Covidien spinout Mallinckrodt to acquire Stratatech

Mallinckrodt plc (NYSE: MNK) said today that it agreed to acquire Stratatech and its StrataGraft artificial skin graft technology for an undisclosed amount.

Mallinckrodt, the pharmaceuticals business spun out of Covidien in 2013, said the deal also includes Stratatech’s development program for genetically enhanced skin. The acquisition is expected to close before the end of the year, the Dublin-based company said.

StrataGraft, which is in a Phase III trial for treating deep, partial-thickness burns and a 2nd, Phase II trial for treating severe, full-thickness burns, is a cell-based living tissue designed to mimic the properties of natural human skin. Mallinckrodt said today that it expects to win FDA approval for the deep, partial-thickness burn indication by 2020. The product won “orphan” status from the federal safety watchdog in 2012 and is traveling the biologics license application protocol with the FDA that, if granted, would give Mallinckrodt patent protection until 2032.

Stratatech is also working on a Phase I project to develop topically applied, genetically enhanced skin products for treating diabetic foot and venous leg ulcers.

The deal also requires Mallinckrodt to maintain its contracts with the U.S. Defense Dept.’s Biomedical Advanced Research & Development Authority and the Health & Human Services Dept., the company said.

“The addition of this highly durable, cutting-edge development portfolio and technology platform to our hospital growth business is an excellent example of Mallinckrodt’s acquire to invest strategy,” president & CEO Mark Trudeau said in prepared remarks. “We believe Stratatech’s technology has the potential to transform the standard of treatment for wound care. Additionally, the acquisition will bring world-class Stratatech researchers with deep expertise in cell-based, differentiated regenerative medicine to Mallinckrodt’s research team.”

“Stratatech brings dedicated scientific and development know-how to Mallinckrodt, along with a broad, innovative progenitor keratinocyte2 technology platform,” added Stratatech CEO Lynn Allen-Hoffmann. “In our next phase of development, the unique cell line used to produce living tissue in StrataGraft can also be genetically modified to potentially increase production of a variety of factors to support and promote wound healing, such as antimicrobial and vascular endothelial growth factors. This could offer utility in a number of skin injury settings beyond burns.”

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