Spectranetics to acquire California-based AngioScore for $230M

By: InnovatioNews Thursday May 29, 2014 1 comments Tags: AngioScore, Colorado Springs, Scott Drake, Spectranetics

COLORADO SPRINGS - Spectranetics Corp. (NASDAQ: SPNC) announced it has entered into a definitive merger agreement in which the company will acquire Freemont, Calif.-based AngioScore Inc., a leading developer, manufacturer and marketer of cardiovascular specialty balloons.

The agreement calls for a $230 million up-front payment along with additional contingent commercial and regulatory milestone payments.

The transaction is expected to benefit Spectranetics by expanding the company's addressable markets, broaden its product pipeline, enhance and leverage Spectranetics' strong sales and marketing capabilities and drive significant operating efficiencies and cost savings.

"We have consistently discussed our strict criteria in evaluating partnering opportunities," said Scott Drake, Spectranetics president and CEO.

"AngioScore meets our criteria with an exceptional strategic fit, leveragable call points, differentiated technology and clear operating efficiencies. As a combined entity, we expect to have a meaningfully expanded market opportunity and a compelling product portfolio."

The transaction is expected to close on or about June 30, when AngioScore will become a wholly-owned subsidiary of Spectranetics.
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FOR IMMEDIATE RELEASE July 1, 2014

SPECTRANETICS SUED FOR FRAUD

Spectranetics Corp., a U.S. producer of lasers and related products that clear blockages in arteries and are used for other similar clinical purposes, was sued July 1, in the Utrecht, Netherlands District Court for over $9 million for fraud in connection with a patent royalty license agreement which covers essentially all laser- related products the company manufactures and sells worldwide.

The Colorado Springs, Colorado- based medical device maker and its Dutch unit allegedly owes upwards of $9 million for royalties, interest and violations of other contractual rights to Dr. Wolfram Volckers, a German physician, who currently owns the rights to the patent license agreement.

The lawsuit says Spectranetics grossly underpaid and deceived for a decade a Volckers' predecessor, Interlase Limited Partnership, which had licensed the patented technology to the Colorado company. Spectranetics was sued over this same licensing agreement in 1995, 1998, and in 2002 and paid around $1.5M to the then licensors. It is further claimed that in not paying these royalties annually for many years, the company has artificially inflated its bottom line to the public and to its customers and the smaller losses shown in public filings would actually have been substantially greater otherwise.

Spectranetics recently completed approximately a $230M public offering of new senior convertible debentures by which they raised money for one of their subsidiaries to merge with a manufacturer of balloon vascular interventional catheters, Angioscore of California, USA, now a competing technology to that of Spectranetics' laser technologies products. The offering prospectus filed May 27, 2014 with the SEC in the United States does not mention this Volckers liability to the investor public nor to their customer base, nor have they set aside funds for these patent royalty liabilities. The offering/acquisition was/is to be backed by presumably artificially elevated share prices accordingly.

In separate matters, Spectranetics paid at least five other licensors of patented technology also used by the company undisclosed millions of dollars following a slew of lawsuits against Spectranetics over the past 15 years. Former Spectranetics Chief Executive John Schulte was convicted in 2008 by a U.S. federal court for lying to U.S. federal investigators during criminal probes against Spectranetics involving SEC, FDA, US Customs, US Pension and Guaranty Board and other U.S. agency violations. The company paid the government at least $5 million in penalties in those matters. The company has also paid nearly $10 million to its shareholders who filed several class action claims against it for deceptive financial practices, this too within the past five years. Spectranetics was also found guilty of FINRA violations.

Spectranetics' NASDAQ symbol is SPNC.

Contact: Sue Fielding/ AILST at [email protected]

- sue fielding