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Cooper reenters ophthalmic surgery market
Cooper Cos. purchased AlphaCor and AlphaSphere, two ophthalmic surgery products, from Argus Biomedical.
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Cooper Cos. recently acquired two products, AlphaCor and Alpha Sphere, from developer Argus Biomedical, marking its reentry into the ophthalmic surgery market.
Cooper announced that it has formed an ophthalmic surgery business unit that will market the devices. Cooper Vision Surgical Inc. will be a wholly owned subsidiary of CooperVision Inc., the company’s contact lens business.
AlphaCor is an artificial cornea developed to be used in place of human donor tissue in some corneal transplants. AlphaSphere, a soft orbital implant, should be on the market in another 18 months, according to the company.
First step back
“The purchase of AlphaCor is our first step back into the ophthalmic surgery world. We are trying to carve out a niche market,” said Thomas Bender, chairman and chief executive officer of Cooper Companies, in an interview. “We are looking to establish ourselves with AlphaCor, which is a very small business,” he said.
The AlphaCor artificial cornea is a synthetic one-piece device designed to replace a diseased or damaged cornea or a failed human corneal graft. It was approved for marketing by U.S. regulators last year. (See the article “Corneal prosthesis can treat patients contraindicated for human graft, surgeons says,” from the December 1, 2003, issue.)
“The AlphaCor is the only alternative to donor tissue for use in corneal transplant. With only 300 to 400 specialists in the United States performing corneal transplants, you can see we are looking for a niche market and we have no intention of going head-to-head with the big surgical companies,” Mr. Bender said.
Analysts have estimated that about 100,000 corneal transplants are performed worldwide yearly and that about 20% or 20,000 of these could be candidates for AlphaCor.
Christopher C. Cooley, an industry analyst at FTN Midwest Research Securities Corp., estimated that AlphaCor addresses an existent $139 million revenue opportunity. Cooper hopes to ultimately establish AlphaCor as a new standard of care in the marketplace, Mr. Cooley said in a research report provided to Ocular Surgery News by Mr. Bender.
AlphaCor has received regulatory clearance in the United States, Australia, Europe and Canada, according to a press release from Cooper. More than 120 AlphaCor devices have been implanted worldwide, the company noted. The device is reimbured by Medicare and some private insurance plans, the company said.
AlphaSphere represents the second phase of the growth opportunity Cooper Vision Surgical expects to see, according to the company press release. The device is a soft orbital implant that will provide cosmetic benefits for a patient that loses his or her eye due to disease progression or trauma.
History
The Cooper Cos., which started in the early 1960s, is very different today from the Cooper of the early 1980s, Mr. Bender said in an interview.
“The company went through a withdrawal and was trying to survive, and in an effort to survive Cooper Vision Surgical was sold to Alcon. Cooper has become completely different since then,” Mr. Bender said. Cooper Vision is a $400 million soft contact lens business, and Cooper Surgical is $100 million gynecological office and medical device business, he said.
Cooper manufactures and markets specialty healthcare products and contact lenses through its Cooper Vision and Cooper Surgical units, with plants in California, New York, Virginia, Australia, England, Spain and Toronto.
Looking forward
According to analysts, the newly formed subsidiary will require only a limited clinical sales force to service the estimated 400 surgeons domestically that perform corneal transplant surgeries, making the artificial cornea market a low cost to serve business opportunity.
“In our opinion, the acquisition holds significant promise longer-term as it does not represent just ‘another surgical acquisition’ but a fundamentally sound use of corporate cash to acquire the foundation around which an entirely new and complementary growth-oriented ophthalmic surgical franchise may be developed,” Mr. Cooley said.
“At this time, our revenue and earnings estimates remain unchanged for fiscal 2004 and 2005 respectively. Accordingly, the prospects for the Cooper Companies’ core businesses to sustain upper-teens revenue and earnings growth are favorable, with the potential for acquisitions to further enhance revenue and earnings growth above estimates,” he added.
For Your Information:
- Thomas Bender can be reached at Cooper Companies, 21062 Bake Parkway, Suite 200, Lake Forest, CA 92630, 949-597-4700; fax: 949-768-3688; Web site: www.coopercos.com.
- Christopher C. Cooley can be reached at Midwest Research Securities, Manhattan Tower, Suite 240, 1230 Rosecrans Ave., Manhattan Beach, CA 90266; 310-643-1900.