UTICA — ConMed Corp. (NASDAQ: CNMD), a Utica–based surgical-device maker, is looking ahead to the first quarter of 2019 when it expects to close on its acquisition of privately held Buffalo Filter LLC for $365 million. Buffalo Filter is a “globally recognized brand in surgical safety,” a firm that specializes in surgical-smoke evacuation products, ConMed […]
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UTICA — ConMed Corp. (NASDAQ: CNMD), a Utica–based surgical-device maker, is looking ahead to the first quarter of 2019 when it expects to close on its acquisition of privately held Buffalo Filter LLC for $365 million.
Buffalo Filter is a “globally recognized brand in surgical safety,” a firm that specializes in surgical-smoke evacuation products, ConMed said in a news release.
The acquired company is located in the Buffalo suburb of Lancaster. It is part of the Oak Brook, Illinois–based Filtration Group, per its LinkedIn page.
The transaction is expected to be financed through a combination of new convertible notes and an expanded and amended credit facility, ConMed said.
In the news release, Curt Hartman, president and CEO of ConMed, called the acquisition a “strong strategic fit” with the company’s general-surgery portfolio. He also spoke that day in a conference call with analysts and investors about the acquisition.
“Augmenting our product portfolio with innovative surgical solutions and technologies has been a strategic priority for ConMed. Buffalo Filter’s smoke evacuation and filtration equipment will enhance our advance-surgical offering by adding category-leading smoke-evacuation products targeting open surgical procedures to our [offerings],” Hartman said on the call.
“Additionally, … we are thrilled with the financial benefits that we expect this acquisition to drive on both the top and bottom line, further positioning us to achieve long-term, profitable growth,” Hartman added.
United Kingdom–based Barclays Capital is acting as financial advisor, New York City–based Sullivan & Cromwell LLP is the legal counsel, and J.P. Morgan, also headquartered in New York City, is leading the financing for ConMed in connection with the transaction, the company said.
New York City–based Goldman Sachs is acting as financial advisor and Los Angeles, California–based Paul Hastings LLP is acting as legal counsel for Filtration Group in connection with the transaction, per the ConMed release.
Surgical smoke
Hartman also used the conference call to provide background on surgical smoke and why ConMed believes the use of smoke-evacuation products will continue to increase both in the U.S. and abroad.
“Surgical smoke … is a dangerous byproduct generated in 95 percent of all surgical procedures as energy-based devices such as lasers, electro-surgical pencils, and ultra-sonic devices, many of which we sell, cauterize vessels and vaporize tissue, fluid and blood.
“In the U.S., more than 500,000 health-care workers per year are exposed to this dangerous byproduct, which has been known to cause respiratory and eye irritation as well as nausea, and ash has the same carcinogenic effects as cigarette smoke,” Hartman said.
Despite these health and safety risks, surgical-smoke evacuation products are currently used in just 5 percent of the procedures in the U.S. and less than 2 percent of the procedures internationally.
ConMed believes Buffalo Filter is well-positioned to take advantage of the rapidly evolving market opportunity as adoption begins to increase.
“Driving the increased adoption is the fact that states are beginning to explore legislation that protects operating-room employees from the dangers of surgical smoke,” Hartman explained.
Rhode Island recently became the first state to pass smoke-evacuation legislation, while California and Colorado have recently introduced similar legislation, he noted. On the international front, a “handful of countries,” including Australia, Canada, Holland, Great Britain, and New Zealand have either begun exploring or have already passed legislation recommending or mandating smoke evacuation.
“Looking forward, we see significant opportunities to capitalize on the growing demand for smoke-evacuation products,” said Hartman. “We believe that we’ll be able to take this technology to the next level.”
About Buffalo Filter
Founded in 1991, Buffalo Filter develops surgical-smoke evacuation technologies, ConMed said. The company’s product portfolio includes smoke-evacuation pencils, smoke evacuators, and laparoscopic products.
“We are excited to join ConMed and continue our mission of improving safety in the operating room,” Samantha Bonano, president and CEO of Buffalo Filter, said in the ConMed release. “We believe that the combination of our dedicated teams, as well as our proven research and development expertise, will enable us to continue to bring best-in-class smoke-evacuation products to a growing global market.”
