LONDON: RUA Life Sciences (AIM: RUA) has acquired the entire issued share capital of Analytic Biosurgical Solutions SAS, for a cash consideration of €80,000 from the French liquidator of IPSA SAS, the former parent company of Abiss.
The acquisition will be funded from the Company’s existing cash resources and will be paid in full on completion.
Founded in 2000, Abiss is the legal manufacturer of a number of long term implantable devices as well as being a sub contract manufacturer of medical devices for third parties from its factory and clean room facilities in Saint Etienne, France where it has around 20 employees.
It is the stated objective of RUA to double the scale of its contract manufacturing business over the medium term. This opportunity, which aligns with this objective, arose when the Company was asked by a significant customer to assist in de-risking certain supply chain issues due to the insolvency of the parent company of Abiss, one of its suppliers.
Since its creation, Abiss has promoted an innovative approach to surgical implants working closely with surgeons to develop the first sling for the treatment of female Stress Urinary Incontinence (“SUI”) (trans obturator route) with this procedure becoming the “gold standard”.
Abiss owns the IP and has CE Mark approval for three products in the SUI field, Aris, Supris and Cyrene which are marketed in Europe by distributors (including an Abiss 60% subsidiary in Poland). The Aris and Supris products are licensed to and manufactured for Coloplast who hold FDA approval for these products in the US. During the past three years, Abiss has successfully completed the compilation of data necessary to transition its products from the outgoing Medical Device Directive regulations to the new MDR system.
Abiss has also developed a third-party contract manufacture business over the past two years. While the procedure and devices that Abiss supplies have historically been the subject of litigation and it has been a party to claims, all such claims have been settled and there are no potential claims notified or disclosed.
The gross assets of Abiss at 31 December 2023 were €2,265,000. Revenue in the year to 31 December 2023 was €2,159,000 up 36% from €1,592,000 during 2023. Loss before tax was €352,000 after depreciation and amortisation charges of €537,000. In the year to 31 December 2023, Abiss had net positive cash flow of €223,000 and cash balances of €279,000 at the year end. Net Assets/Shareholders Funds at 31 December 2023 were €1,624,000. Non-current liabilities totalled €640,000 at 31 December 2023.
Abiss was part of a wider medical devices group which went into insolvent liquidation in June 2021 because of Covid. Although the parent company was in liquidation, Abiss itself was not placed in receivership/liquidation. Abiss has continued to trade solvently and has traded within its own financial resources with the exception of French Government Covid support loans.
The balance of these loans at 31 December 2023 was €293,000 (€418,000 in 2022) and these are being repaid over an agreed period. The nature of the transaction has precluded an extensive financial due diligence process and post-acquisition a detailed financial forecast for the Abiss business will be developed.
Based on discussions with Coloplast, the board is confident that there is continuing commitment to the Abiss products and there should not be any negative impact on RUA profitability as a result of the acquisition.
Bill Brown, CEO of RUA Life Sciences, stated: “There are many similarities between Abiss and RUA Contract Manufacture, particularly with a shared customer. Abiss has been pursuing contract manufacture opportunities to further grow its business and the combined strengths of RUA and Abiss should only increase the potential. We very much look forward to working with the Abiss team and integrating into the RUA group.”