AtriCure has entered into a definitive agreement to acquire SentreHEART, which developed the LARIAT device for left atrial appendage closure in patients with atrial fibrillation. A press release reports that the transaction consideration consists of an upfront payment of approximately US$40 million in cash and AtriCure common stock, plus additional contingent consideration based on the achievement of certain clinical and reimbursement milestones
Of the contingent consideration, the press release adds, $140 million is based on milestones related to the aMAZE IDE clinical trial—including premarket approval (PMA)—and $120 million is based on a milestone related to reimbursement for the therapy involving SentreHEART devices. All contingent consideration would be payable in a combination of cash and stock.
The aMAZE trial (ClinicalTrials.gov Identifier: NCT02513797) is an ongoing, randomised controlled trial that is evaluating the safety and effectiveness of the LARIAT system to percutaneously isolate and ligate the left atrial appendage from the left atrium as an adjunct to planned pulmonary vein isolation catheter ablation (vs. catheter ablation alone) for the management of patients with persistent or long-standing atrial fibrillation. It is expected to enrol up to 600 patients at 65 sites with one-year follow up, and the primary endpoint measures are freedom from episodes of atrial fibrillation greater than 30 seconds at one-year post treatment.
According to the SentreHEART website, the non-invasive LARIAT procedure “closes the left atrial appendage by remotely delivering a pre-tied suture loop precisely to the base of the left atrial appendage for immediate and complete closure”. The website notes that “unlike other devices”, the LARIAT device does not leave anything behind in the inside of the heart, stating “within a few months after closure with the LARIAT, the left atrial appendage will disappear and never again be a source of blood clots”.
Michael Carrel, president and CEO of AtriCure, comments: “We believe that SentreHEART is a strategic addition to AtriCure, significantly expanding our addressable markets with a product designed for electrophysiologists. With our pursuit of labelling based on the aMAZE Trial, we are deepening our commitment to provide the broadest possible offering of ablation and left atrial appendage management solutions to our customers and their patients.” He adds: “We believe that upon FDA approval, use of the LARIAT device will continue to advance AtriCure’s competitive position in the market.”
AtriCure already has a portfolio of electrophysiology products, including the Isolator Synergy ablation system—the only US Food and Drug Administration (FDA) approved device for the management of persistent atrial fibrillation. It also has the AtriClip left atrial appendage Exclusion System range of products, which the press release reports “are the most widely sold left atrial appendage devices worldwide”.
AtriCure projects total revenue for 2019 to be in the range of $224.5 million to $228.5 million, which includes minimal contribution from SentreHEART, and reflects approximately 11% to 13% organic growth. Furthermore, revenue contribution from the SentreHEART business is expected to be nominal until after completion of the aMAZE trial and PMA approval.
Andy Wade, senior vice president and chief financial officer, comments: “We have a strong balance sheet, which has been reinforced by our credit facility with Silicon Valley Bank. As a result, we believe that we can support both the upfront payment and ongoing investments in the combined business with minimal shareholder dilution. While this transaction will impact short and medium-term profitability, we do not need to raise additional capital to finish the aMAZE Trial or support post-trial commercialisation efforts.”
Use of left atrial appendage closure devices in top five EU markets
Data from the BIBA MedTech LAA monitor indicates that during Q2 (1 April–30 June) of this year, 3,743 left atrial appendage devices were implanted in top five EU markets (France, Germany, Italy, Spain, and UK). Nearly half of these (47.9%) of these were with Abbott’s Amplatzer Amulet device and another 42.8% were with Boston Scientific’s Watchman/Watchman Flex. Only 4.8% of implants were with the LARIAT system. The monitor does not provide any details on how many Atricure devices were implanted, but they may have been included as part of “others” (1.7%). See Figure 1.
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