a2009usmithnephewplcedgar
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 6-K
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16 under the
Securities Exchange Act of 1934
November
22, 2023
Commission
File Number 001-14978
SMITH & NEPHEW plc
(Registrant’s
name)
Building 5, Croxley Park, Hatters Lane
Watford, England, WD18 8YE
(Address
of principal executive office)
Indicate
by check mark whether the registrant files or will file annual
reports under cover of Form 20-F or Form 40-F.
Form
20-F ✓
Form 40-F __
Smith+Nephew acquires novel cartilage regeneration technology for
sports medicine knee repair
22 November 2023
Smith+Nephew (LSE:SN, NYSE:SNN), the global medical technology
company, today announces that it has entered into a definitive
agreement to acquire CartiHeal, developer of Agili-C, a novel
sports medicine technology for cartilage regeneration in the
knee. Under
the terms of the agreement, Smith+Nephew will
pay an
initial cash consideration of $180 million at closing, and up to a
further $150 million contingent on financial
performance.
Agili-C is an off-the-shelf one-step treatment for osteochondral
(bone and cartilage) lesions with a broader indication than
existing treatments. It is indicated to
treat a wide patient population, including those with lesions in
knees with mild to moderate osteoarthritis,
a previously unaddressed condition, as well as the approximately
700,000 patients1 that
receive cartilage repair annually in the US.
"The acquisition of this disruptive technology supports our
strategy to invest behind our successful Sports Medicine business",
said Deepak Nath, Chief Executive Officer of Smith+Nephew.
"Agili-C's superior clinical performance makes it highly
complementary to our existing knee repair portfolio and with our
proven commercial expertise in high-growth biologics, we are
confident that we will drive further success with this compelling
treatment option."
Agili-C is a porous, biocompatible, and resorbable scaffold which
promotes natural regeneration of the articular cartilage and
restoration of its underlying subchondral bone. The U.S. Food and
Drug Administration (FDA) granted Agili-C Breakthrough Device
designation status in 2020 and Premarket Approval (PMA) in March
2022. PMA approval was granted based on the results of a two-year
randomised controlled trial (N=251) that confirmed superiority of
Agili-C over current standard of care - microfracture and
debridement for the treatment of knee joint surface lesions,
chondral and osteochondral defects. Study inclusion criteria
included patients with mild and moderate osteoarthritis. At
four-year follow-up the
trial continues to show significant improvement of patient reported
outcome scores, low surgical reintervention, and
that the difference in improvement using Agili-C compared to the
standard of care is statistically significant - offering potential
for a new standard of care in cartilage repair.
"As a leader in sports medicine and with a deep knowledge of
biologics, Smith+Nephew is the ideal new home for Agili-C," said
Nir Altschuler, Chief Executive Officer and Founder of CartiHeal.
"We are excited at the prospect of our technology helping many more
patients overcome knee pain."
"We have shown with REGENETEN◊ that
we have the market development and commercialisation expertise to
take novel technologies and successfully establish a new standard
of care," said Scott Schaffner, President Sports Medicine,
Smith+Nephew. "Agili-C is the perfect addition to our
portfolio and we look forward to leveraging our expertise to
transform cartilage repair outcomes for
patients."
CartiHeal was founded in 2009 as a university spin-out. It retains
a small facility close to Tel Aviv and a sales office in New
Jersey, US. CartiHeal has large quantities of raw material in the
US and, by close of the transaction, will also have ample US stock
to support full commercial launch. All CartiHeal employees are
expected to transfer to Smith+Nephew.
The transaction is expected to close in the first quarter of 2024.
Breakeven to trading profit is targeted by 2027 with ROIC to exceed
our WACC by the fifth year. The acquisition will be financed from
existing cash and debt facilities.
Smith+Nephew's Meet
the Management investor
event on 29 November 2023 will include discussion of this
acquisition.
Enquiries
Investors / Analysts
Andrew Swift
Smith+Nephew
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+44 (0) 1923 477433
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Media
Charles Reynolds
Smith+Nephew
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+44 (0) 1923 477314
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Susan Gilchrist / Ayesha Bharmal
Brunswick
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+44 (0) 20 7404 5959
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References
1.
Medtech 360, Sports Medicine Devices, Market Analysis, US, 2018,
Millennium Research Group, Inc.
About Smith+Nephew
Smith+Nephew is a portfolio medical technology business that exists
to restore people's bodies and their self-belief by using
technology to take the limits off living. We call this purpose
'Life Unlimited'. Our 19,000 employees deliver this mission every
day, making a difference to patients' lives through the excellence
of our product portfolio, and the invention and application of new
technologies across our three global business units of
Orthopaedics, Advanced Wound Management and Sports Medicine &
ENT.
Founded in Hull, UK, in 1856, we now operate in more than 100
countries, and generated annual sales of $5.2 billion in 2022.
Smith+Nephew is a constituent of the FTSE100 (LSE:SN, NYSE:SNN).
The terms 'Group' and 'Smith+Nephew' are used to refer to Smith
& Nephew plc and its consolidated subsidiaries, unless the
context requires otherwise.
For more information about Smith+Nephew, please
visit www.smith-nephew.com and
follow us on X, LinkedIn, Instagram or Facebook.
Forward-looking Statements
This document may contain forward-looking statements that may or
may not prove accurate. For example, statements regarding expected
revenue growth and trading profit margins, market trends and our
product pipeline are forward-looking statements. Phrases such as
"aim", "plan", "intend", "anticipate", "well-placed", "believe",
"estimate", "expect", "target", "consider" and similar expressions
are generally intended to identify forward-looking statements.
Forward-looking statements involve known and unknown risks,
uncertainties and other important factors that could cause actual
results to differ materially from what is expressed or implied by
the statements. For Smith+Nephew, these factors include: risks
related to the impact of Covid, such as the depth and longevity of
its impact, government actions and other restrictive measures taken
in response, material delays and cancellations of elective
procedures, reduced procedure capacity at medical facilities,
restricted access for sales representatives to medical facilities,
or our ability to execute business continuity plans as a result of
Covid; economic and financial conditions in the markets we serve,
especially those affecting healthcare providers, payers and
customers (including, without limitation, as a result of Covid);
price levels for established and innovative medical devices;
developments in medical technology; regulatory approvals,
reimbursement decisions or other government actions; product
defects or recalls or other problems with quality management
systems or failure to comply with related regulations; litigation
relating to patent or other claims; legal and financial compliance
risks and related investigative, remedial or enforcement actions;
disruption to our supply chain or operations or those of our
suppliers (including, without limitation, as a result of Covid);
competition for qualified personnel; strategic actions, including
acquisitions and disposals, our success in performing due
diligence, valuing and integrating acquired businesses; disruption
that may result from transactions or other changes we make in our
business plans or organisation to adapt to market developments;
relationships with healthcare professionals; reliance on
information technology and cybersecurity; disruptions due to
natural disasters, weather and climate change related events;
changes in customer and other stakeholder sustainability
expectations; changes in taxation regulations; effects of foreign
exchange volatility; and numerous other matters that affect us or
our markets, including those of a political, economic, business,
competitive or reputational nature. Please refer to the documents
that Smith+Nephew has filed with the U.S. Securities and Exchange
Commission under the U.S. Securities Exchange Act of 1934, as
amended, including Smith+Nephew's most recent annual report on Form
20-F, which is available on the SEC's website at www. sec.gov, for
a discussion of certain of these factors. Any forward-looking
statement is based on information available to Smith+Nephew as of
the date of the statement. All written or oral forward-looking
statements attributable to Smith+Nephew are qualified by this
caution. Smith+Nephew does not undertake any obligation to update
or revise any forward-looking statement to reflect any change in
circumstances or in Smith+Nephew's expectations.
◊ Trademark
of Smith+Nephew. Certain marks registered in US Patent and
Trademark Office.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.
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Smith & Nephew plc
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(Registrant)
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Date:
November 22, 2023
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By:
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/s/
Helen Barraclough
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Helen
Barraclough
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Company
Secretary
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