NxStage inks licensing deal with Japanese firm

Tuesday, May 19, 2009, 2:59pm EDT
NxStage inks licensing deal with Japanese firm
Boston Business Journal

Dialysis product company NxStage Medical Inc. has entered into a strategic business alliance with Japan-based medical supply company, Asahi Kasei Kuraray Medical.

Asahi will provide Lawrence, Mass.-based NxStage (Nasdaq: NXTM) with $40 million of debt financing to pay off its entire $28 million debt obligation owed under its GE credit facility. In return, NxStage will grant Asahi a royalty-free license to its production technology to make and sell NxStage’s current dialyzer design exclusively in Asia and nonexclusively in rest of world. NxStage retains all rights in North America. Dialyzers are disposable medical equipment used in home dialysis for renal failure.

“Our relationship with one of the largest renal product companies in Asia is an important step for NxStage as we extend our commercial operations globally,” said NxStage CEO Jeffrey H. Burbank, in a statement. “I believe this transaction will accelerate our path to profitability. We are enthusiastic that this relationship with Asahi will deliver significant value to our shareholders, strengthen our balance sheet, and create growth opportunities in 2010 and beyond.”

NxStage’s stock was trading at $2.31 in early afternoon trading on Tuesday, up from its previous close of $2.13.

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