Ch.7 Acquisition NuOrtho-Email-opportunity-page2

Opportunity:

Energy-Based Medical Device IP Portfolio and Related Assets

INTRODUCTION

Hilco Streambank has been retained as the exclusive agent for purposes of marketing and selling the NuOrtho Surgical, Inc. (“NuOrtho” or the “Company”) asset portfolio. The Company filed for bankruptcy protection in the United States Bankruptcy Court of the District of Massachusetts on February 12, 2015. The Company’s Chapter 7 Trustee, Donald R. Lassman, retained Hilco Streambank to sell the Company’s intellectual property portfolio and certain related assets.

The NuOrtho assets relate to technology in the energy-based medical device sector and comprise a significant advance in surgical treatment. Called “Smart Tools,” NuOrtho’s technology is the only technology in the industry designed to mimic the human body’s physiologic mechanisms in order to improve patient care outcomes. As in biologic energy transfer pathways, energy is transferred through interfacing agents in which the energy is converted into the appropriate biologic form for tissue treatment. It is for this reason that NuOrtho can eliminate iatrogenic collateral damage while competitors cannot.

Almost two dozen peer-reviewed articles have been published describing NuOrtho’s technology and its beneficial surgical effects upon human tissue. The publications include participation by numerous researchers worldwide, including those affiliated with the Bioscience Division, the Theoretical Division, and the Center for Integrated Nanotechnologies of the Los Alamos National Laboratory, U.S. Department of Energy.

BACKGROUND

Founded in September 2008, NuOrtho was formed as a privately held medical biotechnology company incorporated in Delaware. Shortly after formation, the Company acquired “Smart Tools” intellectual property assets from MAP Technologies, LLC. Conceived through treatment site energy conversion science, the technology covers three broad surgical disciplines; Soft Tissue Treatment, Therapeutic Agent Delivery, and Bone Fusion.

After the acquisition, NuOrtho began fund-raising efforts to commercialize the technology in a step-wise fashion, seeking initially to produce the first-ever Physiochemical Scalpel able to achieve precision resection that unencumbers tissue wound healing behaviors. By establishing the scientific and clinical efficacy of the Physiochemical Scalpel in the marketplace, NuOrtho planned to expand its product line into the three broad surgical disciplines defined by the acquisition.

After obtaining FDA 510K clearance in July 2010 (K101711), NuOrtho launched its first commercial product, Ceruleau®, in early 2011 in selective U.S. markets containing key opinion leaders. Ceruleau is a single-use, disposable, physiochemical scalpel designed for precision resection of damaged or diseased tissue during arthroscopic surgical procedures. Although its 510K clearance allows treatment of many different tissue types in six joint cavities, the Ceruleau Medical Device System, on account of its resection precision, found rapid adoption for the treatment of articular cartilage due to the large disease burden of osteoarthritis and the unmet clinical need for non-palliative treatment of articular cartilage lesions. Ceruleau remains the only non-palliative, wound healing surgical treatment option for articular cartilage lesions and has been successfully used in over 1,500 surgical procedures with zero FDA-MDR adverse events.

While NuOrtho has developed a strong intellectual property portfolio covering the Physiochemical Scalpel and several areas of downstream technology and product line expansion, further commercialization efforts were truncated.

Litigation unrelated to the Company’s products and technology caused the Company to incur substantial legal expenses. The Company was unable to fund the resulting legal expenses and its product sales force simultaneously and, as a result, filed for bankruptcy.

Soft Tissue Treatment: NuCareTM

The NuOrtho Soft Tissue Treatment technology discipline encompasses wound care technology that removes damaged or diseased tissue while preserving healthy tissue and encouraging the preserved tissue to naturally repair itself. Hence it is the only true tissue preservation technology in the industry.

Ceruleau® (or “blue water” named after azurophilic granules) mimics the behaviors of human neutrophils during the acute phase of wound healing. Neutrophils are white blood cells that discharge proton gradients from their secretory vesicles to disaggregate damaged or diseased tissue, preparing the unwanted tissue for removal so that a healthy wound bed can be created as the predicate for physiologic wound healing. Ceruleau delivers a proton gradient via magnetohydrodynamic propulsion directionalized to the treatment site by a plenum. Ceruleau has well-known CPT codes for all joint cavities and established reimbursement in the U.S. via the DRG payment system.

NuPolarTM is a universal bipolar ablation medical device system that eliminates the need to amortize the cost of a dedicated electrosurgical generator.  The use of blended generator waveforms, higher peak-to-peak voltage capabilities, and the lower power requirements of protected electrode geometries have been shown to improve functional performance and to produce less iatrogenic collateral damage than thermal and plasma ablation devices.

By utilizing NuOrtho’s proprietary bridge circuitry, these devices are powered, without the need for a patient return pad, by non-dedicated standard electrosurgical generators already present in operating theaters so that no capital equipment is required for NuCare products. Eliminating extra generators from the operating room is part of NuOrtho’s healthcare safety and cost-containment strategy.

Therapeutic Agent Delivery: Engineered IrrigantsTM

The NuOrtho Therapeutic Agent Delivery technology discipline comprises irrigant-based therapeutic agents and the delivery systems necessary to deposit these agents at the surgical site. For example, Ceruleau utilizes the synovial fluid replacement media during arthroscopy as an interfacing agent for energy conversion with the water molecule as the energy transducer. The interfacing agent is locally converted to an Engineered Irrigant deploying a proton gradient in a process described as AquaChor®. The AquaChor Wave irrigates the tissue, producing wound healing charge movements at tissues surfaces.

In conjunction with preserving healthy tissue at the repair site, thereby allowing additional local tissue to participate in healing responses, agent delivery technology provides physiochemical, mechanical, and metabolic benefits to preserved healthy tissue in the wound bed. Expanding AquaChor embraces other charged pharmaceutical agents, like hyaluronan, that are naturally suited for delivery within an Engineered Irrigant for procedure-specific applications designed to enhance biologic healing responses.

Bone Fusion: NuBoneTM

The NuOrtho Bone Fusion technology discipline expands energy interfacing agents into new formulations such as hydrogels, sol-gels, colloids, biopolymers, waxes, and scaffolds and matrices. By placing such interfacing agents between bone tissue segments or grafts, fixation can be achieved by using energy-based devices including laser, ultrasound, radiofrequency, infrared, chemical, and other configurations. In addition to serving as a fixation device, the interfacing agents serve as a means for targeted pharmaceutical delivery to surgical treatment sites.

This discipline represents a major advance in bone fixation by achieving actual molecular joining of bone tissue in vivo with minimal surface preparation while enabling targeted pharmaceutical delivery without the morbidity associated with geographic containment deficits common with other delivery systems. NuBone methods have applications in areas such as sports medicine, spine, maxillofacial, reconstruction, and trauma.

OPPORTUNITY

Buyers have the ability to purchase the assets of the Company including intellectual property and certain related assets.

Assets Include:

  • U.S. and International patents and patent applications
  • Domain names (www.nuortho.com & www.nuorthosurgical.com)
  • Technical designs and schematics
  • Research Data
  • Testing and measurement records including design control and verification/validation (and test units)
  • Manufacturing processes
  • Prototype devices
  • FDA clearance
  • Sales training manuals
  • Proof of concept models

There may also be available, certain finished goods inventory, unassembled parts inventory, testing equipment, surgical power generators, and a manufacturing and packaging line including fixtures, molds, equipment, and tools.

    U.S. and International Patents

    • 6,547,794-Method for Fusing Bone during Endoscopy Procedures
    • 6,902,564-Methods and Devices for Electrosurgery
    • 7,066,932-Biologically Enhanced Irrigants
    • 7,105,011-Method for Achieving Tissue Changes in Bone or Bone-Derived Tissue
    • 7,354,438-Devices for Electrosurgery
    • 7,445,619-Devices for Electrosurgery
    • 001141014-001-Medical Device Handle for Surgical Tool
    • 7,549,989-Electrosurgery Devices
    • D600,808-Medical Device Handle for Surgical Tool
    • 001190649-001-Medical Device Plug
    • 001190649-002-Medical Device Plug
    • 130,873-Medical Device Handle for Surgical Tool
    • D615,042-Medical Device Plug
    • 7,713,269-Devices or Electrosurgery
    • 7,771,422-Methods and Devices for Electrosurgery
    • 133,789-Medical Device Plug
    • 7,819,861-Methods for Electrosurgical Electrolysis
    • 7,819,864-Electrosurgery Devices
    • 001242549-0001-Medical Electrical Connector Assembly
    • 001242549-0002-Medical Electrical Connector Assembly
    • 001242549-0003-Medical Electrical Connector Assembly
    • 7,955,296-Biologically Enhanced Irrigants
    • 137,782-Medical Electrical Connector Assembly
    • D661,650-Medical Electrical Connector Assembly
    • 8,235,979-Interfacing Media Manip w/Non-Ablation RF Energy System & Method
    • 8,591,508-Electrosurgical Plenum
    • 8,623,012-Electrosurgical Plenum
    • 8,734,441-Interfacing Media Manip w/Non-Ablation RF Energy System & Method

    U.S. Patent Applications

    • 12/486,616 Active Conversion of a Monopolar Circuit to a Bipolar Circuit Using Impedance Feedback Balancing
    • 13/335,674 Connection of a Bipolar Electrosurgical Hand Piece to a Monopolar Output of an Electrosurgical Generator
    • 13/405,044 System and Method for a Physiochemical Scalpel to Eliminate Biologic Tissue Over-resection and Induce Tissue Healing
    • 13/736,016 Methods and Devices for Electrosurgery
    • 14/106,351 Multifunction RF Probe with Dual Electrode Positioning
    • 14/149,644 Electrosurgical Plenum
    • 14/286,422 Interfacing Media Manip w/Non-Ablation RF Energy System & Method

    U.S. Trademarks

    • NuOrtho 3,944,826
    • Tissue Preservation 4,026,492
    • Water Molecule Logo 4,210,313
    • Ceruleau 3,905,044
    • AquaChor 4,214,212

    Other International Patents, Patent Applications, Trademarks

    Information provided upon request

    SALE PROCESS

    Hilco Streambank is currently soliciting interest in this opportunity. Further diligence information is available for review.