The acquisition, which is anticipated to close in early October 2011 subject to certain closing conditions, provides that Varian will pay approximately US$10 million for Calypso plus potential earnouts based on unit sales of Calypso products achieved beyond thresholds over the next 30 months.

“With Calypso’s technology, Varian will be able to offer cancer treatment centers real-time, nonionizing tumor tracking tools for enhancing the precision of their treatments,” said Timothy E. Guertin, president and CEO of Varian Medical Systems. “These products are a perfect complement for Varian’s motion management technology, including our TrueBeam platform, respiratory gating and dynamic imaging tools for highly focused radiosurgery. These products should enhance Varian’s growth as we integrate them and make them more broadly available to the clinical community through our global marketing and sales channels.”

The Calypso system features global positioning system (GPS) for the Body technology and Beacon electromagnetic transponders that together currently provide a solution to track continuously and accurately target location to improve precision of prostate cancer treatments. The transponders are implanted into the prostate or prostatic bed and then tracked with the 4D localization and tracking system so that beams can be precisely delivered to targeted tumors during radiotherapy and radiosurgery with medical linear accelerators such as Varian’s TrueBeam platform. “The confidence gained from this system supports accelerated, hypofractionated treatments of the prostate where dose escalation requires confirmation of target location at all times,” said Mr. Guertin. “We believe this technology could support a change in clinical practice to broader acceptance and use of radiosurgery for treating prostate cancer.”

The US Food and Drug Administration (FDA) also has granted Calypso investigational device exemption (IDE) approval for its clinical study evaluating real-time tracking of lung cancer tumors during radiation delivery. This study utilizes a proprietary transponder that includes an anchoring feature uniquely designed to lock into lung tissue to support very precise radiosurgery procedures. “If cleared by regulatory authorities, we are optimistic that this will globally impact the ability to target challenging lung tumors with accuracy and precision required to advance clinical outcomes,” said Mr. Guertin.

“We are extremely gratified by the confidence and promise of this acquisition by Varian. It provides a tremendous opportunity to leverage our GPS for the Body technology as broadly as possible,” said Edward Vertatschitsch, PhD, president and CEO of Calypso Medical. “Motion management is critical to accurately targeting the cancer so patients can experience the curative benefits of radiation therapy while protecting adjacent healthy tissue. We believe our real-time tracking capabilities will help to close the gap on this clinical challenge and I look forward to joining the Varian team to advance innovations in these areas.”

“We are looking forward to having some of the world’s technical thought leaders in tumor tracking from Calypso join with us so that we can work together to develop and deploy this technology for more disease sites,” Mr. Guertin added.

The Calypso business currently generates more than $15 million in annual revenues from sales and service of its products. Calypso currently has an installed base of more than 110 systems in North America and Europe. The tracking system has been used in the treatment of an estimated 10,000 patients for cancer of the prostate.

It is expected that the Calypso business will be incorporated into Varian’s oncology systems segment and that it will continue to operate in Seattle. The acquisition includes Calypso’s intellectual property portfolio with some 90 current or pending patents.

Varian Medical Systems is a world-leading manufacturer of medical devices and software for treating cancer and other medical conditions with radiotherapy, radiosurgery, and brachytherapy. The company supplies informatics software for managing comprehensive cancer clinics, radiotherapy centers and medical oncology practices.

Calypso Medical’s proprietary tumor localization system is designed for body-wide tumors typically treated with radiation. Utilizing miniaturized, nonionizing implanted devices called Beacon electromagnetic transponders, the Calypso system continuously and accurately tracks the location of cancerous tumors for the improved precision and safe management of radiation for cancer treatment. The real-time position and motion data provided by the Calypso system offer objective reassurance that radiation treatment is delivered precisely to the prescribed target and not to surrounding healthy tissue, thereby improving safety and eliminating unnecessary radiation exposure to patients.

Related Links:
Varian Medical Systems
Calypso Medical Technologies