OraSure Technologies Inc. of Bethlehem has sold its cryosurgical systems business to another Bethlehem biotechnology firm, CryoConcepts LP, for $12 million.
The sale includes OraSure’s professional Histofreezer product line and several private label cryosurgical products sold in the consumer market, along with related patents and trademarks, customer contracts and goodwill associated with the business.
Sam Niedbala, CEO of CryoConcepts, said the two companies have a history together and that two of CryoConcepts’ three principals came from OraSure.
Niedbala said that he was among the original developers of the Histofreezer product when he was with OraSure’s predecessor, STC Technologies.
He said Histofreeze is now a product more in line with his CryoConcepts’ offerings than OraSure, which is best known for its rapid tests for the detection of antibodies to HIV and Hepatitis.
“Our business is in cryosurgery so this is a perfect fit for us and is an avenue for us to grow,” Niedbala said.
Stephen Tang, president and CEO of OraSure said the sale will allow his company to concentrate on its core business.
Tang noted that of the $185 million in revenue OraSure had in 2018, its cryosurgical systems business made up only $10.7 million of that and that was down from $12.2 million the year prior.
Tang said the company has a goal for double digit revenue growth for its business segments and cryosurgical wasn’t providing that.
“It wasn’t part of our core innovation and growth strategy,” he said. “The sale will allow us to focus on the businesses that are part of our core…the Molecular Solutions and Infectious Disease businesses.”
Tang said part of that core growth strategy is expected to be through strategic acquisition and the $12 million it received from the sale will help OraSure with that strategy.
“There are many things in the works. The pipeline for acquisition has never been more robust,” he said.
He also noted that he was happy to see the business segment go to another Lehigh Valley company and that he had confidence that the management of CryoConcepts had the expertise and strategy to grow the business.
Niedbala further commented on his plans for Histofreezer.
“Our plan is to leverage the Histofreezer brand to accelerate our introduction of a new generation of cryosurgical products to the professional and consumer markets on a global basis,” he said.
The Histofreezer line is manufactured in New York, but Niedbala said it is taking on sales people from OraSure and expects to add new positions in quality and regulatory control. He also noted that CryoConcepts does have manufacturing in the Lehigh Valley that could expand as part of this acquisition.