25 February 2008 - MDY Healthcare plc (“MDY Healthcare”) announces today that it has co-led, with Abingworth Management (“Abingworth”), a syndicate of investors to acquire the entire issued share capital of Stanmore Implants Worldwide Ltd (”Stanmore” or the “Company”), an orthopaedic company focused on saving and restoring the function of limbs and joints.
The investor syndicate is working closely with Brian Steer who will lead Stanmore as Executive Chairman. Brian is a medical technology industry veteran and was most recently Chairman of Gyrus Group plc, which was acquired for £935 million by Olympus UK Acquisitions Limited in late 2007. Stanmore’s senior management team, as well as its clinical and scientific collaborators, have agreed to remain with the Company.
Stanmore Implants Worldwide
Stanmore was formed in 1949 and is an innovative orthopaedic business focused on saving and restoring the function of limbs and joints. The Company designs, manufactures and markets a custom implant service with a portfolio of orthopaedic implants for limb salvage and complex joint replacement. Stanmore is now a market leader in the UK and has a rapidly expanding presence in export markets, delivered through both direct and distributor sales.
Stanmore is headquartered in a specialised facility at the world-renowned Royal National Orthopaedic Hospital in Stanmore, Middlesex, and has a small Continental European sales office in Lyon, France. The Company is currently owned by University College London, and was spun out as an independent company from UCL’s Centre for Biomedical Engineering in 1996. The Centre is known for its design of some of the world’s most successful implants including the Stanmore Hip.
Stanmore focuses on high value, technically demanding applications where it differentiates itself by forming long-term relationships with specialist surgeons, delivering advanced designs, high-quality products and rapid service. The Company has annual sales in excess of £4 million and has been profitable for several years.
Intraosseous Transcutaneous Amputation Prosthesis (ITAP)
Stanmore’s key new product development is ITAP, an innovative device for directly attaching prosthetic devices to the skeleton of amputees. It is being developed for a wide-range of applications including upper and lower limb, digits and craniofacial prostheses. ITAP builds on ground-breaking research undertaken by UCL with a design that, by mimicking successful skin-penetrating natural structures (such as deer antler) stably integrates with the skin. This provides an effective barrier against infection, which has to date limited the application of percutaneous implants to dental implants and craniofacial applications.
Surgeons working closely with the company have implanted a number of craniofacial ITAP devices over the last three years with encouraging clinical results. Similarly, over the last two years, digit ITAP devices have been implanted in a number of patients with positive results. In late 2007, the first upper limb ITAP device was implanted in a 7/7 bomb victim. The patient is progressing well, and Stanmore plans to implant further upper and the first lower limb ITAP implants during this year.
The investment syndicate will invest a total of £12.5 million to acquire the Company and provide funds for future growth of both the core business and the clinical development of ITAP, its key new product development. The syndicate is co-led by MDY Healthcare and Abingworth and also includes Ivy Capital Partners, LLC (“Ivy Capital”). Abingworth is an investment firm dedicated to the life sciences sector investing across all stages of development from early-stage through to public companies. Ivy Capital is a US private equity firm specialised in investing in companies operating in the musculoskeletal sector of the healthcare industry.
MDY Healthcare has invested £3 million in the transaction and will have approximately 20% of the issued share capital on a fully-diluted basis. Charles Spicer, CEO of MDY Healthcare and Tim Haines a Partner at Abingworth, who will be investing £8.5m, have been appointed to the board of SIW.
Brian Steer, Executive Chairman of Stanmore Implants Worldwide, said:
“In my many years in the industry, I have seen few products as innovative as the ITAP implant. The ability to attach prosthetic devices directly to the skeleton of amputees is truly ground-breaking and has already benefitted patients. I look forward to working with the team at Stanmore to roll out the existing business internationally while completing the clinical development and commercial launch of ITAP.”
Cengiz Tarhan, Managing Director of UCL Business, added:
“Stanmore is a great example of academia and technology transfer working together within an academic and NHS environment delivering benefits to society. The sale of SIW to MDY and Abingworth will accelerate the development of ITAP which will benefit both patients and the continuing academic research at UCL”.
Charles Spicer, CEO of MDY Healthcare, added:
“Stanmore is a key strategic investment for MDY and illustrates the evolution of our business model. We are backing one of our senior advisers and working alongside a specialised investor group to acquire a profitable company that has been an international centre of excellence in its field for nearly 60 years. With its world class range of marketed products and development projects, SIW has significant growth potential which should therefore generate a healthy return for MDY shareholders.”
For further information, please contact:
MDY Healthcare plc
Charles Spicer, CEO
+44 (0) 207 647 1800
Ben Atwell, Susan Quigley
+44 (0) 207 831 3113
Brewin Dolphin Limited (Nomad)
+44 (0) 845 270 8600
Notes for editors:
About MDY Healthcare
MDY Healthcare plc is a sector specialised strategic investing company quoted on AIM (ticker symbol: MDY). MDY Healthcare seeks to achieve superior returns for shareholders by investing globally in companies, both public and private, across the healthcare sector. The directors, executives and senior advisors have significant operational and investment experience in the sector and therefore the ability to identify and review a wide range of potential investments.
Further information can be found on the website www.mdyhealthcare.com
MDY Healthcare plc intends to publish its annual report and accounts for the year ended 30 September 2007 by March 2008. When available, shareholders will be able to download the report and accounts from the website www.mdyhealthcare.com.