SINGAPORE - Medtech firm QT Vascular on Thursday (May 24) said it has entered into an asset purchase and option agreement with Teleflex Life Sciences Unlimited Company and New York-listed Teleflex Incorporated to sell the firm's intellectual property rights to its non-drug coated coronary products, including Chocolate XD and Glider.
The deal also provides Teleflex with an option to purchase the drug coated coronary balloon catheter, known as Chocolate Heart, which is under development.
The total consideration for the deal is $98.4 million in cash - S$26.2 million for the non-coated coronary products, $65.6 million for the coated coronary product and up to $6.6 million in payments upon the achievement of certain revenue milestones from the sales of the non-coated products by Teleflex.
QT Vascular noted that the value of the deal far exceeds the firm's market capitalisation of $36.3 million as at May 23.
It said the proposed sale represents an "attractive opportunity" for the group to realise the value of its products. It will also strengthen the group's balance sheet. The company had a net cash position of US$2.7 million as at its fiscal first quarter of 2018.
The sales proceeds will also enable the group to further develop other products, including its Chocolate Touch®, which is on the path to approval from the US Food and Drug Administration, said QT Vascular.
It will also be entering into several business agreements with Teleflex, such as supply agreements to manufacture and supply both the non-coated and coated coronary products.
Along with the royalties that QT Vascular is entitled to receive from Teleflex, the value of this transaction to the company is expected to exceed $100 million, it said.
QT Vascular shares were flat at 1.8 cents as at 2:45pm. Trading in the shares, which was halted before the market opened on Thursday, resumed after the announcement.