engage Surgical's Partial Knee System, Smith+Nephew expects to be able to
drive market expansion in the US, and in time in other markets as regulatory
approvals are secured. Engage Surgical's Partial Knee System currently has
regulatory clearance in the US where it is in limited market release.

The partial knee market is currently worth approximately $300 million in the
US (SmartTRAK) and is expected to grow faster than the total knee market and
by around 4% per annum through 2029 (Millennium Research Group, Inc).
Smith+Nephew expects cementless partial knees will grow ahead of overall
partial knees, in line with recent patterns seen in the cementless segment.

The cost of the acquisition is up to $135 million contingent on sales
performance. The acquisition was financed from existing cash and debt
facilities. Engage Surgical is located in Orlando, Florida.

 

Enquiries

 

 Investors
 Andrew Swift                       +44 (0) 1923 477433
 Smith+Nephew

 Media
 Charles Reynolds                   +44 (0) 1923 477314
 Smith+Nephew

 Susan Gilchrist / Ayesha Bharmal   +44 (0) 20 7404 5959
 Brunswick

 

About Smith+Nephew

 

Smith+Nephew is a portfolio medical technology business focused on the repair,
regeneration and replacement of soft and hard tissue. We exist to restore
people's bodies and their self-belief by using technology to take the limits
off living. We call this purpose 'Life Unlimited'. Our 18,000 employees
deliver this mission every day, making a difference to patients' lives through
the excellence of our product portfolio, and the invention and application of
new technologies across our three global franchises of Orthopaedics, Advanced
Wound Management and Sports Medicine & ENT.

Founded in Hull, UK, in 1856, we now operate in more than 100 countries, and
generated annual sales of $4.6 billion in 2020. Smith+Nephew is a constituent
of the FTSE100 (LSE:SN, NYSE:SNN). The terms 'Group' and 'Smith+Nephew' are
used to refer to Smith & Nephew plc and its consolidated subsidiaries,
unless the context requires otherwise.

 

For more information about Smith+Nephew, please visit www.smith-nephew.com
(http://www.smith-nephew.com/) and follow us on Twitter
(http://www.twitter.com/smithnephewplc) , LinkedIn
(http://www.linkedin.com/company/smith-%26-nephew) , Instagram
(https://www.instagram.com/smithnephewmeded/) or Facebook
(http://www.facebook.com/smithnephewplc) .

 

Forward-looking Statements

 

This document may contain forward-looking statements that may or may not prove
accurate. For example, statements regarding expected revenue growth and
trading margins, market trends and our product pipeline are forward-looking
statements. Phrases such as "aim", "plan", "intend", "anticipate",
"well-placed", "believe", "estimate", "expect", "target", "consider" and
similar expressions are generally intended to identify forward-looking
statements. Forward-looking statements involve known and unknown risks,
uncertainties and other important factors that could cause actual results to
differ materially from what is expressed or implied by the statements. For
Smith+Nephew, these factors include: risks related to the impact of COVID,
such as the depth and longevity of its impact, government actions and other
restrictive measures taken in response, material delays and cancellations of
elective procedures, reduced procedure capacity at medical facilities,
restricted access for sales representatives to medical facilities, or our
ability to execute business continuity plans as a result of COVID; economic
and financial conditions in the markets we serve, especially those affecting
health care providers, payers and customers (including, without limitation, as
a result of COVID); price levels for established and innovative medical
devices; developments in medical technology; regulatory approvals,
reimbursement decisions or other government actions; product defects or
recalls or other problems with quality management systems or failure to comply
with related regulations; litigation relating to patent or other claims; legal
compliance risks and related investigative, remedial or enforcement actions;
disruption to our supply chain or operations or those of our suppliers
(including, without limitation, as a result of COVID); competition for
qualified personnel; strategic actions, including acquisitions and
dispositions, our success in performing due diligence, valuing and integrating
acquired businesses; disruption that may result from transactions or other
changes we make in our business plans or organisation to adapt to market
developments; and numerous other matters that affect us or our markets,
including those of a political, economic, business, competitive or
reputational nature. Please refer to the documents that Smith+Nephew has filed
with the U.S. Securities and Exchange Commission under the U.S. Securities
Exchange Act of 1934, as amended, including Smith+Nephew's most recent annual
report on Form 20-F, for a discussion of certain of these factors. Any
forward-looking statement is based on information available to Smith+Nephew as
of the date of the statement. All written or oral forward-looking statements
attributable to Smith+Nephew are qualified by this caution. Smith+Nephew does
not undertake any obligation to update or revise any forward-looking statement
to reflect any change in circumstances or in Smith+Nephew's expectations

 

(.)( ◊ )Trademark of Smith+Nephew. Certain marks registered US Patent and
Trademark Office.

 

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