Collaboration as an industry “adhesive”

The challenging economic and market climate is driving more and more medtech businesses toward collaboration that improves the efficiencies and market performance of companies when that kind of edge might just mean the difference between the business being an "ongoing concern" and another Chapter 11 statistic.
 
Case in point. Haemacure, struggling for viability, reported on second quarter results and on the strategic collaboration with Angiotech Pharmaceuticals. The deal with Angiotech is two-fold.
 
First, the agreement gives Angiotech rights to license, distribute and supply Haemacure’s all-human fibrin sealant and thrombin products, both of which are currently in development. Second, Harmacure gains with bridge financing from Angiotech up to $3.5 million, which will sustain Haemacure at least through the end of calendar 2009.
 
As noted previously (see "equity overhang"), VC-based financing options (despite the existence of ample funds) have become limited, requiring cash-hungry entrepreneurs to search elsewhere. The result is increasingly, like in the case of Haemacure/Angiotech, deals that happen between industry players.
 
Not that there’s anything wrong with VC financing, but deals being struck between industry players has the potential, in this writer’s opinion, to be more grounded in the long-term success of these players than would deals by VC players who put investment on hold at a time when, frankly, the medtech industry could not need it more.

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