X-Technologies receives FDA marketing approval
Sunday, June 15, 2003
 
Israeli medical equipment company X-Technologies, which was acquired by Guidant (NYSE:GDT) two months ago, has received FDA approval for the sale of its first product.
X-Technologies is the developer of a proprietary angioplasty catheter.

X-Technologies was acquired in one of the biggest M&A deals to date for an Israeli medical devices company. The $200 million agreement, was for $60 million in cash up front, with the remainder to be paid to shareholders after FDA approval for the US market was received. The announcement is therefore significant as it means the milestone has been reached which will oblige Guidant to pay the rest of the acquisition price.

The final value of the acquisition will be $140-$200 million, depending on the volume of sales.

Yigal Erlich, chair and managing partner of the Yozma Group, an investor in X-Technologies, told "Globes" that the FDA approval "came earlier than expected. Of course, it was fairly certain that the FDA would approve the product, the question was how long it would take".

X-Technologies was founded in 1999 by a group of private entrepreneurs from the US and Israel, along with Dr. Shmuel Bukshpan, Dr. Uri Halavi, and the Lewis C. Pell group. The company closed a $12 million financing round at $35 million company value, after money, in late 2001. Yozma Venture Capital, Challenge Fund - Etgar, Giza Group, Trefoil Capital Investors, ABS and private investors participated.

X-Technologiesís founders and employees CEO Guy Shinar, CTO Ronald J. Solar, and Dr. Halavi apparently hold 25% of the company. The remainder of shares is divided between venture capital investors from Israel and the US. The Challenge Fund - Etgar owns a 45% stake in X-Technologies, Yozma, Giza 1 and 2 each own 6%.

The FDA granted approval to the companyís FX Mini-Rail dilatation catheter. This is an angioplasty catheter, based on technology that opens blockages, while minimizing damage to healthy arterial tissue. The catheter opens coronary arterial blockages; a pull wire aids in tracking vessels while a second, steerable guide wire helps anchor the catheter in the lesion. The pull wire etches off plaque upon balloon inflation. The dual wires are completely external to the balloon and work together to dilate most types of lesions.

The product was given the CE mark in December 2001, and had $2 million in sales to the European market in 2002.
 
 

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