Advanced Tissue, Smith & Nephew plc. deal

The companies agreed to form a 50/50 joint venture to commercialize worldwide ATIS's Dermagraft, a human tissue engineered dermal replacement product to treat diabetic foot ulcers. Smith & Nephew paid ATIS a $10 million up-front fee and could pay up to $60 million for milestones. Smith & Nephew also agreed to make loan advances to ATIS of up to $10 million in 1997 at ATIS's discretion. The companies will share equally in the revenue and expenses beginning Jan. 1, 1997.

The joint venture will have a right of first refusal to develop Dermagraft for other indications, such as pressure ulcers. ATIS retains the right to develop Dermagraft for burns and for plastic and reconstructive surgery. ...