ABBOTT LABORATORIES TO ACQUIRE SPINAL CONCEPTS
Targeted Acquisition Enhances Company's High-Acuity Strategy in The Hospital Market
ABBOTT PARK, Ill., and AUSTIN, Texas, June 2 /PRNewswire-FirstCall/ -- Abbott Laboratories (NYSE: ABT - News) and Spinal Concepts, Inc. today announced that the companies have entered into an agreement for Abbott to acquire the medical device company. Spinal Concepts currently markets a broad range of devices, including spinal fixation products used in the treatment of spinal disorders, diseases and injuries.
Under the terms of the agreement, Abbott will acquire all of the stock of Spinal Concepts, a privately held company, for approximately $170 million in cash plus additional milestone payments of up to $40 million if agreed upon targets are met. This transaction will not have an impact on the results of Abbott's 2003 ongoing operations, but will result in a one-time charge primarily for in-process research and development. The transaction is subject to regulatory approvals and customary closing conditions and is expected to be completed in the second quarter of 2003.
"Spinal Concepts' existing and pipeline products provide us with access to another high acuity patient area and support our strategies of meeting unmet clinical needs and providing products that result in improved clinical outcomes and shortened length of hospital stay," said Christopher B. Begley, senior vice president, hospital products, Abbott Laboratories.
The Spinal Concepts acquisition adds to Abbott's existing leadership platform in medical devices. Abbott's Hospital Products Division has marketed traditional medical devices for more than 60 years, and has recently expanded its presence in high-growth medical product areas such as cardiovascular devices. Orthopedics is the second largest medical device area behind cardiovascular devices, and the spinal market is the fastest growing segment of orthopedic implant products.
Spinal Concepts is an innovative company that offers a wide range of medical devices, such as spinal fixation products, most of which are used during spinal fusion surgical procedures. This year an estimated 350,000 to 400,000 fusion procedures will be performed in the United States with more than 60 percent of those procedures utilizing either fixation systems, interbody devices or a combination of both. Spinal Concepts currently markets a broad range of products for all segments of the spine, including two pedicle screw options for thoracolumbar fixation -- BacFix® and InCompass®; the SC-AcuFix(TM) family of cervical plates; and osteobiologic products including Cerasorb(TM) bone void filler and the Natural Selection® family of bone allografts.
The use of minimally invasive devices and techniques in spinal surgery is an important emerging trend that can improve outcomes, decrease patient discomfort and shorten the length of a hospital stay following the procedure. To address this market, Spinal Concepts recently introduced PathFinder(TM), a unique, minimally invasive pedicle screw system that is more user-friendly and less invasive.
"Our mission to provide innovative products in emerging market segments has helped make Spinal Concepts the fastest growing spinal fixation company in the market," said Jeff Binder, president and CEO, Spinal Concepts. "The addition of Abbott's resources and expertise can only further strengthen and accelerate our introduction of important new technologies. This transaction is an exciting event for the company and its employees, and also for our customers and their patients, our sales force, and our supplier partners."
About Abbott Laboratories
Abbott Laboratories is a global, broad-based health care company devoted to the discovery, development, manufacture and marketing of pharmaceuticals, nutritionals, and medical products, including devices and diagnostics. The company employs approximately 70,000 people and markets its products in more than 130 countries. In 2002, the company's sales and net earnings were $17.7 billion and $3.2 billion, respectively, with diluted earnings per share of $2.06, excluding one-time charges.
Abbott's news releases and other information are available on the company's Web site at http://www.abbott.com .
About Spinal Concepts, Inc.
Spinal Concepts is a privately held medical device company dedicated to providing the surgical community with safe, technologically-advanced spinal implant products used in the treatment of spinal disorders, diseases and injuries. The company's broad array of spinal implants includes the most technologically advanced devices for the cervical, thoracic and lumbar segments of the spine. For more information, visit the company's website at http://www.spinalconcepts.com .