By Connor Hart
Pacira BioSciences said it agreed to sell its ioveradeg business to Zimmer Biomet for up to $140 million.
The ioveradeg system is drug-free medical device, cleared by the Food and Drug Administration, that relieves pain via cryoneurolysis--a process whereby focused cold therapy is applied to a targeted nerve, temporarily interrupting its ability to transmit pain signals, according to Pacira.
Pacira Chief Executive Frank Lee said the divestiture supports Pacira's five-year growth plan to transition into a biopharmaceutical company specializing in musculoskeletal pain and adjacencies. He added that Zimmer Biomet's global scale and established position in the medical-device industry can better unlock the pain-relief platform's full potential.
Under the terms of the sale, Pacira would receive an upfront payment of $70 million, as well as potential future revenue-based milestone payments totaling up to an additional $70 million through Dec. 31, 2031.
Pacira intends to use proceeds from the sale to strengthen its balance sheet, including by paying down debt.
Zimmer Biomet is set to receive all of Pacira's rights, titles and interests for the development, manufacture and commercialization of ioveradeg, the company said.
The deal is expected to close in the third quarter.
Pacira shares were up 3.8% to $26.05 in premarket trading.
Write to Connor Hart at connor.hart@wsj.com