In need of a tissue transplant? Fish skin is the answer – at least according to Kerecis, the Icelandic wound care company that agreed to be acquired by medical device giant Coloplast in a $1.3bn deal.

The acquisition, which includes an upfront cash payment of $1.2bn (DKK 8.2bn), is expected to be completed in Q4 of this fiscal year. At least 90% of Kerecis’ shareholders need to part with their stake in the company for the deal to go ahead – the number is currently at 77%.

According to Coloplast, Kerecis has been one of the fastest growing companies in the biologics wound care segment since it launched its first product in 2016. Now, Kerecis has a range of fish skin-based products for the treatment of damaged tissue. Last year, the company netted around $75m in revenue.  

As of April 2023, around 150 million Americans have insurance coverage for Kerecis’ fish skin treatment.

A market model by GlobalData reveals that the tissue engineered skin substitutes market is forecast to reach almost $3bn by 2033. The model reveals that cellular skin substitutes which do not include an amniotic membrane – a scaffold used to help epithelial growth – will make up $987m of the market. This segment also includes xenogeneic skin substitutes. Overall, the wound care management market is expected to total $38.8bn by 2030, with a CAGR of 3.4%.

Most tissue-transplant products that are currently in use are human or porcine tissue. According to Kerecis, the risk of a disease being passed on means heavy processing, which removes much of the components that make it beneficial for growth, is needed.

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A better option, it says, is the North-Atlantic cod which has no known viral transfer risk to humans. Kerecis says its patented skin only requires mild processing and offers improved economics and clinical performance.

Coloplast expects that the acquired tech will add around 1% to its organic growth rate starting next year. The company also raised its long-term growth guidance to 8-10% (up from 7-9%) as a result of the deal. Kerecis will still operate as a stand-alone business.

“Kerecis has developed a sustainable and highly scalable technology platform, produced with minimal processing, that provides the benefit of improved wound healing. With its strong growth track record, high gross margin profile, we believe we’ve secured a unique asset, that will strategically transform our presence in the advanced wound care market,” said Coloplast’s president and CEO Kristian Villumsen in a conference call announcing the acquisition.