CYNOSURE INC (CYNO) SPO
|Company Name||CYNOSURE INC|
|Company Address||5 CARLISLE ROAD
WESTFORD, MA 01886
|Company Phone||(978) 256-4200|
|CEO||Michael R. Davin|
|Employees (as of 12/31/2011)||346|
|State of Inc||--|
|Fiscal Year End||12/31|
|Exchange||Nasdaq National Market|
|Shares Over Alloted||0|
|Shareholder Shares Offered||600,000|
|Lockup Period (days)||180|
|Quiet Period Expiration||12/24/2012|
We estimate that the net proceeds we will receive from this offering will be approximately $66.08 million, after deducting the underwriting discounts and commissions and estimated offering expenses payable by us. If Leerink exercises its over-allotment option in full, we estimate that the net proceeds to us will be approximately $72.22 million, after deducting the underwriting discounts and commissions and estimated offering expenses payable by us. We intend to use the net proceeds to us from this offering for general corporate purposes and to fund our potential acquisition of complementary products, technologies or businesses. While acquisitions are an important element of our growth strategy, and at any given time we are likely to be evaluating, and may be in discussions with third parties regarding, both small and substantial acquisitions, we currently have no agreements or commitments to complete any such transactions. We will not receive any proceeds from the sale of shares of class A common stock in the offering by El.En. under this prospectus supplement and the accompanying prospectus. El.En. will pay any underwriting discounts and commissions and expenses that it incurs for brokerage, accounting, tax or legal services or any other expenses incurred by El.En. in disposing of shares of class A common stock in this offering. We will pay all other expenses of this offering.
Competition in the aesthetic laser industry is intense. Our products compete against products offered by public companies, such as Cutera, Inc., Palomar Medical Technologies, Inc., Solta Medical, Inc., Syneron Medical Ltd., and ZELTIQ Aesthetics, Inc., as well as several smaller specialized private companies, such as Alma Lasers, Ltd. Some of these competitors have greater financial and human resources than we do and have established reputations, as well as worldwide distribution channels and sales and marketing capabilities that are larger and more established than ours. Additional competitors may enter the market, and we are likely to compete with new companies in the future. We also face competition against non-light-based medical products, such as BOTOX® and collagen injections, and surgical and non-surgical aesthetic procedures, such as face lifts, chemical peels, abdominoplasty, liposuction, microdermabrasion, sclerotherapy and electrolysis. We may also face competition from manufacturers of pharmaceutical and other products that have not yet been developed. As a result of competition with our competitor companies, products and procedures, we could experience loss of market share and decreasing revenue as well as reduced prices and profit margins, any of which would harm our business and operating results. Our ability to compete effectively depends upon our ability to distinguish our company and our products from our competitors and their products. Factors affecting our competitive position include: . product performance and design; . ability to sell products tailored to meet the applications needs of clients and patients; . quality of customer support; . product pricing; . product safety; . sales, marketing and distribution capabilities; . success and timing of new product development and introductions; and . intellectual property protection. --- El.En. is a leading laser manufacturer in Europe and a leading light-based medical device manufacturer worldwide. El.En. and its subsidiaries develop and produce laser systems with scientific, industrial, commercial and medical applications. On October 26, 2012, we entered into a new seven-year exclusive distribution agreement with El.En., which replaced our prior distribution agreements with El.En. Under this new agreement, we will purchase from El.En. its proprietary SmartLipo MPX system and its SLT II laser system. The SLT II laser system is an essential component of our SmartLipo Triplex and Cellulaze systems, which also incorporate our proprietary software and delivery systems. El.En. markets, sells, promotes and licenses other products that compete with our products, both in North America and elsewhere throughout the world, and our agreement with El.En. does not prevent El.En. from competing with us by selling products that we purchased in the past from El.En., including earlier generation SmartLipo systems. In the event that our distribution agreement with El.En. terminates, El.En. would be able to compete with us worldwide with the SmartLipo MPX system and with products containing the SLT II laser system. Our business could be materially and adversely affected by increased competition from El.En.
We develop and market aesthetic treatment systems that are used by physicians and other practitioners to perform non-invasive and minimally invasive procedures to remove hair, treat vascular and pigmented lesions, remove multi-colored tattoos, rejuvenate the skin, liquefy and remove unwanted fat
through laser lipolysis, reduce cellulite and treat onychomycosis. We sell our products through a direct sales force in North America, France, Spain, the United Kingdom, Germany, Korea, China, Japan and Mexico and through international distributors in 95 other countries. Our systems incorporate a broad range of laser and other light-based energy sources, including Alexandrite, pulse dye, Nd:Yag and diode lasers, as well as intense pulsed light. We believe that we are one of only a few companies that currently offer aesthetic treatment systems utilizing Alexandrite and pulse dye lasers, which are particularly well suited for some applications and skin types. We offer single energy source systems as well as workstations that incorporate two or more different types of lasers or pulsed light technologies. We offer multiple technologies and system alternatives at a variety of price points depending primarily on the number and type of energy sources included in the system. Our newer products are designed to be easily upgradeable to add additional energy sources and handpieces, which provides our customers with technological flexibility as they expand their practices. A key element of our business strategy is to launch innovative new products and technologies for high-growth aesthetic applications through research and development, as well as acquisitions and distribution arrangements. Over the past decade, we have introduced on average two new products per year. Recent key initiatives have included: . Establishment of Minimally Invasive Product Line. We have expanded beyond our legacy non-invasive roots by offering new minimally invasive aesthetic treatment systems, with our Smartlipo and Cellulaze workstations as our initial flagship products. We use the term “flagship products” to refer to our leading products for a particular application. . The Smartlipo system was the first FDA-cleared laser lipolysis system for use in a minimally invasive procedure for the removal of unwanted fat. Since the launch of the Smartlipo system in 2006, we have introduced two new workstations: the Smartlipo MPX workstation in 2008, which added a second wavelength laser, and the Smartlipo Triplex workstation in October 2009, which added a third wavelength laser. We have further innovated in this area with the introduction of MultiPlex technology, which enables the energy from two lasers to be blended, and SmartSense with ThermaGuide and ThermaView , our proprietary intelligent delivery systems. . In January 2012, we received FDA clearance in the United States to sell and market our Cellulaze system, the world’s first FDA-cleared minimally invasive aesthetic laser device for the reduction of cellulite. . FDA Clearance for New Home Use Device. In July 2012, we received FDA clearance in the United States to market an at-home device for the treatment of wrinkles being developed by us in partnership with Unilever. Unilever has advised us that it expects to launch the product commercially in 2013. . Development of Picosecond Technology Platform . We are developing our picosecond laser technology platform, which we believe will be the first commercially available picosecond Alexandrite aesthetic laser platform. We expect that our PicoSure system, which we are developing for multiple applications, including tattoo removal and treatment of pigmented lesions, will be our first product based on this technology platform. Picosecond lasers deliver pulses that are measured in trillionths of a second in contrast with nanosecond technology, such as our MedLite and RevLite products, which deliver pulses in billionths of a second. In clinical studies that we have conducted, the shorter pulse duration of the picosecond laser achieved increased efficiency in removing tattoo pigment, which we believe will result in fewer treatments and better overall treatment outcomes than current laser technology. We also believe this new technology is more effective in targeting blue and green pigments, more rapidly lightens other colors and improves recovery time due to less collateral injury to surrounding tissue as compared to nanosecond technology. In a clinical study of 22 patients treated with the PicoSure system over a two-week period at a single center, more than 80% overall tattoo clearance and 94% clearance of blue and green ink was achieved. We presented the results of this study at the American Society of Laser Medicine and Surgery in April 2012. We have submitted a 510(k) application for PicoSure and, subject to FDA clearance, anticipate commercialization in the first half of 2013. . Acquisitions and Distribution Rights. We have pursued acquisitions and distribution arrangements to complement our existing product offerings and increase the leverage of our global distribution network, consummating two acquisitions and one distribution transaction in 2011. In February 2011, we expanded our body shaping treatment platform by acquiring substantially all of the assets of Elemé Medical, including the non-invasive SmoothShapes XV system. In June 2011, we acquired substantially all of the assets of HOYA ConBio’s aesthetic laser business, including the MedLite C6 and RevLite systems for the treatment of wrinkles, acne scars, multi-color tattoos and vascular lesions, and overall skin rejuvenation. In October 2011, we expanded into the onychomycosis market by acquiring worldwide exclusive rights from NuvoLase, Inc. to distribute the PinPointe FootLaser , which uses laser light to kill the fungus that lies in and under the nail that causes onychomycosis without damaging the nail or the surrounding skin. ---------- We were incorporated under the laws of the State of Delaware in July 1991. Our principal executive offices are located at 5 Carlisle Road, Westford, Massachusetts 01886, and our telephone number is (978) 256-4200. Our website a ddress is www.cynosure.com.