DePuy (a JNJ company) Buys CrossRoads Extremity Systems

Memphis, Tennessee-based venture capital firm MB Venture Partners (MBVP) and New York based-Healthpoint Capital announced that one of their portfolio companies, CrossRoads Extremity Systems, has been sold to Raynham, Massachusetts-based DePuy Synthes, a Johnson & Johnson company. Terms were not disclosed.

CrossRoads Extremities is the latest in a long line of very successful Memphis-based musculoskeletal companies to be acquired by one of the major suppliers of musculoskeletal products. CrossRoads was founded just eight years ago, in 2014, by three medical device engineers—Glen Coleman, Vernon Hartdegen, and Chad Hollis. Their vision was to work closely with foot and ankle surgeons to develop and manufacture “procedure-specific, sterile-packed implants and instruments for elective foot and ankle surgery.”

In just a few years, the company developed a full line of innovative products, including the dynaBunion^® Lapidus system, miniBunion^®, and DynaForce^® Staple Compression Plates™. CrossRoads also offers EcoSMART^®, its proprietary instrument management system which delivers “instruments to surgery in small, pre-sterilized instrument kits.” After surgery, the instruments are returned to CrossRoads to be reprocessed and are then sent out in sterile kits to be reused in surgery.

Memphis-based MB Venture Partners (MBVP), headed up by long-time investment banker and industry veteran, Gary Stevenson, made the initial investment in CrossRoads. From 2014 to 2018, MBVP was CrossRoads’ lead and largest investor and organized four financing rounds for the company. As a direct result of Stevenson’s tireless support, the company was able to develop and grow its foot and ankle product portfolio and, most importantly, provide solutions to difficult musculoskeletal problems and improving patient care to the tune of more than 25,000 surgeries.

In 2019, New York, New York-based Healthpoint Capital, a private equity firm focused exclusively on musculoskeletal healthcare, finalized a “combination buyout and growth capital financing with CrossRoads.” This funding was used to ramp up commercialization.

MB Venture’s Stevenson told OTW, “We’re glad we chose to be one of their [CrossRoads] financing partners. Management execution has been crisp from the start, but especially in the last two years overcoming the stiff headwinds from COVID and supply chain constraints. Along the way, we’ve done our fair share to help the company including attracting capital from other investors, especially the significant 2019 financing with Healthpoint Capital.”

Finally, said Stevenson, “This JNJ [Johnson & Johnson] transaction will provide a meaningful return to all CrossRoads investors. We’re very pleased with this outcome.’’

Masterful execution all around and a great boon for patients and, we hope, DePuy Synthes.