Anika's Acquisition of Fidia Advanced Biopolymers
Overview
Anika’s vision is to provide therapeutic products that cover the continuum of patient care from palliative, to protective, to restorative products. Our December 2009 acquisition of Fidia Advanced Biopolymers, s.r.l. (“FAB”) marked a strategically important step toward realizing this vision.
Previously a wholly owned subsidiary of the privately held Italian pharmaceutical company, Fidia Farmaceutici S.p.A., FAB provides hyaluronic acid-based (“HA”) products in several therapeutic areas, including orthopedic/joint health, advanced wound care, and post surgical anti-adhesion applications.
These products are marketed by FAB in Italy and through an international distributor network, in other European countries, the Middle East and Asia. FAB’s products enhance Anika’s Orthopedic/Joint Health, and Post-Surgical franchises, provide us with an exciting new Advanced Wound Care franchise, and open the door for us to participate in the exciting new frontier of tissue engineering and regenerative medicine.
Orthopedic/Joint Health Franchise
FAB has commercialized three joint health products that Anika is planning to market in the United States along with MONOVISC™, upon its approval by the FDA. These FAB products include:
- Hyaloglide®, a gel used following tendon and/or peripheral nerve surgery;
- Hyalonect®, a knitted mesh used as a bone graft wrap; and
- Hyalofast™, a non woven matrix of HA used in arthroscopic surgery for the repair of chondral and osteochondral lesions.
We believe these products will only require FDA 510K clearance. These three products – as well as most others in FAB’s portfolio – come with a meaningful clinical data package.
Our goal is to obtain FDA clearance for Hyaloglide, Hyalonect and Hyalofast by the end of Q1 2011. We are building a direct sales force to market MONOVISC in the United States, and adding these three products to our portfolio should provide us with the critical mass we need to more effectively penetrate the domestic orthopedic/joint health market.
Advanced Wound Care Franchise
FAB offers nine products for treatment of skin wounds ranging from mild dermal abrasions to third degree burns and diabetic ulcers. The products cover a variety of wound treatment solutions from debridement agents to more advanced treatments up to and including skin substitutes. FAB’s leading wound care products include Laserskin® 3D, for the regeneration of skin, and Hyalomatrix®, for treatment of burns and ulcers. Several FAB wound care products have been approved for sale in the United States. Development of an effective domestic distribution network for these products is a high priority for Anika.
Post-Surgical Franchise
Several FAB products have become part of Anika’s post-surgical franchise, and are currently marketed in many countries including the United States. These include products that prevent post-surgical adhesion in various therapeutic areas, including abdominal, pelvic and ENT surgery. With FAB’s Hyalobarrier® and Hyalobarrier® Endo, we have added two new clinically proven, post-operative adhesion barriers approved for abdominal and pelvic indications. FAB offers eight products in the ENT market. Chief among them is MeroGel™, a viscous hydrogel composed of cross-linked HA that prevents adhesions and creates a moist wound-healing environment.
Tissue Engineering
In addition to its portfolio of marketed products, FAB has developed a restorative tissue technology that promotes the attachment and growth of cells to specific scaffolds. Two FAB products – Hyalograft® 3D autograft and Laserskin autograft – make use of this technology to help skin regenerate following severe burns or serious ulcers. A third tissue regenerative product – Hyalograft C autograft – is the first bio-engineered cartilage repair product designed for minimally invasive surgical procedures. More than 5,000 patients have been treated to date with Hyalograft C autograft, and clinical data is available on more than 550 patients. FAB currently distributes these products primarily in Italy, and we plan to expand their distribution to additional European countries in 2010.
Growth and Profitability
FAB has a strong pipeline of HA-based preclinical products and research expertise that complements Anika’s excellent mid and late-stage development capabilities and manufacturing expertise. Our efforts to ensure that FAB contributes to Anika’s profitability as rapidly as possible are in part centered on integrating FAB’s R&D activities with those of Anika.
In the first quarter of 2010, we initiated a comprehensive review of all research projects across the entire company. In connection with this review, we began reorganizing the Anika and FAB research and development functions on both sides of the Atlantic. These efforts also include a drive to realize operational cost synergies.
Our plan is to eventually move FAB’s product manufacturing to Anika’s facility in the United States, where we expect to deliver significant efficiencies. We also are working to realize greater efficiencies in FAB’s product packaging. Looking ahead, by launching FAB’s joint health/orthopedic and advanced wound care products in the U.S. market, we expect to significantly improve FAB’s product gross margins and advance the business to profitability.
We expect that integrating FAB’s products, operations and R&D pipeline with ours will not only expand Anika’s scale and enhance our profitability, but also move us closer to our goal of spanning the full continuum of care, from palliative, to protecting and ultimately restoring damaged tissue.
Hyaloglide®, Hyalonect®, Hyalofast™, Hyalobarrier® products and Hyalograft®3D, Laserskin®, Hyalograft C autografts are not currently available for sale in the United States.
