Artivion, Inc. (NYSE: AORT) has announced amendments to its credit facility and option purchase agreements with Endospan Ltd., a privately-held developer of the Nexus® stent graft system. The amendments include providing Endospan with up to $25 million in additional loans, reducing the upfront payment associated with the purchase option from $250 million to $175 million, and eliminating the $100 million minimum payout for the earnout.
The Nexus stent graft system, developed by Endospan, is the first and only approved branched endovascular system to treat aortic arch disease. It addresses a global market opportunity estimated at $600 million annually. Artivion's Chairman, President, and CEO, Pat Mackin, expressed confidence in the Nexus technology and its potential to expand the company's total addressable market.
Under the amended credit facility, Artivion will provide additional debt financing to Endospan over three tranches, with the first $7 million drawn at close and subsequent tranches subject to the progress and achievement of the Nexus PMA. The terms of the loan remain nearly identical to the original $15 million loan, with both original and new loans benefiting from a first priority lien in Endospan assets.
The amended purchase option gives Artivion the right to acquire Endospan for an upfront payment of $175 million, less previously extended loans and accrued interest, and an additional payment in the form of an earnout at two years post-exercise of 2.5 times incremental year two revenue. The amendments have been approved by both companies’ boards of directors and Endospan’s security holders, with no changes to the existing exclusive distribution agreement.
Artivion does not anticipate the amended agreement with Endospan to have a material impact on its full-year 2024 financial guidance. The company is a medical device company focused on developing solutions for cardiac and vascular surgeons, marketing and selling products in over 100 countries worldwide.
Endospan, headquartered in Herzlia, Israel, has received CE-mark to commercialize the Nexus stent graft system in Europe. It is a pioneer in the endovascular repair of aortic arch disease, aiming to address the needs of patients diagnosed with dilative lesions in or near the aortic arch.
These amendments reflect Artivion's continued investment in the advancement of aortic arch surgery and its commitment to expanding its market presence in the field of cardiac and vascular surgery. As a result of these announcements, the company's shares have moved -0.8% on the market, and are now trading at a price of $25.45. Check out the company's full 8-K submission here.
