Nevro Acquires Vyrsa Technologies

Nevro, a chronic pain medical device company, today announced the acquisition of Vyrsa Technology, a company focused on minimally invasive treatments for patients with chronic sacroiliac joint (SI joint) pain, for $40 million at closing and up to an additional $35 million in cash or stock tied to the achievement of certain development and sales milestones.

Nevro is the creator of HFX, a comprehensive solution for individualized relief of chronic pain. The company created a next generation approach to spinal cord stimulation (SCS) called 10kHz Therapy, which provides patients with significant pain relief and no paresthesia. The Nevro Senza SCS System for 10 kHz Therapy originally received CE mark in 2010, FDA approval in 2015, and is commercially available in Europe, Australia, and the United States. In the US, the SCS systems are approved to deliver all available SCS frequencies and the most waveform types in a single product, according to the company.

Vyrsa provides innovative implant solutions to patients experiencing SI joint pain. Its portfolio includes the Vyrsa V1 SI Fusion System, Vyrsa Pro, Siconus Lateral Screws, and Hybrid Approach. The V1 SI Fusion System is the first FDA 510(k)-cleared sacroiliac joint fusion implant featuring integrated lateral transfixation, according to Vyrsa. Vyrsa Pro is described as a custom cortical allograft implant designed specifically for SI joint fusion and is delivered through a novel inferior inlet approach. The Siconus Lateral Screws provide compression to treaded fixation implants and the Hybrid Approach allows for strict adherence of bone fusion principles with articular decortication, fixation, and compression of the joint space, Vyrsa said.

The acquisition will accelerate Nevro’s key initiatives and expand penetration of the company’s existing portfolio. Additionally, the adsorption of Vyrsa’s products will offer increased options for the company’s current consumer base.

“The acquisition of Vyrsa leverages Nevro's ability to drive long-term shareholder value by accelerating our key strategic initiatives of commercial execution, market penetration, and profit progress,” said Kevin Thornal, Nevro CEO, in the press release. “Vyrsa offers differentiated implants to our current call point of physicians that will help drive growth. We are ecstatic to be able to bring long-term pain relief to the 15-30% of people suffering with chronic low back pain associated with the SI joint."

Of note, projections from Nevro suggest Vyrsa will be accretive to the company in 2024 for both revenue and AEBITDA.

Announced in tandem with the acquisition, Nevro also reported the closing of a six-year, $200 million term loan credit facility, with the proceeds being used to repurchase the majority of its 2025 Convertible Notes and for working capital, among other general corporate purposes. The interest on the term loans will accrue at a per annum rate of SOFR + 5.25%. Nevro also “issued the lender a warrant to purchase approximately 2.6 million shares of Nevro common stock at a $23.19 exercise price, representing a 40% premium to Nevro's trailing 5-day VWAP,” according to the release.

“We are excited to be able to diversify our product offering and drive growth with Vyrsa,” said Rod MacLeod, Nevro CFO, in the release. “We are also pleased to refinance a majority of our debt and push the maturity out to 2029. We evaluated multiple financing options and chose this path to limit equity dilution to 2.6 million warrant shares versus a typical convertible offering that would have been much more dilutive. Nevro has had a strong, long-term relationship with Braidwell, an investor in our company and our lender for this transaction, and we look forward to having their continued support for years to come."