CryoLife Inc. has sold its HeRO Graft product line to Merit Medical Systems Inc. for $18.5 million in cash. In January CryoLife acquired On-X Life Technologies, a privately held mechanical heart valve company.
“The transaction more than doubled our U.S. cardiac surgery sales force,” said J. Patrick Mackin, chairman, president, and CEO of CryoLife. “The sale of the HeRO Graft product line will allow our commercial organization to have a greater focus on selling our expanded portfolio of cardiac surgery products.”
Under terms of the agreement, Merit acquired the HeRO Graft product line, including worldwide marketing rights, customer relationships, intellectual property, equipment, and inventory. CryoLife will continue to manufacture the HeRO Graft for up to six months under a transition supply agreement, after which Merit will be responsible for manufacturing. CryoLife’s HeRO Graft revenue was $7.5 million in 2015.
“We believe this transaction represents a positive opportunity for both companies,” said Mackin. “The HeRO Graft is a unique product within the dialysis continuum of care and it is proven to reduce bacteremia rates by 69% as compared to patients with tunneled dialysis catheters. Merit has a complementary portfolio of vascular access and dialysis related products, with corresponding customer relationships, putting them in a strong position to broaden HeRO Graft access for patients with end-stage renal disease.”