Bioventus Snaps Up Bioness; Street Remains Bullish

Bioventus Inc. has acquired medical devices provider Bioness Inc. for a total consideration of $110 million. This includes an up-front payment of $45 million and milestone payments of up to $65 million.

Bioventus (BVS) CEO, Ken Reali, said, “We aim to accelerate Bioness’ revenue growth by leveraging our existing global network of approximately 300 sales representatives calling on orthopaedic, pain and podiatric physicians as well as expanding market access and reimbursement processing capabilities.”

Bioventus is paying the up-front consideration from cash on hand. The transaction includes Bioness’ complete product portfolio along with its research and development pipeline.

Bioness’ products include electrical stimulation exoskeletal devices, robotic gait and fall safety systems and interactive software learning and recovery assessment platforms.

Bioventus expects this acquisition to be revenue accretive and boost its multi-year revenue growth. It sees revenue for 2021 to be in the range of $390 million to $402 million including the revenue impact of the Bioness acquisition. (See Bioventus stock analysis on TipRanks)

On March 26, Canaccord Genuity analyst Kyle Rose reiterated a Buy rating on the stock and maintained a $23 price target (49% upside potential).

Commenting on the company’s 2021 guidance, Rose said, “2021 guidance bracketed expectations and offers multiple routes to upside across each of its three business units. We see continued momentum as the company works through what we hope to be the late innings of the COVID-19 pandemic and transitions to ‘business as usual’ in H2/21.”

Rose added, “We believe Bioventus has the assets, scale, clinical differentiation, and pipeline to break through as a classic small-cap medtech execution story.”

Turning to rest of the Street, the stock has a Strong Buy consensus rating alongside an average analyst price target of $19.25 (24.7% upside potential) based on 4 unanimous Buys.

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