FDA Approves CartiHeal, Bioventus Buys Company For $315mm

On March 30, 2022, Israel-based CartiHeal Ltd, announced FDA PMA (premarket approval) for its Agili-C implant for treating knee joint surface lesions.

Five days later, April 4, Durham, North Carolina-based Bioventus announced plans to buy CartiHeal for about $315 million, excluding a stake already owned after Bioventus made a $50 million escrow payment last year. Bioventus may pay up to $135 million more if CartiHeal is able to hit $100 million in trailing 12-month sales. Bioventus plans to finance the acquisition with debt.

CartiHeal was granted FDA breakthrough designation for the implant in 2020 and received CE mark in 2011. It has not been recalled in any country for any reason.

It took the agency about six months to grant the approval. Ortho device approvals are rare. We counted this as only the second ortho PMA of the year.

The Agili-C

FDA documents describe the device as an “for articular osteochondral repair in arthritic and non-arthritic joints.” The PMA indication covers the treatment of “an International Cartilage Repair Society (ICRS) grade III or above knee-joint surface lesion(s), with a total treatable area of 1-7cm2, without severe osteoarthritis (Kellgren-Lawrence grade 0-3).”

Click here for the FDA summary of Safety and Effectiveness Data document.

The implant, according to the FDA document, is a “porous, biocompatible, and biodegradable bi-phasic scaffold, consisting of interconnected natural inorganic calcium carbonate (aragonite) derived from purified, inorganic coral exoskeleton.”

The Evidence

The Agili-C has been studied in four clinical trials, including three studies conducted outside of the U.S. (OUS) and a pivotal study. The PMA approval came after results from the two-year investigational device exemption (IDE) pivotal study confirmed the superiority of the implant compared to microfracture and debridement, the current standard of care.

Patients were treated between 2017 and 2019. The database for the PMA included data collected through September 2021 and included 251 patients. There were 27 investigational sites, 11 in the U.S. and 16 OUS.

The patient population was “heterogeneous, involving different kinds of joint surface lesions: focal cartilage lesions, osteochondral defects and mild to moderate osteoarthritis, including multiple defects.”

Conclusion

Those studies showed the implant “demonstrated superiority in the Primary Endpoint KOOS Overall Score [Knee Injury and Osteoarthritis Outcome Score].”

Safety results demonstrated a favorable safety profile compared to the standard of care.

Performance result showed both “statistically significant and clinically meaningful across all KOOS endpoints,” and demonstrated “superiority in the Primary Endpoint KOOS Overall Score at 24 months relative to SSOC”

The agency stated the data supported conclusion that “the probable benefits outweigh the probable risks,” and the probable benefits include “significant improvements in pain and function.”

This PMA didn’t go to the Orthopedic and Rehabilitation Devices Panel because the information in the PMA substantially duplicated information already seen by the panel.

Market Opportunity

The company says it expects the implant to be a cost-effective solution for cartilage regeneration and bone remodeling designed to delay total knee replacement in patients with joint surface lesions of the knee.

Bioventus CEO Ken Reali said in a previous news release that, “CartiHeal addresses an unmet need in joint preservation and cartilage regeneration for approximately 675,000 U.S. patients annually, representing an estimated $1.3 billion market opportunity for Bioventus.”

A limited market release of the device in the U.S. is planned for the third quarter of 2022.