BASEL, Switzerland – Medartis, a Switzerland-based orthopedic company for head and extremity surgery, announced plans to acquire Nextremity Solutions Inc., a strategic commercialization organization (SCO) focused on the musculoskeletal space extremities, located in Warsaw.

Founded in 2007, the privately held Nextremity Solutions Inc. (NSI) “is a highly regarded American medical technology company that specializes in the design, development and manufacture of indication-specific technologies for the treatment of fractures and lower and upper limb deformities,” according to a Nextremity press release. “NSI is an excellent strategic fit for Medartis, creating significant new growth opportunities in the US extremities market. According to external market research, the $2 billion US foot and ankle market is one of the fastest growing orthopedic industries due to new treatment concepts and demographic trends. Through this acquisition, Medartis has access to a highly dedicated and experienced R&D team, strong relationships with US designer surgeons and industry thought leaders, a portfolio of complementary products, a proprietary portfolio intellectual property, product knowledge and a modern regional manufacturing base.

With this acquisition, Medartis will be able to accelerate and expand its current expansion plans in the United States and sees this transaction as a catalyst for its extremities business in the United States and possibly elsewhere, says the press release. To fully exploit the growth potential, Medartis US will significantly expand its distribution network and its training and education offering. Its North American research and development center will be based in Warsaw, where NSI is located.

NSI has built a brand new manufacturing facility for instruments and implants. The modern 69,500 square foot production area is expandable and will be used to meet regional market needs. This will enhance the company’s natural currency hedging and provide design transfer opportunities.

Christoph Brönnimann, CEO of Medartis, said, “In the US, we have strengthened our commercial distribution and invested in training and education capabilities. The acquisition of Nextremity Solutions is an excellent strategic and cultural complement. The new R&D center and modern manufacturing facility in the United States will be a catalyst to accelerate our endpoints business in the United States and potentially elsewhere. I am delighted that CEO Rod K. Mayer and his management team will remain with the company, complementing our local management team and working with us to grow our business in the United States.

Nextremity Solutions CEO Rod K. Mayer, who has worked in the field of orthopedics for more than 40 years, said, “This partnership is an exciting opportunity to jointly develop and market patient-centric solutions. Medartis enjoys an excellent reputation among American upper extremity surgeons. By pooling our resources, we will make our current solutions available to more physicians and introduce new innovations to improve treatment options. We are delighted to join a company that shares similar values ​​to ours. We are both innovation and precision driven, work extensively with designer surgeons and are committed to patient well-being.

The first products with high sales potential are expected to be launched in early 2023. The total purchase price will be US$70 million. In addition to an upfront cash payment of US$40 million at closing, the purchase agreement includes milestone and earn-out payments of up to US$30 million related to the timing of product launches and completion certain sales targets. The transaction is expected to close in the first half of 2022. This shared risk profile will allow Medartis to invest significant additional amounts in a dedicated foot and ankle franchise that will be built over the next three years. Financing for the acquisition may be funded from existing cash and future cash flows. Other financing options are also being explored, according to the press release.