A Medical Device Daily

Novadaq Technologies (Toronto), a developer of medical imaging systems and image-guided therapies for the operating room, said it will acquire certain business assets of Xillix Technologies (Richmond, British Columbia), including all of Xillix's intellectual property, certain capital assets and inventory. Novadaq will pay Xillix C$3 million at closing of which C$1,075,000 will be paid in cash and C$1,925,000 will be paid in cash or, at Novadaq's election, stock (at an issue price of $8.56 a share.

The IP purchased includes Xillix's auto-fluorescence and multi-modal imaging portfolio of 31 issued patents and multiple pending applications in the U.S., Japan and Europe. The acquisition also includes licensed rights to fluorescence imaging technologies. The assets include endoscopy cameras and light sources.

"The Xillix acquisition should enable us to accelerate our commercialization efforts in the area of endoscopic fluorescence imaging and image guided therapies in minimally invasive surgical procedures," said Dr. Arun Menawat, president/CEO of Novadaq. "Real-time fluorescence imaging through endoscopes should allow surgeons performing minimally invasive procedures through small incisions to see much more than what is possible with present day technology."

Novadaq said that combining its existing intellectual property for open and minimally invasive procedures with the Xillix portfolio, gives it the flexibility to potentially provide the most advanced imaging and image guidance in both procedural markets and across many specialties in the future.

Closing of the Xillix transaction, currently scheduled for early May, is subject to various conditions, including approval by the Supreme Court of British Columbia in connection with Xillix's CCAA proceedings, and the Toronto Stock Exchange.

Biotel (Minneapolis) reported that its board of directors voted to decline the previously reported proposal of Arrhythmia Research Technology (ART; Fitchburg, Massachusetts) to acquire it for $4 a share in cash or 0.154 shares of ART's common stock (Medical Device Daily, April 13, 2007).

The Biotel board said it believes the proposed purchase price is "inadequate" and that this is "the wrong time" to sell the company.

Biotel said it has made investments over the past two years in new products and services which are coming into their own, including a new Holter recorder and a new event recorder at its Braemar buisness. It said that its Agility business "has developed a solid position contracting ECG clinical research services for new cardiology devices and on methods used to treat atrial fibrillation."

The company said Agility is expected to achieve profitability within the next two or three quarters.

Biotel through its subsidiaries offers analog and digital Holter recorders and tape playback systems for analog devices. Holter recorders enable physicians to monitor and analyze a patient's heart activity over a continuous period without the need for hospitalization.

The company also manufactures digital cardiac event recorder products, which record heart functions over a month or longer time period to record infrequent events, such as arrhythmia

In other dealmaking news: Tyco International (Pembroke, Bermuda) reported that the Surgical Devices business of Tyco Healthcare (Mansfield, Massachusetts) has acquired Sorbx's (Jacksonville, Florida) AbsorbaTack product and related assets.

Terms of the transaction were not disclosed.

AbsorbaTack is an absorbable tack technology for use in both inguinal and ventral hernia repair. Hernia repair typically involves use of a prosthetic mesh implant to secure the organs within the abdominal cavity and to provide additional support to the repaired abdominal tissue. The mesh itself is secured to the abdominal wall with a combination of tacks, staples and/or sutures.

Tyco International also reported that it has filed amended Form 10 and S-1 documents with the U.S. Securities and Exchange Commission related to its upcoming separation into three independent, publicly-traded companies.

Tyco expects the offerings, along with the final separations, to be completed by the end of second calendar quarter of 2007, the exact timing dependent on the effective date of the registration statements and final approval by Tyco's board of the tax free stock dividends for Tyco Electronics and Tyco Healthcare, now known as Covidien, to shareholders owning Tyco stock as of the record date.