November 11, 2009
Stryker Acquires OtisMed

Stryker announced the acquisition of OtisMed, a software company that manufactures custom cutting guides for total knee replacements. Financial terms of the deal were not specifically disclosed, but Stryker simultaneously announced the acquisition of the Sonopet Ultrasonic Aspirator, and the combined deals were said to be valued at $67 million in upfront payments with potential for an additional $36 million in milestone and royalty payments.

Stryker says the OtisMed cutting guides will complement existing products, such as the Triathlon Knee. Custom guides have the benefit not only of improving implant fit, which can reduce the risk of failure, but also have the potential to reduce the amount of bone removed for the procedure. Preserving tissue has increasingly been a focal point in orthopedic product development, and this has been emphasized in recent investing activity: like OtisMed, Conformis manufactures custom knee implants and instrumentation, and they recently raised $50.0 million to support further development and commercialization of their product offering.