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Teleflex Inc. entered into an agreement on Wednesday to acquire privately held Palette Life Sciences AB in a deal valued at up to $650 million.
The deal, which requires regulatory approval and is expected to close in December, will expand the Wayne-based medical technology company's portfolio of urology products.
Under the terms of the agreement, Teleflex (NYSE: TFX) will make an upfront cash payment of $600 million to Palette, which could receive an additional $50 million if certain undisclosed commercial milestones are achieved.
Palette Life Sciences, based in Santa Barbara, California, is focused on developing products that improve patient outcomes in urology and urogynecology disorders, colorectal conditions, radiotherapy, and interventional oncology procedures. The company estimates it will generate net sales of $56 million this year.
One of Palette's key products is Barrigel, a non-animal stabilized hyaluronic acid (NASHA) spacer designed to reduce radiation delivered to the rectum during prostate cancer radiation therapy. Health officials estimated 288,000 new cases of prostate cancer will be diagnosed in the U.S. in 2023. Its other products include Deflux and Solesta, which are non-animal stabilized hyaluronic acid-based tissue bulking agents designed to treat pediatric vesicoureteral reflux, a condition in which urine flows backward from the bladder, and fecal incontinence, respectively.
Teleflex CEO Liam J. Kelly said part of the company's growth strategy is to "deploy capital" for innovative products and technologies that can meaningfully enhance clinical efficacy, patient safety and comfort; reduce complications and lower the overall cost of care.
“The acquisition of Palette Life Sciences will allow us to incorporate [the company's] exciting technology into our interventional urology business unit and bring urologists, radiation oncologists, and other specialists more innovative technologies that can positively impact patient care," Kelly said in a statement.
Teleflex's interventional urology portfolio currently is highlighted by the UroLift System for benign prostatic hyperplasia, commonly known as enlarged prostate — a condition that afflicts an estimated 42 million men in the U.S.
In 2022, Teleflex reported a profit of $363.1 million on revenue of $2.79 billion. The company has 15,500 employees, including of 4,000 in the U.S.
In addition to urology, Teleflex's products and technologies are used in areas including surgery, vascular access, interventional cardiology and radiology, anesthesia, emergency medicine, and respiratory care.
Shares of Teleflex were up more than 1% to $258.90 early afternoon trading on Wednesday.
