Cytyc Wraps Up Acquisition of Proxima Therapeutics

Earlier this month, Cytyc Corp. (Marlborough, MA), a leading women's healthcare company, announced that it had finalized the acquisition of privately held Proxima Therapeutics Inc. (Alpharetta, GA), a manufacturer of site-specific cancer treatment delivery systems. The all-cash deal was first announced in February with a purchase price of $160 million plus additional performance-based incentives.

Cytyc has been steadily building its presence in the women's health category over the last few years through both acquisitions and organic growth initiatives. The company's ThinPrep cervical cancer screening system now controls approximately 70% of the U.S. market for Pap smear screening and generated $300 million in sales for 2004. Cytyc also manufactures the NovaSure system, an endometrial ablation device to treat excessive menstrual bleeding, and the FirstCyte test for breast cancer risk assessment.

With the acquisition of Proxima Therapeutics, Cytyc gains access to the company's MammoSite radiation therapy system (RTS), a single-use device for the treatment of breast cancer that pinpoints and delivers postsurgery radiation directly to the site where the tumor was removed while minimizing damage to the surrounding healthy tissue. With breast-sparing surgeries such as lumpectomies becoming an increasingly preferred option for cancer patients, therapeutic modalities such as the MammoSite RTS are seen as a prime area for growth. Increased adoption of the system has been aided by the additional patient benefit of significantly reduced recovery periods—typically from 30 days with traditional whole breast radiation to 5 days with MammoSite.