Biocompatible Sells Troubled Business Unit to German Company

Biocompatibles Inc., an Oxford, Conn.-based provider of interventional medicine, is divesting its troubled prostate cancer implant business unit to Germany-based Eckert & Ziegler AG. Biocompatibles voluntarily suspended operations in May after the U.S. Food and Drug Administration (FDA) noted problems with its manufacturing processes, data collection, monitoring of the production environment and handling of complaints.

In an April 30 letter posted on the FDA’s website, a New England district regulator wrote to Biocompatibles that the FDA had found problems with the company’s manufacturing process for its radioactive brachytherapy needle sets, which include prostate needles pre-filled with coated radioactive seeds.

“The acquisition is a strategic investment decision and represents another milestone in our company’s history despite the one-time expenses for entering the U.S. implant business,” said Dr. Edgar Löffler, managing director of Eckert & Ziegler. “The North American market is the largest single market for medical technology and offers excellent growth opportunities. The implants market is valued at some €45 million [or $60 million U.S.] and the market for tumor radiation equipment at around €70 million [or $93 million U.S.]. The acquisition offers us potential for synergies in markets, products and technologies that will strengthen our market position. Thanks to our long-standing experience in isotope technology, we are confident that we will be able to introduce FDA-compliant manufacturing processes at the Oxford site quickly and recommence production again soon.”

Eckert officials also said in a statement that the company hopes to remedy the Biocompatiobles business unit’s shortcomings quickly so it can resume delivery.

The company hopes to win back previous customers lost as a result of the shutdown. In the meantime, it expects to incur unforeseen additional costs of $1.6 million until the implant business can be resumed.

Biocompatibles had 2012 sales of approximately $10.7 million, according to Eckert officials.