Dive Brief:
- Smith & Nephew has agreed to buy sports medicine business Integrity Orthopaedics for $225 million upfront to expand its shoulder repair offering.
- The takeover, which was disclosed Monday, will give Smith & Nephew a rotator cuff repair, or RCR, system designed to reduce re-tear rates and improve patient outcomes.
- Smith & Nephew values the RCR market at $875 million and has strengthened its presence in the sector in recent years, including by acquiring another company set up by Integrity’s founder.
Dive Insight:
Smith & Nephew bought Rotation Medical for an initial $125 million in 2017 to acquire a tissue regeneration technology for shoulder rotator cuff repair. Tom Westling, co-founder at Rotation, joined Smith & Nephew under the deal. After leaving Smith & Nephew, Westling founded Integrity in 2020 and took up the CEO post.
Integrity received 510(k) clearance for Tendon Seam in 2023. Physicians use the system to reattach soft tissue to bone in orthopedic surgical procedures. Similar devices including Smith & Nephew’s Suturefix Ultra, Conmed’s Y-Knot, Stryker’s Iconix and Zimmer Biomet’s JuggerKnot target the same patients. Yet Integrity saw areas for improvement over incumbent devices.
Compared to traditional repair, Tendon Seam is stronger and more stable because of its use of a single stitch and micro‑anchors, according to Integrity. Smith & Nephew has identified the design as a way to reduce the failure rate in RCR, which has also shaped the company’s positioning of the biologic implant it acquired from Rotation.
Westling said in a statement that early Tendon Seam results “indicate reduced pain, shorter sling times and low retear/failure rates.” The Integrity CEO said Smith & Nephew’s track record of launching devices, which he saw firsthand after joining the company in 2017, gives him confidence that Tendon Seam can become the standard of care.
With Tendon Seam at an early stage of commercialization, the acquisition fits with the strategy Smith & Nephew shared at an investor event in December. Smith & Nephew CEO Deepak Nath said the company has succeeded when deals have enabled it “to add value by deploying significant expertise in coding and reimbursement and medical education to accelerate new product routes to market.”
The success of Smith & Nephew’s application of those capabilities to Tendon Seam will affect the final value of the Integrity acquisition. Smith & Nephew will make up to $225 million in performance-based payments over the next five years. The company expects to close the deal this month.
