10
Company Description
As of December 19, Biomatrix,
Genzyme Tissue Repair and Genzyme
Surgical Products have merged to
form Genzyme Biosurgery. This new
entity will focus on formation of novel
biomaterials and biotherapeutic prod-
ucts for use in surgical and medical
procedures, with a particular empha-
sis on orthopedics and cardiothoracic
surgery. The company's combined
2001 projected revenue is approxi-
mately $255 to $265 million dollars,
consisting of bio-orthopedics
(approximately $112-117 million),
cardiothoracic (an estimated $84-87
million), and surgical products and
instruments (roughly $50-70 million).
The newly formed corporation will
have six manufacturing facilities and
a head count of over 1,300 employees,
including a major sales and marketing
infrastructure aimed at the orthopedic
and cardiothoracic surgery markets.
Genzyme Biosurgery is expected
to report a loss this year and hopes to
be profitable within the next 5 to 6
quarters. Genzyme Biosurgery is a
division of Genzyme Corp.
Valuation
Since there is no combined his-
tory on the three companies that now
form Genzyme Biosurgery, perhaps,
the best way to evaluate the new com-
pany is to break up the entity and look
at the merits of each part.
The former Biomatrix developed,
manufactured, and marketed a num-
ber of proprietary viscoelastic prod-
ucts consisting of hylan polymers.
These polymers are modified forms of
naturally occurring hyaluronic acid
(HA), found in the intercellular ma-
trix of most human tissue.
Two hylans have been developed
by Biomatrix: hylan A and hylan B.
Hylan A is a highly elastoviscous
fluid, while hylan B is a very elastic
gel or solid in various forms and
shapes. These are the two modified
forms of the natural hyaluronan mole-
cule that have been introduced in
various medical therapeutic areas.
Biomatrix created the first modified
hyaluronan molecules applicable to a
broad variety of medical therapeutics.
With these two new biological poly-
mers, the Biomatrix division is in the
process of developing more effica-
cious treatments in a broad spectrum
of medical applications.
The division's lead product is
Synvisc, a liquid hylan polymer that is
injected into the knee joint in order to
alleviate pain associated with osteoar-
thritis. Injected directly into the knee
joint, the viscosupplementation serves
as a shock absorber and lubricant for
patients nonresponsive to painkillers,
exercise or physical therapy. Made of
hylan A and hylan B biological poly-
mers, manufactured from naturally
occurring hyaluronan (derived from
rooster combs), Synvisc is designed to
replace diseased synovial fluid present
in osteoarthritic knees. Synvisc is
marketed by partner, Wyeth-Ayerst,
with Biomatrix retaining co-
marketing rights.
Osteoarthritis affects nearly 16
million individuals domestically, and
at least many others internationally.
Using the company's proprietary hy-
lan technology, Biomatrix has devel-
oped an innovative new therapy for
the treatment of pain associated with
osteoarthritis of the knee. Synvisc, the
company's lead product, offers pa-
tients a superior treatment alternative
that avoids the significant drawbacks
Genzyme Biosurgery
Product Pipeline
(abbreviated)
Product
Indication
Status
Synvisc
Osteoarthritis
Marketed
Carticel
Cartilage replacement
Marketed
Epicel
Severe burns
Marketed
FocalSeal
Surgical sealant
Marketed
CFTR gene therapy
Cystic fibrosis
Phase I
BetaKine
Skin Ulcers
Phase II
Sepragel
Surgical adhesions
Phase I
BioTech Sage Report, January 2001
