Volcano Corporation Acquires Crux Biomedical

Volcano Corporation, manufacturer of precision guided therapy tools designed to enhance the diagnosis and treatment of coronary and peripheral vascular disease, has signed an agreement to acquire Crux Biomedical, the Menlo Park, Calif.-based manufacturer of the Crux VCF system—a highly differentiated inferior vena cava (IVC) filter. Designed to facilitate bi-directional retrieval through either the femoral or jugular veins, the system is CE marked and cleared by the U.S. Food and Drug Administration (FDA).

“We are delighted to be adding the novel Crux VCF System, as well as Crux’s other pipeline devices, to our innovative product portfolio,” said Scott Huennekens, president and CEO of Volcano. “Our ability to provide this type of cutting-edge therapy furthers our leadership in the delivery of precision guided therapy and symbolizes our continued evolution from an intravascular imaging company to one that provides a wide variety of diagnostic and therapeutic solutions.”

“We are pleased that Volcano and Crux will be joining forces,” said Randy Lindholm, chairman of Crux. “Volcano has brought state-of-the art intravascular imaging technology to the global market and has clearly made a strong commitment to address the peripheral market. We believe Volcano is the perfect partner for us and is uniquely positioned to generate widespread adoption of the Crux VCF.”

Under terms of the agreement, Volcano will pay $36 million in cash at the close of the sale, which is expected to occur within the next week, subject to a working capital adjustment and customary closing conditions. The San Diego, Calif.-based company also will pay up to approximately $3.1 million in Crux transaction expenses. The merger agreement also provides for a potential post-closing cash milestone payment of $3 million upon FDA clearance of a 510(k) application submitted by Volcano on or before June 30, 2013, for a retrieval device currently being developed by Crux. In addition, Volcano may make additional cash payments for up to four years, based on sales of Crux products following their commercial launch. Volcano expects to initiate commercial sales of Crux products at the end of 2013 once full-scale manufacturing is implemented at its Rancho Cordova, Calif. facility. The company also plans to seek regulatory approval to market the Crux VCF System in combination with its IVUS (intravascular imaging) technology.

Pulmonary embolism (PE), which is caused by a migration of a large blood clot from the deep veins of the legs, affects 600,000 patients in the U.S. every year and results in an estimated 200,000 deaths annually. IVC filters, particularly those that can be retrieved, are an important tool in reducing PE risk for patients for whom anticoagulation is contraindicated or ineffective. The IVC filter market in the United States is estimated at approximately $300 million.

The Crux VCF System received CE marking in December 2011 and 510(k) FDA clearance in July this year. The device has a spiral design, which reportedly allows the system to self-center and allows bi-directional retrieval through either the jugular or femoral vein. In the RETRIEVE 2, 3 and 4 pivotal clinical trials, which enrolled 125 patients at high risk for PE across 22 global sites, the Crux VCF System demonstrated both deployment and retrieval success at 98 percent with zero percent embolization, migration and fracture, Crux claims.

“A key element of our growth strategy is to diversify beyond coronary applications and increase penetration of the peripheral market with our imaging technology,” continued Huennekens. “As we increase our focus on this market, the ability to offer a unique IVC filter and, through further regulatory approvals, use IVUS to facilitate its placement at the bedside, represents compelling clinical and economic value for patients, clinicians and the healthcare system.”

“The Crux VCF represents the first major design innovation for IVC filters in nearly four decades and incorporates important product attributes that provide improved patient outcomes,” said Thomas Fogarty, M.D., founder of Crux. “This transaction pairs two companies that have led innovation and I believe the future addition of IVUS guidance to the Crux technology will represent a seminal change in the practice of vascular medicine.”