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Posts Tagged ‘Kenneth Hardesty’

The Bidding Process, Procedures for the Sale of certain Assets and Intellectual Property of AirXpanders, Inc.

Further to Gerbsman Partners sales letter of September 4, 2019 and “Update to Bidding Process” on September 9, 2019, regarding the sale of certain assets of AirXpanders, Inc. (“AirXpanders”), I am attaching an Asset Purchase Agreement (“APA”), Fixed Asset List, Trademark List, US Patent List, AirXpanders’s Data Room due diligence information list and Inventory list provided by the company.  Also, interested parties who would like to speak with Shalon Ventures regarding the potential go forward License relationship should email Barry Cheskin at bcheskin@sumadvisory.comand he will respond to you.

Please also be advised that the Bid Date for all interested parties has been moved up to Friday, September 27, 2019 from Wednesday, October 2, 2019.   The reason for this is that the fixed assets must be removed from the premises no later than September 30, 2019.

It is recommended that when potential interested parties bid, they should submit their bid on:

  1. Fixed Assets Only
  2. Inventory Only
  3. Intellectual Property – including Patents, Trademarks, Clinical Trials, etc. Only
  4. A combination of all of the above

Prior to the bid date of September 27, 2019, I would encourage and recommend that all interested parties have their counsel speak with Jonathan Bell, Esq., counsel to Oxford Finance LLC and AirXpanders Assest Liquidation Company LLC, to discuss any questions or comments of a legal nature relating to the transaction.  Jonathan is available at 617 310 6038 and bellj@gtlaw.com

Please review the “Important Legal Notice” below in that potential purchasers should not rely on any information contained provided by Gerbsman Partners (or their respective staff, agents, and attorneys) in connection herewith, whether transmitted orally or in writing as a statement, opinion, or representation of fact.  Interested parties should satisfy themselves through independent investigations as they or their legal and financial advisors see fit.  

Ken, Jim and I will be following up to review the updated Bidding Process, schedule due diligence meetings and answer any questions regarding the “Date Certain M&A Process”.

Any and all the assets of AirXpanders will be sold on an “as is, where is” basis and will be subject to “The Bidding Process for Interested Buyers”, outlined below.

 

Gerbsman Partners (www.gerbsmanpartners.com) has been retained by AirXpanders Assets Liquidation Company, LLC (“Seller”) to solicit interest for the acquisition of all, or substantially all of, AirXpanders’ assets (the “AirXpanders Assets”).  Seller recently stepped into a loan (the “AirXpanders Loan”) originally made by Oxford Finance LLC (“Oxford”) to AirXpanders, Inc. (“AirXpanders”), the repayment of which was secured by a pledge of substantially all of AirXpanders’ Assets.  Subsequent to the acquisition of the AirXpanders Loan, Seller is completing a UCC foreclosure with respect to the AirXpanders Assets in order to sell the AirXpanders Assets, free and clear of all liens, claims and interests, in accordance with the sale process outlined herein. 

 

IMPORTANT LEGAL NOTICE

The information in this memorandum does not constitute the whole or any part of an offer or a contract.

The information contained in this memorandum relating to AirXpanders’ Assets has been supplied by former employees of AirXpanders who are now engaged as consultants to AirXpanders Assets Liquidation Company, L.L.C. (the “Seller”).  Nothing contained herein has been independently investigated or verified by Seller, Gerbsman Partners, Oxford Finance, or their respective agents.

Potential purchasers should not rely on any information contained in this memorandum or provided by Seller or Gerbsman Partners (or their respective staff, agents, and attorneys) in connection herewith, whether transmitted orally or in writing as a statement, opinion, or representation of fact.  Interested parties should satisfy themselves through independent investigations as they or their legal and financial advisors see fit.

Seller, Oxford Finance, and Gerbsman Partners, and their respective staff, agents, and attorneys, (i) disclaim any and all implied warranties concerning the truth, accuracy, and completeness of any information provided in connection herewith and (ii) do not accept liability for the information, including that contained in this memorandum, whether that liability arises by reasons of Seller’s or Gerbsman Partners’ negligence or otherwise. Consultants, and their respective staff, agents, and attorneys, (i) disclaim any and all implied warranties concerning the truth, accuracy, and completeness of any information provided in connection herewith and (ii) do not accept liability for the information, including that contained in this memorandum, whether that liability arises by reasons of Seller’s, Consultants’ or Gerbsman Partners’ negligence or otherwise. 

Any sale of the AirXpanders Assets will be made on an “as-is,” “where-is,” and “with all faults” basis, without any warranties, representations, or guarantees, either expressed or implied, of any kind, nature, or type whatsoever from, or on behalf of Seller, Consultants and Gerbsman Partners. Without limiting the generality of the foregoing, Seller, Consultants and Gerbsman Partners and their respective staff, agents, and attorneys, hereby expressly disclaim any and all implied warranties concerning the condition of the AirXpanders Assets and any portions thereof, including, but not limited to, environmental conditions, compliance with any government regulations or requirements, the implied warranties of habitability, merchantability, or fitness for a particular purpose.

This memorandum contains confidential information and is not to be supplied to any person without Gerbsman Partners’ prior consent. This memorandum and the information contained herein are subject to the Non-Disclosure Agreement attached hereto as Appendix A.

 

The Bidding Process for Interested Buyers

Interested and qualified parties will be expected to sign the Non-Disclosure Agreement (attached hereto as Appendix A) to have access to the due diligence data room documentation (“Due Diligence Access”), and the AirXpanders Video. Each interested party, as a consequence of the Due Diligence Access granted to it, shall be deemed to acknowledge and represent (i) that it is bound by the bidding procedures described herein; (ii) that it has had an opportunity to inspect and examine the AirXpanders Assets and to review all pertinent documents and information with respect thereto; (iii) that it is not relying upon any written or oral statements, representations, or warranties of Seller or Gerbsman Partners, or their respective staff, agents, or attorneys; and (iv) all such documents and reports have been provided solely for the convenience of the interested party, and Seller and Gerbsman Partners (and their respective staff, agents, or attorneys) do not make any representations as to the accuracy or completeness of the same.  

Following an initial round of due diligence, interested parties will be invited to participate with a sealed bid, for the acquisition of the AirXpanders Assets. Each sealed bid must be submitted so that it is received by Gerbsman Partners no later than  Friday, September 27, 2019 at 2:00pm Pacific Daylight Time (the “Bid Deadline”) at Gerbsman Partners office, located at 211 Laurel Grove Avenue, Kentfield, CA 94904.  Please also email steve@gerbsmanpartners.com with any bid.

Bids should identify those assets being tendered for in a specific and identifiable way. In particular, please identify separately certain equipment or other fixed assets.  The attached AirXpanders fixed asset list may not be complete and bidders interested in the AirXpanders equipment must submit a separate bid for such assets. 

Any person or other entity making a bid must be prepared to provide independent confirmation that they possess the financial resources to complete the purchase.  All bids must be accompanied by a refundable deposit in the amount of $200,000 payable to AirXpanders Liquidation Company, LLC.  Refundable deposit wiring instructions will be provided at a later date. The winning bidder will be notified within three (3) business days of the Bid Deadline.   Unsuccessful bidders will have their deposit returned to them within three (3) business days of notification that they are an unsuccessful bidder. 

Seller reserves the right to, in its sole discretion, accept or reject any bid, or withdraw any or all assets from sale.  Interested parties should understand that it is expected that the highest and best bid submitted will be chosen as the winning bidder and bidders may not have the opportunity to improve their bids after submission.   

Seller will require the successful bidder to close within seven (7) days following acceptance of such party’s bid. Any or all of the AirXpanders Assets will be sold on an “as is, where is” basis, with no representation or warranties whatsoever.

All sales, transfer, and recording taxes, stamp taxes, or similar taxes, if any, relating to the sale of the AirXpanders Assets shall be the sole responsibility of the successful bidder and shall be paid to Seller at the closing of each transaction. 

For additional information, please see below and/or contact:

 

Steven R. Gerbsman                                                   

Gerbsman Partners                

steve@gerbsmanpartners.com                                 

 

Kenneth Hardesty                                                      

Gerbsman Partners                                                    

ken@gerbsmanpartners.com

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Sale of Assets of AirXpanders, Inc.

Gerbsman Partners (www.gerbsmanpartners.com) has been retained by AirXpanders Assets Liquidation Company, LLC (“Seller”) to solicit interest for the acquisition of all, or substantially all of, AirXpanders’ assets (the “AirXpanders Assets”).  Seller recently stepped into a loan (the “AirXpanders Loan”) originally made by Oxford Finance LLC (“Oxford”) to AirXpanders, Inc. (“AirXpanders”), the repayment of which was secured by a pledge of substantially all of AirXpanders’ Assets.  Subsequent to the acquisition of the AirXpanders Loan, Seller is completing a UCC foreclosure with respect to the AirXpanders Assets in order to sell the AirXpanders Assets, free and clear of all liens, claims and interests, in accordance with the sale process outlined herein. 

Headquartered in San Jose, California, AirXpanders was a U.S. based medical device company whose principal business was to design, manufacture, sell and distribute medical devices used in two-stage breast reconstruction procedures following mastectomy. The first application of this technology, commercialized in the US and Australia, was tissue expansion for post-mastectomy breast reconstruction. Other applications of the technology may include tissue expansion in various parts of the body, including breasts, buttocks, thighs, etc. 

AirXpanders sought to engage in a sale of its assets or other restructuring during the first half of 2019. It became clear that bidders would require a sale process through Section 363 of Chapter 11 of the United States Bankruptcy Code.  AirXpanders determined that it had insufficient resources to complete a Chapter 11 process, and accordingly filed a proceeding under Chapter 7 of the United States Bankruptcy Code on July 24, 2019.  A Trustee was appointed by the Bankruptcy Court who elected not to market AirXpanders’ assets.  Oxford then filed a motion for relief from the automatic stay, which motion has been granted. Oxford thereafter is transferring its notes owed by AirXpanders to Seller, who is foreclosing on the AirXpanders Assets for the purpose of selling them on an “as is, where is” basis.

AirXpanders was incorporated in Delaware in 2005 and was headquartered in San Jose, California. AirXpanders has been publicly traded on the Australian stock exchange since 2015 (ASX: AXP). Nearly $130 million has been invested in the technology and products of AirXpanders.

Seller has retained key past employees on a consulting basis (“Consultants”) who will endeavor to make themselves available to assist potential purchasers with due diligence and assist with a prompt and efficient transition at a mutually convenient time.

IMPORTANT LEGAL NOTICE:

The information in this memorandum does not constitute the whole or any part of an offer or a contract.

The information contained in this memorandum relating to AirXpanders’ Assets has been supplied by former employees of AirXpanders who are now engaged in as Consultants to Seller.  Nothing contained herein has been independently investigated or verified by Seller, Gerbsman Partners, Oxford Finance, or their respective agents.

Potential purchasers should not rely on any information contained in this memorandum or provided by Seller or Gerbsman Partners (or their respective staff, agents, and attorneys) in connection herewith, whether transmitted orally or in writing as a statement, opinion, or representation of fact.  Interested parties should satisfy themselves through independent investigations as they or their legal and financial advisors see fit.

Seller, Oxford Finance, and Gerbsman Partners, and their respective staff, agents, and attorneys, (i) disclaim any and all implied warranties concerning the truth, accuracy, and completeness of any information provided in connection herewith and (ii) do not accept liability for the information, including that contained in this memorandum, whether that liability arises by reasons of Seller’s or Gerbsman Partners’ negligence or otherwise. Consultants, and their respective staff, agents, and attorneys, (i) disclaim any and all implied warranties concerning the truth, accuracy, and completeness of any information provided in connection herewith and (ii) do not accept liability for the information, including that contained in this memorandum, whether that liability arises by reasons of Seller’s, Consultants’ or Gerbsman Partners’ negligence or otherwise.

Any sale of the AirXpanders Assets will be made on an “as-is,” “where-is,” and “with all faults” basis, without any warranties, representations, or guarantees, either expressed or implied, of any kind, nature, or type whatsoever from, or on behalf of Seller, Consultants and Gerbsman Partners. Without limiting the generality of the foregoing, Seller, Consultants and Gerbsman Partners and their respective staff, agents, and attorneys, hereby expressly disclaim any and all implied warranties concerning the condition of the AirXpanders Assets and any portions thereof, including, but not limited to, environmental conditions, compliance with any government regulations or requirements, the implied warranties of habitability, merchantability, or fitness for a particular purpose.

This memorandum contains confidential information and is not to be supplied to any person without Gerbsman Partners’ prior consent. This memorandum and the information contained herein are subject to the Non-Disclosure Agreement attached hereto as Appendix A.

Company Profile

AirXpanders was a U.S. based medical device company whose principal business was to design, manufacture, sell and distribute medical devices used in two-stage breast reconstruction procedures following mastectomy. The primary product, the AeroForm Tissue Expander System (AeroForm), is a needle-free, patient-controlled tissue expander used in patients undergoing two-stage breast reconstruction following mastectomy prior to the insertion of a breast implant.  AirXpanders’ mission was to be the global leader in reconstructive surgery products and to become the standard of care in two-stage breast reconstruction.

AeroForm was granted its first CE mark in Europe in October 2012, was approved by Australia’s Therapeutic Goods Administration, or TGA, in Australia in October 2013, and initial marketing release of AeroForm was in Australia in January 2015.  U.S. Food and Drug Administration, or FDA, granted AeroForm de novo marketing authorization in December 2016 (as a Class II medical device), and initial marketing release of AeroForm in the U.S. started in January 2017.  After FDA de novo clearance for AeroForm, AirXpanders submitted a 510(k) application for a product change related to enhanced film material. This 510(k) was cleared by the FDA in April 2017. The product covered in this clearance, internally referred to as AeroForm 3.0, is the primary product marketed in the US until AirXpanders filed for Chapter 7 in July 2019.  In Australia, AeroForm achieved approximately 20% market share during the third year of commercialization.   In the US, market share was in the single digits, due to the short time period the product was available in the US.  Worldwide revenue reached approximately $2mm per quarter, with over 90% of sales in the US in the most recent quarters.

The AeroForm Tissue Expander System is the primary product and the core technology of AirXpanders.  The device kit consists of an implant and a remote controller.   The implant is a two-layer balloon system which contains a cartridge of CO2.   The remote controller is used to open the magnetic valve in the CO2 cartridge, enabling the controlled release of CO2 into the balloon.  Unlike a conventional saline tissue expander, the patient can do the expansion entirely on her own, with no need to go back to the doctor every week or so for the saline injections necessary to fill a saline based tissue expander.   The patient has full control over the pace of her expansion and avoids the inconvenience and pain of repeated saline injections.  Plastic surgeons also prefer to avoid the repeated saline injections, as they are not reimbursed for this activity.

The product is packaged and delivered sterilized via ethylene oxide sterilization.  The remote control is “paired” with a single implant at the time of the surgery and will work only with that paired implant.  The system has proven to be an effective, easy-to-learn, and easy-to-use product for patients who choose two stage breast reconstruction post-mastectomy.

AirXpanders was incorporated in Delaware in 2005 and was headquartered in San Jose, California. AirXpanders has been publicly traded on the Australian stock exchange since 2015 (ASX: AXP). Nearly $130 million has been invested in the technology and products of AirXpanders. To date, AeroForm has been approved for marketing and sales in the United States, Australia and Europe, although commercialization has been limited to Australia and the United States, given more favorable pricing and reimbursement in those countries.

As a public company headquartered in the United States, AirXpanders was also an SEC filing company, although shares of AirXpanders were only traded in Australia.   More information, including recent 10-Q and 10-k filings, can be found at the SEC web site, https://www.sec.gov/edgar/searchedgar/companysearch.html

AirXpanders, Inc. believes its assets are attractive for a number of reasons:

  • AirXpanders’ intellectual property and its license covers an implantable device with inflatable chamber, compressed gas source and antenna. This includes claims related to an external device in wireless communication with an antenna to control the incremental release of gas from the gas source and inflate the chamber.
  • These patents include five (5) issued U.S. patents, 45 issued OUS patents, three (3) pending U.S. patent applications, and nine(9) pending foreign applications in Australia, Canada, and Europe.
  • US FDA clearances include the initial 510(k) de novo clearance in 2016 (DEN150055); a subsequent 510(k) clearance for a material change cleared in April 2017 (K170075) and an additional clearance for the Smooth Shell version of the AeroForm implant in July 2019 (K191138).  The AeroForm Tissue Expander System is indicated for use in soft tissue expansion in breast reconstruction following mastectomy, for the treatment of underdeveloped breasts, and for the treatment of soft tissue deformities in the breast.  The AeroForm Tissue Expander is intended for temporary subcutaneous or submuscular implantation and is not intended for use beyond six months.
  • The AeroForm Tissue Expander System is CE marked, however, the newer smooth shell version has not yet been reviewed by a notified body for CE.    AirXpanders notified body was BSI.
  • AirXpanders executed an extensive series of clinical trials, including the largest trial ever done for tissue expanders in the US.   The XPAND trial was a pivotal IDE trial in the US.  It was a prospective, multi-center, randomized (2:1) controlled, open label study, which enrolled a total of 150 patients for 256 implants.   Results included significantly shorter time to expansion and time to reconstruction for AeroForm versus saline expanders.
  • AeroForm was sold in the US and in Australia.   A direct sales force was in place in Australia until June of 2018, when AirXpanders transitioned to a distributor.  AeroForm has very strong surgeon support in Australia and is estimated to have 20% market share.
  • Over 4,500 AeroForm devices have been implanted.
  • Over 160 hospitals ordered AeroForm in the twelve months ending July 2019.  Average price in the US was approximately $2,600 per unit (a unit refers to an implant and a remote controller).
  • AeroForm, like other tissue expanders, is fully reimbursed as a supply cost under the tissue expansion DRG system.  In fact, the Women’s Health and Cancer Rights Act of 1998 requires any insurance company which covers mastectomy procedures to also cover post-mastectomy breast reconstruction.   To further encourage doctors to discuss reconstruction efforts with their patients, Congress passed the Breast Cancer Education Act in 2015, requiring doctors to inform women undergoing a mastectomy of their reconstruction options.
  • AirXpanders developed an economic calculator and information kit for use with hospital Value Analysis Committee’s (“VAC’S”) in the US.
  • AirXpanders achieved ISO 13485 certification.
  • AirXpanders received California FDB (Food and Drug Branch) approval.
  • AirXpanders was vertically integrated with significant manufacturing capacity.   Manufacturing capability was located in San Jose, CA and in San José, Costa Rica.   While the contract manufacturer in San José, Costa Rica could be re-engaged, AirXpanders also maintained a full production line, with limited capacity, and the ability to further expand.

 

Intellectual Property Summary

 

  • AirXpanders intellectual property covers an Implantable device with inflatable chamber, compressed gas source and antenna. This includes claims related to an external device in wireless communication with an antenna to control the incremental release of gas from the gas source and inflate the chamber.
  • These patents include five (5) issued U.S. patents, 45 issued OUS patents, three (3) pending U.S. patent applications, and nine (9) pending foreign applications in Australia, Canada, and Europe. In the US, AirXpander owns, or co-owns with Shalon Ventures, all currently issued patents.  Additional US patents, based upon early disclosures of Shalon Ventures, may be available.  A royalty of 3% of net sales of the licensed inventions is paid to Shalon Ventures with respect to  licensed patents and patent applications under an exclusive license entered into with Shalon Ventures on March 9, 2005, amended on March 9, 2009, January 9, 2012, and January 15, 2014, collectively referred to as the License Agreement. The License Agreement provides AirXpanders with certain rights to OUS patents owned by Shalon Ventures, exclusive rights to the co-owned US patents, and patent prosecution rights for patents owned or co-owned by Shalon Ventures and licensed to AirXpanders.   The License Agreement with Shalon Ventures is currently in dispute –  Shalon Ventures sent a termination notice on July 18, 2019 due to non-payment of certain nominal royalties, but that license is not terminable due to the pendency of the Chapter 7 proceeding.  In addition, there is a 90 day cure period post termination notice to bring the payment of royalties current.

AirXpanders’ Assets

AirXpanders has developed a unique, FDA cleared product that meets the needs of physicians and patients alike.  The concept is unique, well protected by patents, and well recognized by plastic surgeons throughout the US and Australia.   Key assets fall into a variety of categories, including:

  • Patents, patent applications, and trademarks
  • Regulatory approvals in US, Australia, and Europe
  • Established customers, accounts, surgeon advocates and satisfied patients
  • Established hospital reimbursement, and a track record of success with GPO accounts and hospital VAC’s
  • The only needle free tissue expander available
  • Positive long-term clinical feedback from top surgeons and their patients
  • Next generation product designs, including significant cost reduction and design simplification
  • Manufacturing and equipment developed internally and easily scalable

The AirXpanders Assets will be sold, in whole or in part, to the highest bidder. The sale of these assets is being conducted by Seller, who has secured an interest in the secured loans provided by Oxford Finance, LLC. Certain former employees of AirXpanders will be available to assist purchasers with due diligence and a prompt, efficient transition to new ownership. Notwithstanding the foregoing, AirXpanders former employees should not be contacted directly without the prior consent of Gerbsman Partners.

Previous Management

 

Frank Grillo — President & CEO, and Executive Director

Mark Payne – Vice President, Research and Development

 

The Bidding Process for Interested Buyers  

Interested and qualified parties will be expected to sign the Non-Disclosure Agreement (attached hereto as Appendix A) to have access to the due diligence data room documentation (“Due Diligence Access”), and the AirXpanders Video. Each interested party, as a consequence of the Due Diligence Access granted to it, shall be deemed to acknowledge and represent (i) that it is bound by the bidding procedures described herein; (ii) that it has had an opportunity to inspect and examine the AirXpanders Assets and to review all pertinent documents and information with respect thereto; (iii) that it is not relying upon any written or oral statements, representations, or warranties of Seller or Gerbsman Partners, or their respective staff, agents, or attorneys; and (iv) all such documents and reports have been provided solely for the convenience of the interested party, and Seller and Gerbsman Partners (and their respective staff, agents, or attorneys) do not make any representations as to the accuracy or completeness of the same. 

Following an initial round of due diligence, interested parties will be invited to participate with a sealed bid, for the acquisition of the AirXpanders Assets. Each sealed bid must be submitted so that it is received by Gerbsman Partners no later than  Wednesday, October 2, 2019 at 2:00pm Pacific Daylight Time (the “Bid Deadline”) at Gerbsman Partners office, located at 211 Laurel Grove Avenue, Kentfield, CA 94904.  Please also email steve@gerbsmanpartners.com with any bid.

Bids should identify those assets being tendered for in a specific and identifiable way. In particular, please identify separately certain equipment or other fixed assets.  The attached AirXpanders fixed asset list may not be complete and bidders interested in the AirXpanders equipment must submit a separate bid for such assets.

Any person or other entity making a bid must be prepared to provide independent confirmation that they possess the financial resources to complete the purchase.  All bids must be accompanied by a refundable deposit in the amount of $200,000 payable to AirXpanders Liquidation Company, LLC.  Refundable deposit wiring instructions will be provided at a later date. The winning bidder will be notified within three (3) business days of the Bid Deadline.   Unsuccessful bidders will have their deposit returned to them within three (3) business days of notification that they are an unsuccessful bidder.

Seller reserves the right to, in its sole discretion, accept or reject any bid, or withdraw any or all assets from sale.  Interested parties should understand that it is expected that the highest and best bid submitted will be chosen as the winning bidder and bidders may not have the opportunity to improve their bids after submission.  

Seller will require the successful bidder to close within seven (7) days following acceptance of such party’s bid. Any or all of the AirXpanders Assets will be sold on an “as is, where is” basis, with no representation or warranties whatsoever.

All sales, transfer, and recording taxes, stamp taxes, or similar taxes, if any, relating to the sale of the AirXpanders Assets shall be the sole responsibility of the successful bidder and shall be paid to Seller at the closing of each transaction.

For additional information, please see below and/or contact:

 

Steven R. Gerbsman                                                                                                           

steve@gerbsmanpartners.com                                

 

Kenneth Hardesty                                                                                                             

ken@gerbsmanpartners.com

 

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SALE OF BioInspire Technologies, Inc.

Gerbsman Partners (www.gerbsmanpartners.com) has been retained by BioInspire Technologies, Inc. (www.bioinspiretechnologies.com) to solicit interest for the acquisition of all, or substantially all, the assets of BioInspire Technologies, Inc. 

BioInspire Technologies (BioInspire) is a privately held biotechnology company located in Palo Alto, California, founded in 2009. BioInspire has developed a bioabsorbable, drug eluting implant for targeted drug delivery with initial focus in the ENT market.  The acquisition of BioInspire enables immediate access to proprietary technology and preclinical combination products.

BioInspire has a patent portfolio that consists of eight (8) US patents covering broad claims covering product formulation, indications, manufacturing and methods of delivery.  These cover multiple applications in the pipeline.

BioInspire has developed: 

  • A novel technology for targeted drug delivery via a protein based, bioabsorbable implant, SinuBand
  • Techniques for manufacture and testing of the SinuBand implant
  • Approved 510(k) for the SinuBand implant (w/o API)
  • Eight (8) US patents with pending applications in EU
  • Patented delivery method for ENT applications

BioInspire has no recurring revenues, product or collaboration related. Its value lies in the preclinical and clinical assets produced by its underlying and proprietary technology.

 

IMPORTANT LEGAL NOTICE:

The information in this memorandum does not constitute the whole or any part of an offer or a contract.

The information contained in this memorandum relating to BioInspire’s Assets has been supplied by BioInspire.  It has not been independently investigated or verified by Gerbsman Partners or its agents.Potential purchasers should not rely on any information contained in this memorandum or provided by BioInspire, or Gerbsman Partners (or their respective staff, agents, and attorneys) in connection herewith, whether transmitted orally or in writing as a statement, opinion, or representation of fact. Interested parties should satisfy themselves through independent investigations as they or their legal and financial advisors see fit.

BioInspire, Gerbsman Partners, and their respective staff, agents, and attorneys, (i) disclaim any and all implied warranties concerning the truth, accuracy, and completeness of any information provided in connection herewith and (ii) do not accept liability for the information, including that contained in this memorandum, whether that liability arises by reasons of BioInspire’s or Gerbsman Partners’ negligence or otherwise.  

Any sale of the BioInspire Assets will be made on an “as-is,” “where-is,” and “with all faults” basis, without any warranties, representations, or guarantees, either express or implied, of any kind, nature, or type whatsoever from, or on behalf of BioInspire or Gerbsman Partners.  Without limiting the generality of the foregoing, BioInspire and Gerbsman Partners and their respective staff, agents, and attorneys, hereby expressly disclaim any and all implied warranties concerning the condition of the BioInspire Assets and any portions thereof, including, but not limited to, environmental conditions, compliance with any government regulations or requirements, the implied warranties of habitability, merchantability, or fitness for a particular purpose.

This memorandum contains confidential information and is not to be supplied to any person without Gerbsman Partners’ prior consent.  This memorandum and the information contained herein are subject to the non-disclosure agreement attached hereto as Exhibit A.

 

Historical Company Information

BioInspire was founded to develop novel technologies to address targeted therapeutics via resorbable stint/implant technology.  Initial development focused on the cardiovascular market.  Later focus transitioned to ENT markets for clinical success.

SinuBand FP Sinus Implant is a two-sided, sterile, single-use, bioresorbable dressing (Figure 1) that is applied after ethmoidectomy performed as part of endoscopic sinus surgery (ESS).  The implant matrix is made from Fibrinogen Concentrate (Human), Polyethylene Glycol 400, Calcium Chloride Dihydrate and Riboflavin.  Each implant contains 300-1200 µg fluticasone propionate (FP), an intranasal corticosteroid.  Implants are two-sided with a white side to be placed against the mucosa and a yellow side containing a colorant (riboflavin), so that it is visible while it is being positioned on the sinus mucosa.  The implant is pre-loaded in a single-use, disposable delivery tool for ease of insertion and positioning in the post-surgical ethmoid sinus.  SinuBand FP Sinus Implant has a preliminary classification by the Office of Combination Products (OCP) as a biologic (BLA) combination product with biologic (Fibrinogen Concentrate [Human]), drug (FP) and device (delivery tool) constituent parts.

SinuBand FP is an implant that is to be used as a sinus dressing following ESS.  A delivery tool pre-loaded with the implant is part of the product configuration to ease insertion of the implant through the nasal passage and placement on the ethmoid sinus surface.  The dimensions of each implant to be inserted into the sinus are 2 cm x 0.9 cm with thickness < 0.5 mm.

 

BioInspire Company Profile

BioInspire Technologies (BioInspire) developed SinuBand FP (Fluticasone Propionate), a sinus implant intended for use following ethmoid sinus surgery to maintain sinus patency and serve as an adhesion barrier.  The product reduces surgical edema and inflammation following ESS.  SinuBand FP is a combination product with biologic (Fibrinogen Concentrate [Human]), drug (FP) and device (delivery tool) constituent parts.

The biologic component, Fibrinogen Concentrate, provides the structural matrix for the implant, similar to the use of a synthetic polymer in traditional nasal/sinus packing materials.  Fibrinogen was chosen as the optimal material for the SinuBand products for several reasons:

  • It can be formulated to create a solid, non-adherent film when dry with sufficient mechanical strength to allow ease of delivery.
  • It conforms to and creates a barrier on the surface of the tissue while maintaining patency of the sinus; it does not obstruct breathing or normal post-operative sinus drainage.
  • It is fully biocompatible and bioresorbable within the early post-operative period.

 

Impact of Technology on the Market and Why BioInspire Assets are Attractive

SinuBand Nasal Dressing: Cleared 510(k):

BioInspire’s SinuBand Nasal/Sinus Dressing is a Class I device that was cleared on July 27, 2016 under premarket notification review (K160101) by the Center for Devices and Radiological Health (CDRH).  SinuBand is indicated for use in patients undergoing nasal/sinus surgery as a space-occupying dressing to separate mucosal surfaces and prevent formation of adhesions (SinuBand 510 (k) Summary).

SinuBand addresses Unmet Clinical Need

Intranasal steroids (sprays) are first-line therapy but poor compliance limits usage and effectiveness.  Also, nasal sprays are unable to reach sinuses for full therapeutic impact.  The alternative, oral steroids, are effective but have severe side-effects.  Intranasal steroids can be used for surgical management Surgical Management.  However, the underlying inflammatory disease continues.  Post-surgical polyps and adhesion result in interventions.  Medical therapy limitations apply to post-op care.  SinuBand fills this unmet need by providing directed therapeutic impact via effective drug delivery as a vehicle to manage mucosal inflammation.  The highly conformable film adheres to any wound or mucosal surface.  SinuBand elutes fluticasone propionate post application and fully resorbs.

BioInspire’s Assets

  • Intellectual Property
  • Preclinical and safety studies have been completed on the SinuBand FP product demonstrating safety and efficacy
  • Clinical feasibility via a controlled, randomized, partially double blinded study
  • Techniques for manufacture and testing of the SinuBand implant

Development Pipeline

Initial pipeline focus is on optimizing steroid delivery in post-surgical and then allergic rhinitis applications.  Multiple FDA pre-sub interactions have improved clarity on the post-surgical regulatory path.  There is significant potential for expanding indications to other ENT and non-ENT indication

The assets of BioInspire will be sold in whole or in part (collectively, the “BioInspire Assets”). The sale of these assets is being conducted with the cooperation of BioInspire.  BioInspire and its consultants will be available to assist purchasers with due diligence and a prompt, efficient transition to new ownership.

The Bidding Process for Interested Buyers

Interested and qualified parties will be expected to sign a nondisclosure agreement (attached hereto as Exhibit A) to have access to key members of the management and intellectual capital teams and the due diligence “war room” documentation (the “Due Diligence Access”).  Each interested party, as a consequence of the Due Diligence Access granted to it, shall be deemed to acknowledge and represent (i) that it is bound by the bidding procedures described herein; (ii) that it has an opportunity to inspect and examine the Igenica Assets and to review all pertinent documents and information with respect thereto; (iii) that it is not relying upon any written or oral statements, representations, or warranties of BioInspire Inc., Gerbsman Partners, or their respective staff, agents, or attorneys; and (iv) all such documents and reports have been provided solely for the convenience of the interested party, and neither BioInspire nor Gerbsman Partners (or their respective, staff, agents, or attorneys) makes any representations as to the accuracy or completeness of the same.  

Following an initial round of due diligence, interested parties will be invited to participate with a sealed bid, for the acquisition of the BioInspire Assets.  Sealed bids must be submitted so that the bid is actually received by Gerbsman Partners no later than Monday, April 22, 2019 at 3:00 p.m. Pacific Time (the “Bid Deadline”) at Igenica’s office, located at 863A Mitten Road Ste. 100B2, Burlingame, California 94010.  Please also email steve@gerbsmanpartners.com with any bid.

Bids should identify those assets being tendered for in a specific and identifiable way. 

Any person or other entity making a bid must be prepared to provide independent confirmation that they possess the financial resources to complete the purchase where applicable.  All bids must be accompanied by a refundable deposit check in the amount of $100,000 (payable to BioInspire, Inc.).  The winning bidder will be notified within 3 business days after the Bid Deadline.  Non-successful bidders will have their deposit returned to them.

BioInspire reserves the right to, in its sole discretion, accept or reject any bid, or withdraw any or all assets from sale.  Interested parties should understand that it is expected that the highest bid will be chosen as the winning bidder and bidders may not have the opportunity to improve their bids after submission. 

BioInspire will require the successful bidder to close within 7 business days.  Any or all of the assets of Igenica will be sold on an “as is, where is” basis, with no representation or warranties whatsoever.

All sales, transfer, and recording taxes, stamp taxes, or similar taxes, if any, relating to the sale of the BioInspire Assets shall be the sole responsibility of the successful bidder and shall be paid to BioInspire at the closing of each transaction.

 

For additional information, please see below and/or contact:

Steven R. Gerbsman                                                                                   

steve@gerbsmanpartners.com                                  

 

Kenneth Hardesty

ken@gerbsmanpartners.com

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The Bidding Process, Procedures for the Sale of certain Assets and Intellectual Property of TrueFacet. Inc

Further to Gerbsman Partners sales letter of February 20,2019 regarding the sale of certain assets of TrueFacet, Inc. (“TrueFacet”), I am attaching a link below for updated information power point regarding the Assets and Intellectual Property of TrueFacet for interested parties bidding on the assets and IP of TrueFacet and TrueFacet’s Data Room due diligence information list. 

Ken, Dennis and I will be following up to review the updated Bidding Process, schedule due diligence meetings and answer any questions regarding the “Date Certain M&A Process”.

I will be sending out a draft Asset Purchase Agreement “APA” in a couple of weeks prior to the bid date of March 22, 2019.

Any and all the assets of TrueFacet will be sold on an “as is, where is” basis and will be subject to “The Bidding Process for Interested Buyers”, outlined below.

Gerbsman Partners (http://www.gerbsmanpartners.com) has been retained by TrueFacet (https://www.truefacet.com) to solicit interest for the acquisition of part or substantially all of TrueFacet’s assets, including its Intellectual Property (“IP”), in whole or in part (collectively, the “TrueFacet Assets”).

 

IMPORTANT LEGAL NOTICE

The information in this memorandum does not constitute the whole or any part of an offer or a contract, nor does it purport to contain all information that may be required or relevant to a recipient’s evaluation of any transaction and recipients will be responsible for conducting their own investigations and analysis.

The information contained in this memorandum relating to the TrueFacet Assets has been supplied by TrueFacet. It has not been independently investigated or verified by Gerbsman Partners, its agents or any other party.

Potential purchasers should not rely on any information contained in this memorandum or provided by TrueFacet or Gerbsman Partners (or their respective staff, agents, and attorneys) in connection herewith, whether transmitted orally or in writing as a statement, opinion, or representation of fact. Interested parties should satisfy themselves through independent investigations as they or their legal and financial advisors see fit.

TrueFacet and Gerbsman Partners, and their respective staff, agents, and attorneys, (i) disclaim any and all implied warranties concerning the truth, accuracy, completeness and reasonableness of any information provided in connection herewith and (ii) do not accept liability for the information provided in connection herewith, including information contained in this memorandum, whether that liability arises by reasons of TrueFacet’s or Gerbsman Partners’ negligence or otherwise. 

Any sale of the TrueFacet Assets will be made on an “as-is, where-is,” and “with all faults” basis, without any warranties, representations, or guarantees, either express or implied, of any kind, nature, or type whatsoever from, or on behalf of TrueFacet and Gerbsman Partners. Without limiting the generality of the foregoing, TrueFacet and Gerbsman Partners and their respective staff, agents, and attorneys, hereby expressly disclaim any and all implied warranties concerning the condition of the TrueFacet Assets and any portions thereof, including, but not limited to, environmental conditions, compliance with any government regulations or requirements, the implied warranties of habitability, merchantability, or fitness for a particular purpose.

Except as otherwise noted, this memorandum speaks as of the date hereof.  The delivery of this memorandum should not and does not create any implication that there has been no change in the business and affairs of TrueFacet since such date.  Neither TrueFacet nor Gerbsman Partners, or their respective staff, agents and attorneys, undertakes any obligation to update any information contained herein.

This memorandum contains confidential information and is not to be supplied to any person without Gerbsman Partners’ prior consent. This memorandum and the information contained herein are subject to the non-disclosure agreement attached hereto as Exhibit A.

 

The Bidding Process for Interested Buyers

Interested and qualified parties will be required to sign a Non-Disclosure Agreement (attached hereto as Attachment A) to have access to key members of management and intellectual capital teams and the due diligence “war room” documentation (“Due Diligence Access”). Each interested party, as a consequence of the Due Diligence Access granted to it, shall be deemed to acknowledge and represent (i) that it acknowledges and agrees to the bidding procedures described herein; (ii) that it has had an opportunity to inspect and examine the TrueFacet Assets and to review all pertinent documents and information with respect thereto; (iii) that it is not relying upon any written or oral statements, representations, or warranties of TrueFacet or Gerbsman Partners, or their respective staff, agents, or attorneys; and (iv) all such documents and reports have been provided solely for the convenience of the interested party, and TrueFacet and Gerbsman Partners (and their respective staff, agents, or attorneys) do not make any representations as to the accuracy or completeness of the same.  

Following an initial round of due diligence, interested parties will be invited to participate with a sealed bid, for the acquisition of all or part of the TrueFacet Assets. Each sealed bid must be submitted so that it is received by the Company no later than Tuesday, March 22, 2019 at 3:00pm Eastern Daylight Time (the “Bid Deadline”) at TrueFacet’s office, located at 530 7th Avenue # 1502, New York, NY. 10018.  Please also email steve@gerbsmanpartners.com with any bid.  For additional information regarding bid requirements and considerations, please contact Steve Gerbsman at steve@gerbsmanpartners.com.

Any person or other entity making a bid must be prepared to provide independent confirmation that they possess the financial resources to complete the purchase.  All bids must be accompanied by a refundable deposit in the amount of $200,000 (payable to TrueFacet, Inc.).  The deposit should be wired to TrueFacet’s attorneys (information will be provided).  The winning bidder will be notified within 3 business days of the Bid Deadline. The deposit will be held in trust by TrueFacet counsel.  Unsuccessful bidders will have their deposit returned to them within 3 business days of notification that they are an unsuccessful bidder. 

TrueFacet is free to conduct the sale process as it determines in its sole discretion (including, without limitation, terminating further participation in the process by any party, negotiating with prospective purchasers and entering into an agreement with respect to a sale transaction without prior notice to you or any other person) and any procedures relating to such transaction may be changed at any time without prior notice to you or any other person.  For greater certainty, TrueFacet reserves the right to, in its sole discretion, accept or reject any bid, or withdraw any or all assets from sale.  Interested parties should understand that it is expected that the highest and best bid submitted will be chosen as the winning bidder and bidders may not have the opportunity to improve their bids after submission.  

TrueFacet will require the successful bidder to close within 7 business days from the Bid Deadline. Any or all of the assets of TrueFacet will be sold on an “as is, where is” basis, with no representation or warranties whatsoever.

All sales, transfer, and recording taxes, stamp taxes, or other taxes, if any, relating to the sale of the TrueFacet Assets shall be the sole responsibility of the successful bidder and shall be paid to TrueFacet at the closing of each transaction. 

For additional information, please see below and/or contact: 

Steven R. Gerbsman                                           

steve@gerbsmanpartners.com 

Ken Hardesty

ken@gerbsmanpartners.com 

 

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The Bidding Process, Procedures for the Sale of certain Assets and Intellectual Property of Neograft Technologies, Inc.

Further to Gerbsman Partners sales letter of January 29, 2019 and update of February 4, 2019 regarding the sale of certain assets of Neograft Technologies, Inc. (“Neograft”), I am attaching updated information regarding the Assets and Intellectual Property of Neograft for interested parties bidding on the assets and IP of Neograft;  Neograft’s Data Room due diligence information list and the Neograft Asset Purchase Agreement (“APA”) with detailed Asset List.

Prior to the bid date of February 28, 2019, I would encourage and recommend that all interested parties have their counsel speak with Jeff Quillen, Esq. or Erin Klein, Esq. of Foley Hoag, counsel to Neograft, to discuss any questions or comments of a legal nature relating to the transaction.   Jeff is available at 617 832 1205 jquillen@foleyhoag.com.  Erin is available at 617 832 1288 eklein@foleyhoag.com 

Please review the “Important Legal Notice” below in that potential purchasers should not rely on any information contained provided by Gerbsman Partners (or their respective staff, agents, and attorneys) in connection herewith, whether transmitted orally or in writing as a statement, opinion, or representation of fact.  Interested parties should satisfy themselves through independent investigations as they or their legal and financial advisors see fit. 

Ken, Dennis and I will be following up to review the updated Bidding Process, schedule due diligence meetings and answer any questions regarding the “Date Certain M&A Process”.

I will be sending out a draft Asset Purchase Agreement “APA” in a couple of weeks prior to the bid date of February 28, 2019.

Any and all the assets of Neograft will be sold on an “as is, where is” basis and will be subject to “The Bidding Process for Interested Buyers”, outlined below.

Gerbsman Partners (http://www.gerbsmanpartners.com) has been retained by Neograft (http://neograftinc.com) to solicit interest for the acquisition of part or substantially all of Neograft’s assets, including its Intellectual Property (“IP”), in whole or in part (collectively, the “Neograft Assets”).

 

IMPORTANT LEGAL NOTICE

The information in this memorandum does not constitute the whole or any part of an offer or a contract. 

The information contained in this memorandum relating to Neograft Assets has been supplied by Neograft. It has not been independently investigated or verified by Gerbsman Partners or their respective agents.

Potential purchasers should not rely on any information contained in this memorandum or provided by Neograft or Gerbsman Partners (or their respective staff, agents, and attorneys) in connection herewith, whether transmitted orally or in writing as a statement, opinion, or representation of fact. Interested parties should satisfy themselves through independent investigations as they or their legal and financial advisors see fit.

Neograft, Gerbsman Partners, and their respective staff, agents, and attorneys, (i) disclaim any and all implied warranties concerning the truth, accuracy, and completeness of any information provided in connection herewith and (ii) do not accept liability for the information, including that contained in this memorandum, whether that liability arises by reasons of Neograft’s or Gerbsman Partners’ negligence or otherwise. 

Any sale of the Neograft Assets will be made on an “as-is,” “where-is,” and “with all faults” basis, without any warranties, representations, or guarantees, either express or implied, of any kind, nature, or type whatsoever from, or on behalf of Neograft and Gerbsman Partners. Without limiting the generality of the foregoing, Neograft and Gerbsman Partners and their respective staff, agents, and attorneys, hereby expressly disclaim any and all implied warranties concerning the condition of the Neograft Assets and any portions thereof, including, but not limited to, environmental conditions, compliance with any government regulations or requirements, the implied warranties of habitability, merchantability, or fitness for a particular purpose.

This memorandum contains confidential information and is not to be supplied to any person without Gerbsman Partners’ prior consent. This memorandum and the information contained herein are subject to the non-disclosure agreement attached hereto as Exhibit A.

 

The Bidding Process for Interested Buyers

Interested and qualified parties will be expected to sign a Confidential Disclosure Agreement (attached hereto as Appendix A) to have access to key members of management and intellectual capital teams and the due diligence “war room” documentation (“Due Diligence Access”). Each interested party, as a consequence of the Due Diligence Access granted to it, shall be deemed to acknowledge and represent (i) that it is bound by the bidding procedures described herein; (ii) that it has had an opportunity to inspect and examine the Neograft Assets and to review all pertinent documents and information with respect thereto; (iii) that it is not relying upon any written or oral statements, representations, or warranties of Neograft, Gerbsman Partners, or their respective staff, agents, or attorneys; and (iv) all such documents and reports have been provided solely for the convenience of the interested party, and Gerbsman Partners (and their respective staff, agents, or attorneys) do not make any representations as to the accuracy or completeness of the same.  

Following an initial round of due diligence, interested parties will be invited to participate with a sealed bid, for the acquisition of the Neograft Assets. Each sealed bid must be submitted so that it is received by Gerbsman Partners no later than February 28, 2019 at 6pm Eastern Standard Time (the “Bid Deadline”) at Neograft’s offices, located at 470 Constitution Drive, Taunton, MA 02780.  Please also email steve@gerbsmanpartners.com with any bid.

Bids should identify those assets being tendered for in an identifiable way. 

Any person or other entity making a bid must be prepared to provide independent confirmation that they possess the financial resources to complete the purchase.  All bids must be accompanied by a refundable deposit in the amount of $200,000.  The deposit should be wired to an escrow agent who will be outlined in a future update.  The winning bidder will be notified within 3 business days of the Bid Deadline.  Unsuccessful bidders will have their deposit returned to them within 3 business days of notification that they are an unsuccessful bidder.  

Neograft reserves the right to, in its sole discretion, accept or reject any bid, or withdraw any or all assets from sale.  Interested parties should understand that it is expected that the highest and best bid submitted will be chosen as the winning bidder and bidders may not have the opportunity to improve their bids after submission.  

Neograft will require the successful bidder to close within a 7 day period. Any or all of the assets of Neograft will be sold on an “as is, where is” basis, with no representation or warranties whatsoever.

All sales, transfer, and recording taxes, stamp taxes, or similar taxes, if any, relating to the sale of the Neograft Assets shall be the sole responsibility of the successful bidder and shall be paid to Neograft at the closing of each transaction.

For additional information, please see below and/or contact:

Steven R. Gerbsman                                                                                                     

steve@gerbsmanpartners.com                  

Kenneth Hardesty

ken@gerbsmanpartners.com

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SALE OF NEOGRAFT TECHNOLOGIES, INC.

Gerbsman Partners (www.gerbsmanpartners.com) has been retained by Neograft Technologies, Inc. (www.neograftinc.com) to solicit interest for the acquisition of all, or substantially all, the assets of Neograft Technologies, Inc.

Neograft is a privately held medical device company located in Taunton, MA, founded in April 2009.  Neograft is developing a novel, regenerative vascular graft based on its core electrospinning technology. The acquisition of Neograft Technologies will secure critical intellectual property and a substantial database characterizing safety and performance for its products that address a $2 Billion worldwide market opportunity. Neograft Technologies has raised three rounds (some with multiple tranches) of private financing to date totaling $40 million from private investors, a large majority from a single family fund together with other high net-worth individuals.

Neograft Technologies is developing a proprietary vascular graft that promises to improve clinical outcomes, especially in smaller vessels.  Its product is designed to become incorporated in the patient’s own tissue and then remodels over time to resemble and function as a native artery. Neograft Technologies has 25 issued US patents, 4 “Notices of Allowance”, 29 pending patent applications worldwide, and two pending trademarks.

Our core technology was first investigated as a reinforcement for saphenous vein CABG grafts, and is based partly on patents licensed from the University of Pittsburgh.  This product was evaluated in two clinical feasibility studies in 42 subjects. The results showed encouraging signs of diminished midgraft stenosis and distal anastomotic hyperplasia, but there was a limiting response at the proximal anastomosis.

The regenerative graft is based on the same core technology and has been evaluated in several animal studies.  The latest data shows encouraging signs that a similar remodeling behavior can occur using a synthetic implant.

IMPORTANT LEGAL NOTICE:

The information in this memorandum does not constitute the whole or any part of an offer or a contract. 

The information contained in this memorandum relating to Neograft Technologies’s Assets has been supplied by Neograft Technologies. It has not been independently investigated or verified by Gerbsman Partners or its agents.

Potential purchasers should not rely on any information contained in this memorandum or provided by Neograft Technologies, or Gerbsman Partners (or their respective staff, agents, and attorneys) in connection herewith, whether transmitted orally or in writing as a statement, opinion, or representation of fact. Interested parties should satisfy themselves through independent investigations as they or their legal and financial advisors see fit.

Neograft Technologies, Gerbsman Partners, and their respective staff, agents, and attorneys, (i) disclaim any and all implied warranties concerning the truth, accuracy, and completeness of any information provided in connection herewith and (ii) do not accept liability for the information, including that contained in this memorandum, whether that liability arises by reasons of Neograft Technologies’s or Gerbsman Partners’ negligence or otherwise.

Any sale of the Neograft Technologies Assets will be made on an “as-is,” “where-is,” and “with all faults” basis, without any warranties, representations, or guarantees, either express or implied, of any kind, nature, or type whatsoever from, or on behalf of Neograft Technologies or Gerbsman Partners. Without limiting the generality of the foregoing, Neograft Technologies and Gerbsman Partners and their respective staff, agents, and attorneys, hereby expressly disclaim any and all implied warranties concerning the condition of the Neograft Technologies Assets and any portions thereof,including,but not limited to, environmental conditions, compliance with any government regulations or requirements, the implied warranties of habitability, merchantability, or fitness for a particular purpose.

This memorandum contains confidential information and is not to be supplied to any person without Gerbsman Partners’ prior consent. This memorandum and the information contained herein are subject to the non-disclosure agreement attached hereto as Exhibit A.

Historical Company Information

Neograft Technologies was established in 2009 to focus on core technology developed at and licensed from The University of Pittsburgh that focused on saphenous vein reinforcement. The company was located in Pittsburgh for the first two years before relocating to Taunton, MA.

For the first five years, the company focused exclusively on applying its core electrospinning technology on developing an intraoperative system to coat the outside surface of saphenous vein grafts to improve CABG outcomes.

In parallel, the company established an aggressive patent strategy and has created broad patent protection around this concept.  In 2015, the company acquired the intellectual property assets of Kips Bay Medical, Inc., a public, Minnesota based company that developed a product for the same CABG indication.  Together, the IP of both companies establishes a significant barrier to competition in this market.

Two clinical feasibility studies were conducted in Eastern Europe to evaluate the CABG indication with encouraging signs of attenuated mid-graft and distal disease.  However, there was a significant incidence of stenosis at the proximal connection to the aorta.

During the course of extensive experiments in animals (over 200 implants for as long as two years) Neograft discovered that its product facilitated transformation of developing tissue surrounding the product into a structure that resembles a native blood vessel.  Based on this discovery, the company decided to refocus its attention on applying the technology as a stand-alone synthetic graft.  Much of the core IP developed for the CABG indication overlaps this indication and the company has filed new patent applications that directly cover any new inventions.

Significant progress has occurred toward a clinically usable product and recent animal testing shows encouraging signs that similar remodeling of the polymer structure is feasible.

Neograft Technologies believes this technology provides a potential and sustainable commercial asset in the vascular graft market for the following reasons:

  1. The US market for peripheral, hemodialysis and coronary bypass grafts is very large and growing. Market growth via displacement of native grafts will occur with a clinically superior product. Surgeons will rapidly adopt as it eliminates the need to harvest pains.
  2. Peripheral graft failures are as high as 60% at one to three years and outcomes haven’t improved significantly over the past forty years, despite many attempts at a solution to this problem.
  3. The mechanism of action of this product is similar to several, more-complex bioengineered approaches but can be achieved through simpler and lower-costmanufacturing.
  4. Currently available heparin coated grafts are priced at 4X uncoated grafts in the US, though there is no significant difference in outcomes. A truly better product will create significant opportunity to grow revenue through increased value.
  5. The mechanism of action for the product has been demonstrated in animals, with over 200 implants followed as long as two years. The safety of the material and technology has also been demonstrated in humans, in two separate studies enrolling 42 subjects.
  6. The company has established a vertically integrated, very efficient operation, that is ISO 13485-2016 certified for producing the product.
  7. The company has established a reliable, working animal model for verifying performance of the product and also a very efficient pathway for verifying clinical performance in humans so final development steps are far more economical than typical products of this type.
  8. 25 issued US patents, 33 issued patents outside of US, 4 Notices of Allowance received, 12 US applications pending, and 17 applications pending outside of US.

Neograft Technologies Company Profile- Assets of the Company

Neograft Technologies was founded by an expert group of scientists and experienced industry executives to develop and commercialize its novel technology to improve CABG outcomes.

The company has assembled a world-class clinical and scientific advisory board and has created a compact but fully vertical operational capability to develop, test and manufacture its products.  It has also established clinical relationships within and outside of the US to effeciently evaluate its products.

Neograft opportunistically acquired the intellectual property assets and data of Kips Bay Medical, a public Minnesota based company that developed a different external reinforcement device for improving CABG outcomes that was incubated at Medtronic until its spin-off in 2007.

 

Product development and testing has all been conducted within the scope of ISO-13485 and the company is currently certified to ISO-13485 2016.

 

An extensive database exists characterizing safety and performance in-vitro, in animals and in humans.

Impact of Technology on the Market

This technology enables a novel approach to one of the remaining ‘holy grails’ in the medical world of a durable, small-diameter vascular graft. This is enabled by a surprising discovery that the company’s material provides temporary support, to allow tissue to penetrate and develop within a porous polymer matrix, but then disrupts without significant inflammation to allow environmental conditioning.

It has been shown that pulsatile pressure triggers constructive remodeling, which results in transformation of developing tissues into structures that resemble natural blood vessels. This transformation will lead to a stable, self-supportive structure that will behave like a native blood vessel.

Other tissue-engineered approaches to this problem show promise in clinical tests but are produced using very complex and inherently expensive processes.  Neograft’s technology functions via a similar mechanism of action but is much simpler and more economical to produce, so it will have comparable outcomes to these more complex product but capable to outpace them economically.

Neograft Technology’s Assets

Neograft has developed a portfolio of assets that are critical to developing, producing or marketing its proprietary regenerative vascular graft or similar constructs. In addition, our intellectual property related to venous reinforcement has significant potential as a barrier to competitive activity in this area. Our assets comprise:

  1. Patents, Patent Applications and Trademarks
  2.  Significant intellectual capital, know-how and expertise in the development and testing of vascularimplants.
  3. An extensive database of in vitro and in vivo testing, including over thirty animal implantexperiments, on over 200 implants for up to 2 years.
  4. Clinical data from two clinical feasibility studies, one publication, and two manuscripts.
  5. Fixed assets of approximately $200,000 including a 500 square foot portable cleanroom, multiple chemical fume hoods, two viscometers, two tensile testers, a portable SEM with vapor and sputter coating system, GPC system, UV and IR spectrophotometer, numerous vacuum and environmental ovens, multiple autoclave systems, large variety of standard and specialty chemical glassware, a high density slide scanner, a variety of optical microscopes and camera systems, a specialty machine shop, a large number of handheld measurement tools and instruments.

The assets of Neograft Technologies will be sold in whole or in part (collectively, the “Neograft Technologies Assets”). The sale of these assets is being conducted with the cooperation of Neograft Technologies. Neograft Technologies and its consultants will be available to assist purchasers with due diligence and a prompt, efficient transition to new ownership.

Neograft Technologies, Inc. Key Personnel

Jon McGrath — President and CEO/Board Member: Jon has led the company since 2011. Prior to Neograft, Jon was CEO of LumeRx, a venture-backed gastroenterology startup,VP of R&D and Operations at Biosphere Medical(acquired by Merrit Medical);VP of R&D and Operations at Urologix (ULGX), and VP of R&D at Pfizer/Schneider (acquired by Boston Scientific). He cofounded Harbor Medical (acquired by Teleflex) and held several positions of increasing responsibility at Medi Tech (now BostonScientific).

Mohammed El-Kurdi— Chief Technology Officer: Dr. El-Kurdi co-founded the company in 2009. He has been focused on bioengineering arterial vein grafts since 2000, beginning shortly after he joined a cardiovascular research team at the University of Pittsburgh’s McGowan Institute for Regenerative Medicine. His PhD work focused on Neograft’s core technology that formed the foundation of the company and  its central intellectual property. This work also resulted in the first peer reviewed publication of the product. Several generations later, the company has evolved a product that delivers on the promise of his early research to produce a stable and self-supporting arterial veingraft

Neograft Technologies, Inc. Board of Directors

Christopher S. Petersen, Chairman of the Board– Chris is president of RePetersen Enterprises, LLC., is Board Chairman at WeSpeke, Inc, and also serves on the Board of Directors for Medrobotics and Rinovum.  Earlier professional experience includes KPMG, LLP and ThyssenKrupp, where he was Assistant Corporate Controller.

Jon McGrath, President and Chief Executive Officer- Earlier, Jon was CEO of LumeRx, VP of R&D and Operations at Biosphere Medical; VP of R&D and Operations at Urologix, and VP of R&D at Pfizer/Schneider. He cofounded Harbor Medical (acquired by Teleflex) and held several positions of increasing responsibility at Medi Tech (now Boston Scientific).

Thomas M. Dugan, MD- Tom is a retired cardiologist and a former president of a large cardiology and cardiovascular surgery private practice group in Erie, PA.  He trained at Duke University, Georgetown University and the University of Pittsburgh.  He is currently on the Board of Medrobotics.

Brad R. Petersen, PhD- Brad is currently a Pharmacy Operations Manager at Ohio Health’s Grant Medical Center. He is also on the Board of WeSpeke, Rinovum and Medrobotics.

Richard C. Petersen Jr.- Mr. Petersen is founder and President of Petersen Jr. Enterprises. He spent 32 years with GM/DELPHI, retiring as General Director of Corporate Planning for Delphi-Steering.  He is also the Chairman of the Board for Rinovum Women’s Health LLC, and WeSpeke. He is a Director for a number of other entities that vary based on investments from time to time.

Michael Tovian- Michael (“Mike”) Tovian is Executive Consultant of Dosepoint LLC. Previously, he was President and CEO of Harmony Pharmacy and Health Center, served as Managing Director of Healthios Global, Inc., and spent 28-years prior to that with Walgreen Drug Stores, Inc, including as Vice President of Managed Care Sales and Contracting.

The Bidding Process for Interested Buyers

Interested and qualified parties will be expected to sign a non disclosure agreement (attached hereto as Exhibit A) to have access to key members of the management and intellectual capital teams and the due diligence “war room” documentation (the “Due Diligence Access”). Each interested party, as a consequence of the Due Diligence access granted to it, shall be deemed to acknowledge and represent (i) that it is bound by the bidding procedures described herein; (ii) that it has an opportunity to inspect and examine the Neograft Technologies Assets and to review all pertinent documents and information with respect thereto; (iii) that it is not relying upon any written or oral statements, representations, or warranties of Neograft Technologies, Inc., Gerbsman Partners, or their respective staff, agents, or attorneys; and (iv) all such documents and reports have been provided solely for the convenience of the interested party, and neither Neograft Technologies nor Gerbsman Partners (or their respective, staff, agents, or attorneys) makes any representations as to the accuracy or completeness of the same.

Following an initial round of due diligence, interested parties will be invited to participate with a sealed bid, for the acquisition of the Neograft Technologies Assets. Sealed bids must be submitted so that the bid is actually received by Gerbsman Partners no later than February 28 at 6:00 pm Eastern Standard Time (the “Bid Deadline”) at Neograft Technologies’s office, located at 470 Constitution Dr., Taunton, MA 02780. Please also email steve@gerbsmanpartners.com with any bid.

Bids should identify those assets being tendered for in a specific and identifiable way. The attached Neograft Technologies fixed asset list may not be complete and Bidders interested in the Neograft Technologies’s Assets must submit a separate bid for such assets. Be specific as to the assetsdesired.

Any person or other entity making a bid must be prepared to provide independent confirmation that they possess the financial resources to complete the purchase where applicable. All bids must be accompanied by a refundable deposit check in the amount of $200,000 (payable to Neograft Technologies, Inc.).  The winning bidder will be notified within 3 business days after the Bid Deadline.  Non-successful bidder will have their deposit returned to them.

Neograft Technologies reserves the right to, in its sole discretion, to accept or reject any bid or withdraw any or all assets from sale. Interested parties should understand that it is expected that the highest bid will be chosen as the winning bidder and bidders may not have the opportunity to improve their bids after submission.

Neograft Technologies will require the successful bidder to close within 7 business days. Any or all of the assets of Neograft Technologies will be sold on an “as is, where is” basis, with no representation or warranties whatsoever.

All sales, transfer and recording taxes, stamp taxes, or similar taxes, if any relating to the sale of the Neograft Technology Assets shall be the sole responsibility of the successful bidder and shall be paid to Neograft Technologies at the closing of each transaction.

For additional information, please see below and/or contact:

 

Steven R. Gerbsman

steve@gerbsmanpartners.com

Kenneth Hardesty

ken@gerbsmanpartners.com

 

 

 

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The Bidding Process, Procedures for the Sale of certain Assets and Intellectual Property of Cibiem, Inc.

Further to Gerbsman Partners sales letter of August 16, 2018, Update on August 25, 2018 and September 4, 2918 regarding the sale of certain assets of Cibiem, Inc., (“Cibiem”), I am attaching a draft Asset Purchase Agreement (“APA”), as well as the “Table of Contents and Outline” for the Cibiem Data Room.

Prior to the bid date of September 21, 2018, I would encourage and recommend that all interested parties have their counsel speak with Stephen O’Neill, Esq. of Dorsey, counsel to Cibiem, to review and finalize the “APA”.  He is available to discuss any questions or comments of a legal nature relating to the transactions contemplated by the APA.  Steve is available at oneill.stephen@dorsey.com and cell 650 843 2719.

Please review the “Important Legal Notice” below in that potential purchasers should not rely on any information contained provided by Gerbsman Partners (or their respective staff, agents, and attorneys) in connection herewith, whether transmitted orally or in writing as a statement, opinion, or representation of fact.  Interested parties should satisfy themselves through independent investigations as they or their legal and financial advisors see fit. 

Ken, Dennis and I will be following up to review the Bidding Process, schedule due diligence meetings and answer any questions regarding the “Date Certain M&A Process”.

Gerbsman Partners (http://www.gerbsmanpartners.com) has been retained by Cibiem, inc., (http://cibiem.com) to solicit interest for the acquisition of all or substantially all of Cibiem’s assets, including its Intellectual Property (“IP”), in whole or in part (collectively, the “Cibiem Assets”).  

Any and all the assets of Cibiem will be sold on an “as is, where is” basis and will be subject to “The Bidding Process for Interested Buyers”, outlined below.

 

IMPORTANT LEGAL NOTICE:

The information in this memorandum does not constitute the whole or any part of an offer or a contract.

The information contained in this memorandum relating to Cibiem’s Assets has been supplied by Cibiem.  It has not been independently investigated or verified by Gerbsman Partners or its agents.Potential purchasers should not rely on any information contained in this memorandum or provided by Cibiem, or Gerbsman Partners (or their respective staff, agents, and attorneys) in connection herewith, whether transmitted orally or in writing as a statement, opinion, or representation of fact. Interested parties should satisfy themselves through independent investigations as they or their legal and financial advisors see fit.

Cibiem, Gerbsman Partners, and their respective staff, agents, and attorneys, (i) disclaim any and all implied warranties concerning the truth, accuracy, and completeness of any information provided in connection herewith and (ii) do not accept liability for the information, including that contained in this memorandum, whether that liability arises by reasons of Cibiem’s or Gerbsman Partners’ negligence or otherwise.

Any sale of the Cibiem Assets will be made on an “as-is,” “where-is,” and “with all faults” basis, without any warranties, representations, or guarantees, either express or implied, of any kind, nature, or type whatsoever from, or on behalf of Cibiem or Gerbsman Partners.  Without limiting the generality of the foregoing, Cibiem and Gerbsman Partners and their respective staff, agents, and attorneys, hereby expressly disclaim any and all implied warranties concerning the condition of the Cibiem Assets and any portions thereof, including, but not limited to, environmental conditions, compliance with any government regulations or requirements, the implied warranties of habitability, merchantability, or fitness for a particular purpose.

This memorandum contains confidential information and is not to be supplied to any person without Gerbsman Partners’ prior consent.  This memorandum and the information contained herein are subject to the non-disclosure agreement attached hereto as Exhibit A.

 

The Bidding Process for Interested Buyers

Interested and qualified parties will be expected to sign a nondisclosure agreement (attached hereto as Exhibit A) to have access to key members of the management and intellectual capital teams and the due diligence “war room” documentation (the “Due Diligence Access”).  Each interested party, as a consequence of the Due Diligence Access granted to it, shall be deemed to acknowledge and represent (i) that it is bound by the bidding procedures described herein; (ii) that it has an opportunity to inspect and examine the Cibiem Assets and to review all pertinent documents and information with respect thereto; (iii) that it is not relying upon any written or oral statements, representations, or warranties of Cibiem, Inc., Gerbsman Partners, or their respective staff, agents, or attorneys; and (iv) all such documents and reports have been provided solely for the convenience of the interested party, and neither Cibiem nor Gerbsman Partners (or their respective, staff, agents, or attorneys) makes any representations as to the accuracy or completeness of the same. 

Following an initial round of due diligence, interested parties will be invited to participate with a sealed bid, for the acquisition of the Cibiem Assets.  Sealed bids must be submitted so that the bid is actually received by Gerbsman Partners no later than Friday, September 21, 2018 at 3:00 p.m. Pacific Time (the “Bid Deadline”) at Gerbsman Partners office.  Please also email steve@gerbsmanpartners.com with any bid.

Bids should identify those assets being tendered for in a specific and identifiable way.  The attached Cibiem fixed asset list may not be complete and Bidders interested in the Cibiem’s Assets must submit a separate bid for such assets.  Be specific as to the assets desired.

Any person or other entity making a bid must be prepared to provide independent confirmation that they possess the financial resources to complete the purchase where applicable.  All bids must be accompanied by a refundable deposit check in the amount of $200,000 (wire transfer information will be supplied at a later date).  The winning bidder will be notified within 3 business days after the Bid Deadline.  Non-successful bidders will have their deposit returned to them.

Cibiem reserves the right to, in its sole discretion, accept or reject any bid, or withdraw any or all assets from sale.  Interested parties should understand that it is expected that the highest bid will be chosen as the winning bidder and bidders may not have the opportunity to improve their bids after submission.

Cibiem will require the successful bidder to close within 7 business days.  Any or all of the assets of Cibiem will be sold on an “as is, where is” basis, with no representation or warranties whatsoever.

All sales, transfer, and recording taxes, stamp taxes, or similar taxes, if any, relating to the sale of the Cibiem Assets shall be the sole responsibility of the successful bidder and shall be paid to Cibiem at the closing of each transaction.

For additional information, please see below and/or contact:

Steven R. Gerbsman

steve@gerbsmanpartners.com

Dennis Sholl

dennis@gerbsmanpartners.com

Kenneth Hardesty

ken@gerbsmanpartners.com

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