Neovasc Inc (NASDAQ:NVCN) shares were up 70.42% on Tuesday to $2.42 and an additional 4.96% in after-hours trading to $2.54. The company has a market cap of $94.95 million at 66.87 million shares outstanding. Share prices have been trading in a 52-week range of $0.37 to $4.94.
In a recent press release, Neovasc Inc announced that Boston Scientific Corporation has agreed to acquire Neovasc’s tissue processing technology and facility for approximately US$67,909,800. It has also committed to invest an additional US$7,090,200 in Neovasc Inc for a 15% equity interest in the company.
Boston Scientific Corporation is a global medical technology leader and a worldwide developer, manufacturer and marketer of medical devices whose products are used in a range of medical specialties, including interventional radiology, interventional cardiology, vascular surgery, endoscopy, oncology, urology and gynecology.
“Boston Scientific has been a long-term customer of Neovasc, having historically represented a sizeable percentage of our tissue processing revenues,” commented Neovasc CEO Alexei Marko . “As one of the world’s premier device companies, with a global cardio-vascular franchise, this investment in Neovasc enables continued development of our lead products, Reducer and Tiara, and strengthens our resolve to revolutionize how structural heart disease is treated.”
Under the terms of the agreement, Neovasc Inc has been granted a license to the purchased assets and access to the sold facilities to allow it to continue its tissue and valve assembly activities for its remaining customers. The company is also allowed continue its own tissue-related programs, including advancing its mitral bioprosthesis valve Tiara through its clinical and regulatory pathways. The transaction is expected to close by the end of the year.
Note, however, that Neovasc Inc is still dealing with several legal issues and has a liability ordered to be paid to CardiAQ. Back in 2010, CardiAQ hired Neovasc Inc in a consultative role to help it develop a transcatheter mitral valve implant device. After the partnership matured and ended, Neovasc Inc was able to develop its own device after a year but CardiAQ alleges that this was made around patents and trade secrets it owns.
Upon taking the issue to court, it was ruled that Neovasc Inc had to pay a total of $91 million in damages. At that time, the company had $25 million cash on hand and assets totaling around $30 million so it wouldn’t be enough to pay the damages immediately.
Neovasc Inc is a specialty medical device company that develops, manufactures and markets products for the cardiovascular marketplace. Its products include the Tiara technology in development for the transcatheter treatment of mitral valve disease, the Neovasc Reducer for the treatment of refractory angina, and tissue products.
The Tiara is in preclinical/early clinical stage development to provide a minimally invasive transcatheter device for patients experiencing mitral regurgitation as a result of mitral heart valve disease. The Reducer is an hourglass-shaped, balloon-expandable, stainless steel, bare metal device, which is implanted in the coronary sinus, creating a restriction in venous outflow from the myocardium. Neovasc Inc also produces Peripatch, a biological tissue product that is manufactured from pericardium.
