For a reported price of $85 million, Virginia Beach, Virginia-based LifeNet Health has signed a definitive agreement to acquire the wound care division of Durham, North Carolina-based Bioventus Inc. LifeNet had been BioVentus’s supplier of these wound care tissue forms and with this transaction, LifeNet will now also be the marketer and direct supplier to hospitals and clinics.
According to the seller, Bioventus, the sale brings in $85 million of much-needed cash and is expected to close by the last week of May 2023. The terms of the transaction were, according to Bioventus, “$35 million in cash at close, a $5 million cash payment deferred 18 months, and $45 million in potential earn-out payments.” After fees and expenses, the net amount Bioventus expects to receive is approximately $30 million. Importantly, this divestiture of the wound business eases some financial strain on the financially struggling Bioventus.
Bioventus Interim Chief Executive Officer Tony Bihl said, “The sale of our Wound business will enhance our liquidity and enable a greater focus on execution.”
LifeNet Health is a regenerative medicine and life sciences non-profit based in Virginia and had been Bioventus’s supplier of these wound care products, specifically, TheraSkin®, Theragenesis®, and SonicOne®. Through this acquisition, LifeNet not only welcomes approximately 90 former Bioventus employees, but will now be able to capture the full value of these tissue forms, from processing to eventual delivery to hospitals and clinics.
LifeNet Health President and CEO Rony Thomas stated, “The new members of our wound care team are talented professionals, and we know they will be a strong match for our culture, which is devoted to performing at the highest level for each other and for the patients and physicians we serve.”
TheraSkin is a “limb-saving human-to-human allograft.” It is commonly used to treat slow-healing and chronic wounds. According to the LifeNet Health press release, a recent randomized clinical trial shows that “TheraSkin significantly improves wound healing by supporting wound closure at a faster rate than the standard of care.” LifeNet Health is already familiar with TheraSkin. It has been producing TheraSkin since 2010 with Bioventus serving as the distribution channel.
