Exhibit 99
NEWS RELEASE
March 29, 1999
Contact:
Integra LifeSciences Corporation Noonan/Russo Communications, Inc.
Judy Brenna, Director, Corporate Communications (212) 696-4455
(609) 936-2398 Meredith Milewicz, Investor, x228
jbrenna@integra-LS.com Ernie Knewitz, Media, x204
Integra LifeSciences Announces Acquisition of NeuroCare
A Leader in Neurosurgical Implants and Monitoring Devices
Plainsboro, NJ, March 29, 1999/PR Newswire/--Integra LifeSciences Corporation
(Nasdaq: IART) today announced that it has acquired the business, including
certain assets and liabilities of the NeuroCare group of companies, a leading
provider of neurosurgical products, for an acquisition price of $25 million.
NeuroCare designs, manufactures and sells implants, instruments and monitors
used in neurosurgery and intensive care units, primarily for the treatment of
hydrocephalus and neurological trauma. NeuroCare's product lines include the
Camino, Heyer-Schulte, Redmond and Neuro Navigational brand names.
Revenue of the acquired business was $32.5 million in 1998 and earnings before
interest, taxes, depreciation and amortization were $5.6 million, excluding a
goodwill impairment charge. Integra believes that the acquisition will be
accretive to earnings.
In addition to NeuroCare's comprehensive portfolio of neurosurgical products,
its 18 direct sales representatives and three clinical specialists provide
Integra with a leading sales and marketing network in the U.S. for Integra's
pipeline of neurosurgical products. Integra's newest neurosurgical medical
device, DuraGenTM Dural Graft Matrix, recently received the CE Mark
Certification for marketing in the European Union, and is currently under FDA
review. Integra's peripheral nerve guide is in Phase II clinical trials in
Europe. Altogether, NeuroCare's direct domestic sales force, combined with a
network of approximately 60 international distributors, enable the Company to
sell products in over 50 countries worldwide.
The $25 million acquisition price was comprised of $14 million of cash and $11
million of assumed indebtedness under a term loan from Fleet Capital
Corporation. Fleet is also providing
a $4 million revolving credit facility. The cash portion of the purchase price
was financed in part by affiliates of Soros Private Equity Partners LLC, through
the sale of $10 million of Integra Series B Preferred Stock and related
warrants. The convertible preferred shares are convertible into approximately
2.6 million shares of Integra common stock and the warrants are to acquire
240,000 shares of Integra common stock. The conversion feature in Soros Private
Equity Partners' affiliates' investment is not subject to any future adjustment
tied to Integra's stock price. Integra will provide the balance of the cash
portion of the purchase price.
Stuart M. Essig, Integra President and Chief Executive Officer, commented, "This
acquisition transforms Integra. It establishes Integra's neurosurgical business
as an industry leader, broadens and strengthens Integra with a well-trained and
experienced sales group, and strengthens Integra's revenues and cash flow. If
the acquisition had occurred at the beginning of 1998, the combined revenue of
Integra and NeuroCare would have been approximately $50 million during 1998. We
are now positioned to accelerate the pace of our acquisition and partnership
program in 1999. Each new acquisition strengthens our strategic plan for
becoming a global leader of implantable medical devices and biopharmaceutical
therapies. We are especially pleased that sophisticated investment advisors like
Soros Private Equity Partners recognize Integra's potential in the marketplace."
Neal Moszkowski, a partner at Soros Private Equity Partners, said, "We are
pleased to complete this investment in Integra LifeSciences to help finance the
acquisition of the NeuroCare group of companies. We have the utmost confidence
in management's ability to integrate NeuroCare effectively. Furthermore, the
acquisition is substantially accretive and positions Integra to accelerate the
commercialization of its neurosurgical product portfolio, particularly
DuraGen(TM)."
NeuroCare's assets include the Camino manufacturing, packaging and distribution
facility in San Diego, CA, which manufactures the Camino and Neuro Navigational
brand products, and the Heyer-Schulte manufacturing facility in Anasco, Puerto
Rico, as well as corporate headquarters located in Pleasant Prairie, WI. While
leveraging the existing NeuroCare infrastructure, Integra anticipates realizing
significant cost reductions through the consolidation of its facilities. Integra
expects to close NeuroCare's Pleasant Prairie facility by August 1, 1999.
Certain employees at that site will be transferred to either NeuroCare's San
Diego or Puerto Rico facilities, or to Integra's corporate headquarters and
manufacturing facility in Plainsboro, NJ. Mr. Essig noted, "Reduction in
duplicative facilities and functions has the potential to improve the
profitability of NeuroCare and Integra. The Company expects that the
consolidation will result in significant cost savings within the first 18
months."
NeuroCare will be named Integra NeuroCare and will operate as a wholly owned
subsidiary of Integra LifeSciences.
Mr. Essig also announced the following organizational appointments at Integra
NeuroCare:
George McHugh to Senior Vice President and General Manager
Simon Archibald, Ph.D. to Vice President of Research and Development
Robert Sciote to Vice President, North America Sales
Jordan Warshafsky to Vice President of Marketing
- 2 -
NationsBanc Montgomery Securities advised Integra on the acquisition.
Integra LifeSciences has its corporate headquarters in Plainsboro, NJ. Integra
NeuroCare and the Integra Corporate Research Center are located in San Diego,
CA. Integra NeuroCare also has facilities in Pleasant Prairie, WI and Anasco,
Puerto Rico. The Company has approximately 400 employees. Please feel free to
visit the Company's Website at (http://www.integra-LS.com).
Soros Private Equity Partners LLC ("SPEP") is an investment advisor and an
affiliate of Soros Fund Management LLC. SPEP is responsible for making direct
private equity investments on behalf of Quantum Industrial Partners, a $3.5
billion investment fund and one of the Quantum Group of Funds. SPEP has twelve
investment professionals located in New York and London. The Quantum Group of
Funds is not available to U.S. investors.
This news release contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. Such forward-looking
statements involve risks and uncertainties that could cause actual results to
differ from predicted results. Such statements can be identified by the use of
forward-looking terminology such as "will," "anticipate," "estimate," or similar
words. Achieving the anticipated benefits of the NeuroCare acquisition will
depend in part upon whether the integration of the two companies' businesses is
accomplished in an efficient manner, and there can be no assurance that this
will occur. Further forward-looking factors include, but are not limited to, new
product development, governments approvals, market potential and resulting sales
as well as potential therapeutic applications, and additional acquisitions. In
addition, the economic, competitive, governmental, technological and other
factors identified in Integra's filings with the Securities and Exchange
Commission could affect such results.
Background Fact Sheets follow:
- 3 -
Integra NeuroCare Fact Sheet
Integra NeuroCare is a wholly owned subsidiary of Integra LifeSciences
Corporation.
Integra NeuroCare is a leading supplier of neurosurgical products with sales in
1998 of over $32 million. NeuroCare sells direct in the United States through 18
direct sales representatives and three clinical specialists in the U.S. and
through approximately 60 international distributors who cover over 50 countries
worldwide.
The NeuroCare group of companies has had a strong record of innovation in the
field of neurosurgical products. Roderick G. Johnson founded NeuroCare in early
1994 in partnership with Continental Illinois Venture Corporation, and
subsequently acquired the Heyer-Schulte neurosurgical shunt business; the Camino
Laboratories intracranial pressure (ICP) monitoring devices; certain assets of
Redmond Neurotechnologies, a provider of specialty surgical instruments; and the
Neuro Navigational neuroendoscopy product line.
From 1995 to 1998, NeuroCare increased revenue by a compound annual growth rate
of approximately 13 percent, including acquisitions, with over 90 percent of
total revenue from the Camino and Heyer-Schulte divisions.
NeuroCare has established an excellent reputation in the neurosurgery community
by consistently bringing innovative technologies to market for intracranial
pressure monitoring, neurosurgical shunting and neuroendoscopy.
Integra NeuroCare's products are as follows:
- --------------------------------------- ------------------------------------------------- --------------------------------------
Products Use Brand
- --------------------------------------- ------------------------------------------------- --------------------------------------
Intracranial monitoring For continuous pressure and temperature Camino and Ventrix
monitoring of the brain following injury
Neurosurgical shunts Specifically designed for the treatment of the Heyer-Schulte
chronic condition, hydrocephalus, i.e. excess
pressure in the bin, as well as hemodynamic
shunting
Neuroendoscopy For minimally invasive surgical access to the Neuro Navagational
brain
Neurosurgical instruments Specialized surgical instruments for Redmond
neurosurgeons
Dural grafts For repair of damage to the dura, the membrane DuraGen(TM)
that encases the brain and spinal column Launch anticipated in 1999
- 4 -
Integra NeuroCare was created through the merger of companies. Heyer-Schulte was
the first neurosurgical shunt. Camino was the first continuous intracranial
pressure monitoring system. NeuroNavigational was the first endoscopy system
designed for neurosurgeons.
Integra NeuroCare remains a leader with two major new products anticipated to
launch in 1999. In addition to DuraGen(TM), the Company anticipates the 1999
launch of a new line of Heyer-Schulte products for improved neurosurgical
shunting, which allow appropriate drainage in both standing and supine positions
(the Beverly shunt series).
Integra NeuroCare products are manufactured in three facilities -San Diego,
California produces Camino, Ventrix, and Neuro Navigational products;
Plainsboro, New Jersey produces DuraGen(TM) products; and the Anasco, Puerto
Rico facility produces Heyer-Schulte products.
Integra LifeSciences Fact Sheet
Integra LifeSciences Corporation (Nasdaq: IART) develops, manufactures and
markets medical devices, implants and biomaterials that target and control cell
behavior within the patient's body. The Company sells its products in more than
50 countries around the world and is focused on four main business units:
neurosurgical products, skin repair and burn products, medical products
including orthopedic products, and new businesses and ventures.
Integra was founded in 1989 as a technology consolidator. Integra acquired
INTEGRA(R) Artificial Skin from Marion Labs and successfully took it through the
FDA approval process, becoming on March 1, 1996 the first tissue regeneration
product approved for commercialization in the U.S. In 1995, Integra became a
publicly held company, listed on the Nasdaq National Market, when it acquired
Telios Pharmaceuticals in San Diego and its proprietary peptide technologies. In
1998, Integra consolidated Telios operations and other R & D programs into its
Corporate Research Center in San Diego. In September 1998, Integra acquired
Rystan Company Inc.
During 1998, Integra initiated and completed alliances with the following major
corporations:
1. Johnson & Johnson Medical, Inc. (NYSE: JNJ) for licensing and
distribution of BIOPATCH(TM) Antimicrobial Dressing;
2. Century Medical, Inc., a subsidiary of ITOCHU, for supply and
distribution in Japan of INTEGRA(R) Artificial Skin, Helistat(R) and
Helitene(R), and the Company's two neurosurgical products, DuraGen(TM)
Dural Graft Matrix and peripheral nerve regeneration conduit;
- 5 -
3. Bionx Implants, Inc. (Nasdaq: BINX) for supply of absorbable tyrosine
polymers for use in orthopedic fracture fixation devices;
4. Linvatec Corporation, a subsidiary of CONMED (Nasdaq: CNMD), for supply
of absorbable tyrosine polymers for sports medicine orthopedic fixation
deices;
5. Johnson & Johnson Professional, Inc./DePuy (NYSE: JNJ) to develop an
absorbable collagen-based implant in combination with Integra's RGD
peptide technology for cartilage repair;
6. Sulzer Calcitek, Inc., a division of SulzerMedica (NYSE: SM), as
exclusive distributor for Integra's BioMend(R) collagen matrix for a
second generation guided tissue regeneration product in periodontal
surgeries;
7. Genetics Institute, Inc. (GI), a division of American Home Products
(NYSE: AHP), for exclusive supply of absorbable collagen matrices for
GI's recombinant human bone morphogenetic protein-2 (rhBMP-2) in
developing bone regeneration implants; and
8. Sofamor Danek Group, now a division of Medtronic, is GI's exclusive
licensee for spinal applications of rhBMP-2 in the U.S., using
Integra's absorbable collagen delivery matrices.
In 1998, Integra acquired Rystan Company, Inc., a pharmaceutical manufacturer
based in Little Falls, NJ. Integra subsequently sold Rystan's Panafil(R) product
line of healing and debriding agents, including the brand name and related
manufacturing equipment, to Healthpoint Ltd. of Fort Worth, Texas. Both
companies will co-market Panafil(R) as well as Healthpoint's Accuzyme(R)
debriding agent. The NeuroCare group of companies is Integra's second
acquisition in the past six months.