BURLINGTON, Mass., Oct. 1, 2012 (GLOBE NEWSWIRE) -- LeMaitre Vascular, Inc. (Nasdaq:LMAT), a provider of peripheral vascular devices and implants, announced today that it has signed an agreement to acquire the manufacturing and distribution rights to XenoSure® from Neovasc, Inc. on October 31, 2012 for $4.6mm, subject to standard closing conditions. XenoSure is a bovine pericardium patch used primarily for carotid and vascular reconstructions. As part of the transaction, the two parties have also signed a back-up supply agreement to assure product availability during the manufacturing transfer. LeMaitre Vascular (the "Company") recorded XenoSure revenues of $4.5mm in the twelve months ending September 30, 2012 vs. $2.8mm in the prior 12-month period, a 61% increase.
In January 2009 the Company became the exclusive U.S. vascular distributor of XenoSure, inheriting sales of approximately $600,000 per year. Since then, the Company has secured exclusive worldwide distribution rights and is now selling the implant through its direct sales force in the US, Europe and Canada. The original distribution agreement was to have expired in January 2016, while the exclusive acquisition option period was to have begun in January 2014. LeMaitre Vascular owns the XenoSure trademark.
Neovasc retains the right to process and distribute bovine pericardium for all other applications that do not compete directly with the Xenosure vascular surgical patch business.
"We look forward to acquiring this high-growth product 14 months ahead of schedule, allowing us to secure manufacturing and distribution rights. Following the manufacturing transfer, we expect our XenoSure gross margin will improve from approximately 50% to 65%. In addition, this option exercise will enable us to extend and enhance the product line," said David B. Roberts, President of LeMaitre Vascular.
During the manufacturing transfer, the Company expects $300,000 of incremental expenses in Q4 2012 and $600,000 in 2013. Beginning in 2014, the transaction is expected to be accretive to operating income by approximately $1.0mm a year, growing at the same rate as XenoSure's sales.
About LeMaitre Vascular
LeMaitre Vascular is a provider of devices for the treatment of peripheral vascular disease, a condition that affects more than 20 million people worldwide. The Company develops, manufactures and markets disposable and implantable vascular devices to address the needs of its core customer, the vascular surgeon.
LeMaitre, XenoSure and the LeMaitre Vascular logo are registered trademarks of LeMaitre Vascular, Inc.
For more information about the Company, please visit http://www.lemaitre.com.
The LeMaitre Vascular, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=10015
This press release contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Statements in this press release regarding the Company's business that are not historical facts may be "forward-looking statements" that involve risks and uncertainties. Specifically, statements regarding the Company's expectations regarding XenoSure's gross margin and operating income contributions and associated expenses, development plan and timing for additional XenoSure products and sufficiency of the Company's supply of XenoSure are forward-looking, involving risks and uncertainties. Forward-looking statements are based on management's current, preliminary expectations and are subject to risks and uncertainties that could cause actual results to differ from the results predicted. These risks and uncertainties include, but are not limited to, the risk that the XenoSure product is not as accretive as anticipated; the risk that the Company experiences production delays or quality difficulties in the transition of the XenoSure manufacturing operations; and other risks and uncertainties included under the heading "Risk Factors" in our most recent Annual Report on Form 10-K, as updated by our subsequent filings with the SEC, all of which are available on the Company's investor relations website at http://www.lemaitre.com and on the SEC's website at http://www.sec.gov. Undue reliance should not be placed on forward-looking statements, which speak only as of the date they are made. The Company undertakes no obligation to update publicly any forward-looking statements to reflect new information, events, or circumstances after the date they were made, or to reflect the occurrence of unanticipated events.
Source:LeMaitre Vascular, Inc.