ConTIPI has been acquired by Procter & Gamble for $100 million. The start-up, which develops disposable vaginal devices that reduce or prevent urinary incontinence, has signed an agreement to be sold which will be implemented in stages. ConTIPI will receive $15 million in cash immediately, and, depending on milestone payments, could receive up to $100 million from Procter & Gamble. To receive the maximum payment, ConTIPI's products must reach annual revenue of over $180 million.
ConTIPI and Procter & Gamble have had a distribution agreement since 2007 based on royalties, which has so far been worth tens of millions of dollars. The current agreement will replace the distribution agreement, although many of the clauses in the agreement are similar. ConTIPI declined to comment on the report.
The joint business activities between ConTIPI and Procter & Gamble are in their formative stages with pilot projects in a number of countries. ConTIPI's product has approval from the US Food & Drug Administration (FDA) but is not yet being marketed in the US. The product will be launched in 2011.
ConTIPI is exceptional in Israel's biomed landscape, because its device will be sold as a consumer product in pharmacies without the need of a prescription, although with a doctor's recommendation. Entering this market independently would be very difficult and require enormous marketing resources.
ConTIPI was founded in 2002 and is based in Caesarea. It has raised $3 million to date.
Published by Globes, Israel business news - www.globes-online.com - on September 16, 2010
© Copyright of Globes Publisher Itonut (1983) Ltd. 2010