Sector: Medical Device, HME, Urology
WAYNE, Pa. Teleflex will buy NeoTract for $1.1 billion in a move that significantly expands its urological product offerings, the company announced Sept. 5.
NeoTract, maker of the UroLift System, had revenues of about $51 million in 2016 compared to about $18 million in 2015, representing 178% year-over-year growth. For 2017, NeoTract expects revenues to be between $115 million and $120 million, and for 2018, it expects them to grow at least 40%.
This combination is expected to solidify Teleflex™s ability to generate mid-single digit constant currency revenue growth for the next several years, as well as enhance Teleflex™s margin profile,â€ said Benson Smith, chairman and CEO of Teleflex. NeoTract is a truly unique company with a differentiated technology that targets a greater than $30 billion addressable market, and through their internally developed, patented UroLift System, have achieved sequential quarterly revenue growth of 20% or greater in 13 of the past 14 quarters. Importantly, while we believe NeoTract has compelling growth opportunities as they continue to penetrate the market.
Founded in 2004, NeoTract is a privately held medical device company that has developed and commercialized the FDA-cleared UroLift System, a minimally invasive technology for treating lower urinary tract symptoms due to benign prostatic hyperplasia or BPH.
Under the terms of the agreement, Teleflex will acquire NeoTract for an upfront cash payment of $725 million at closing, and up to an additional $375 million upon the achievement of certain commercial milestones related to sales through the end of 2020. The boards of directors of both Teleflex and NeoTract have unanimously approved the transaction.