International medical devices company AMS has acquired Israeli company Sealantis, which has developed adhesives for the medical market, for $25 million. AMS specializes in treatment of wounds. The share price of holding company Teuza - A Fairchild Technology Venture Ltd. (TASE:TUZA), which owns 19.2% of Sealantis, rose 5% following the announcement, boosting its market cap to NIS 57 million.
Sealantis developed a series of surgical sealing products designed to stop hemorrhaging, prevent leakage, from the digestive tract into the abdominal cavity, prevent leakage of spinal column fluid, and other applications. The company's products have been approved for marketing in Europe, although substantial sales have not yet begun.
The company was founded on the basis of technology from Technion, Israel Institute of Technology that imitates a natural biological mechanism in algae in order to adhere to undersea boulders. The body environment in which tissue must adhere following surgery is also a moist environment in which conventional glue does not stick. The current sealing methods are based on using anti-coagulants produced from blood units, synthetic imitations of these materials, or plastics. Sealantis's product is not plastic, but does not have to be produced from a blood unit. It is less sensitive to infections. In contrast to natural products, it does not arouse allergic reactions.
Companies active in this sector in Israel include Omrix Biopharmaceuticals, a subsidiary of Johnson & Johnson after being acquired by that acompany in 2008, and LifeBond. The sector aims to substitute adhesives for surgery as much as possible, which saves on personnel and time in operating theaters, does a better job of sealing, and possibly also reduces scarring.
Sealantis was founded at the Alfred Mann Institute at the Technion (AMIT), an institute begun with a donation from late billionaire Alfred Mann in order to support the Technion's applied medical research and turn it into commercial companies. Sealantis's founder is Prof. Havazelet Bianco-Peled from the Technion's chemical engineering faculty, a world-renowned researcher in medical polymers.
AMIT is also an investor in Teuza, an early investor in Sealantis.
AMS undertook to invest $10 million in Sealantis's activity in the three years following the sale. Sealantis CEO Tomer Fuchs said today that AMS was planning to expand his company's activity in Israel. "Sealantis's journey has reached a peak. The merger into AIMS is an important milestone on the road to realizing our vision." He added that a majority of Sealantis's team consisted of women: chemical engineers, biotechnology engineers, and graduates of Technion and other universities.
Bianco-Peled said, "After we decoded the adhesive mechanism of algae, we realized that it could be applied to moist surfaces on the human body, and we registered a patent because of its possible commercial potential. I had the privilege of being involved in the development of the product, going to hospitals and helping patients. There is no doubt that commercialization of this patent is an interesting experience. I was exposed to fields I would have known nothing about, had I just stayed in the laboratory. It was an experience I wouldn't want to have missed, even though research is my main focus." Bianco-Peled is now continuing her research in polymers for medical uses.
Technion EVP research Wayne Kaplan said, "This is an inspiring case that shows how basic research became applied research and culminated in the founding of a company. At the end of this long process, it was acquired by a leading international company in the field."
Teuza's holdings include Tyto, which develops medical devices enabling a family doctor to conduct medical tests completely online and recently raised $27 million; PV Nano Cell (8%), which recently signed an agreement to supply nanometric ink to the materials division of German company Merck; advertising company MediaBoost, and others. Teuza estimates the fair value of its assets at $25 million.
Published by Globes, Israel business news - en.globes.co.il - on January 31, 2019
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