Medtech's Biggest Deals in 2019 ... So Far
Medtech’s Biggest Deals in 2019
In 2018, medtech companies had a great deal of cash on hand and they were eager to spend that capital on acquisitions. Boston Scientific nearly made a move to acquire a company every month. But is that the same story in 2019? Do medtech companies have the same hunger as they did in 2018? The answer is no according to Mike Matson, an analyst at Needham & Co. In a research note, Matson wrote when compared to 2018, both the "number of M&A deals and the dollar volume of deals appear likely to decline in 2019." MD+DI has compiled a list of the top medtech deals either announced or closed in 2019 based on crunchbase data, Matson’s report, and MD+DI's list of 2018 Mergers.
A Digital Acquisition
In March, Hill-Rom Holdings entered into a definitive agreement to acquire Voalte, a real-time, mobile healthcare communications specialist, for a cash consideration of $180 million and up to an additional $15 million in payments related to the achievement of certain commercial milestones. The acquisition of Voalte accelerated Hill-Rom's leadership in care communications and advances the company's digital and mobile communications platform and capabilities.
This One Was Always Coming, We Just Didn’t Know When
It was only a matter of time before Abbott Laboratories exercised its option to acquire Cephea Valve Technologies, a mitral valve company it first invested in back in 2015. Cephea's technology is being developed to provide an option for people whose diseased mitral valves need to be replaced. The artificial valve is designed to be delivered through a vein in the leg, forgoing the need for open-heart surgery. Replacement of the diseased mitral valve restores normal blood flow through the heart. Recently, Canaccord Genuity Analyst Jason Mills wrote about the growing mitral valve market. “Following the rush of strategic M&A in the transcatheter mitral repair/replacement devices (TMVR) space in 2015 – and despite a few years now in the spotlight - we still think the TMVR market is in its infancy,” Mills wrote in a research note.
Zoll Medical Strikes While The Iron Is Hot
Zoll Medical wasted little time trying to acquire TherOx. Fresh off receiving a PMA, the company swooped in to get TherOx and the SuperSaturated Oxygen (SSO2) Therapy technology. The therapy has been demonstrated to reduce infarct size after primary coronary intervention with stenting in patients with left anterior descending ST-elevation myocardial infarction. The SSO2 Therapy was greenlit in April and made MD+DI’s list of recent FDA-approved technologies.
Stryker Focuses on ENT Offerings
Stryker continued to build on its ear, nose, and throat offerings when it announced it would pick up Arrinex to add a treatment for chronic rhinitis. Arrinex has the Clarifix to give patients with chronic rhinitis an alternative to pharmacological interventions and invasive surgery. The deal came about a year after Stryker made a huge move in the space and said it would pick up ENT specialist Entellus for $662 million.
Medtronic’s ‘Epic’ Acquisition
Medtronic announced plans to expand its cardiac ablation portfolio when it said it would acquire Epix Therapeutics. The company designs and manufacturers a catheter-based, temperature-controlled cardiac ablation system for the treatment of patients with cardiac arrhythmias (irregular heartbeats.)
Looks Like There Was More Liquid Biopsy M&A on the Way
Nearly a year ago, MD+DI asked the question “Is there more liquid biopsy M&A on the way?” Well, the answer was yes, and it came in the form of one of the space’s biggest players – Guardant Health. The Redwood City, CA-based company pick up Bellwether Bio, a private company focused on improving oncology patient care through pioneering research into the epigenomic content of cell-free DNA. Bellwether Bio was Guardant Health’s first acquisition as a public company.
Don’t Forget Medtronic Has a Strong Presence in Orthopedics Too
In May, Medtronic announced it was acquiring Titan Spine. Mequon, WI-based Titan Spine markets a full line of Endoskeleton interbody devices featuring its textured surface in the U.S., Europe, and Australia through its sales force and a network of independent distributors. But what makes this deal so significant is the fact it comes on the heels of Medtronic’s rival Boston Scientific making a high profile acquisition in orthopedics, through the purchase of Vertiflex for $465 million. Was this a countermeasure or coincidence?
Boston Scientific Beats the M&A Drum Again in 2019
You could probably argue that 2018 was one of the biggest years for Boston Scientific – based on the sheer number of acquisitions the company announced and made. Yet, surprisingly the Marlborough, MA-based company has been relatively quiet on the M&A front. In May, the firm began beating on its M&A drum again, agreeing to pay $465 million in upfront cash for Vertiflex, plus additional payments contingent on certain commercial milestones over the next three years. Carlsbad, CA-based Vertiflex sells the Superion Indirect Decompression System, a device designed to improve physical function and reduce pain in patients with lumbar spinal stenosis.
Edwards' Focus is on More Than Just TAVR
Edwards Lifesciences will always be known as the undisputed pioneer of transcatheter aortic valve replacement devices. However, that’s not the entire focus of the Irvine, CA-based company. In February, Edwards made a move to acquire Cas Medical Systems for about $100 million. Branford, CT-based Cas Medical specializes in the non-invasive monitoring of tissue oxygenation in the brain. Cas Medical’s FORE-SIGHT sensor is compatible with Edwards’ HemoSphere advanced hemodynamic monitoring platform. Cas Medical’s FORE-SIGHT could continue to boost HemoSphere, which pushed growth in the firm’s critical care unit during 4Q18.
Finally… Fresenius Has Acquired NxStage
Now to be fair, this $2 billion-deal began in 2017. But due to a series of twists and turns (antitrust laws), Fresenius didn’t actually complete the acquisition of NxStage until February of this year! NxStage makes medical devices for home dialysis and critical care.
Johnson & Johnson’s Auris Deal Takes Surgical Robotics to a New Level
Surgical robotics is one of the hottest spaces in medtech. It is also one of the areas that are wide open for M&A. Johnson & Johnson seized on this opportunity and acquired Auris Health for $3.4 billion. Redwood City, CA-based Auris Health developed the Monarch Platform, an FDA cleared system currently used in bronchoscopic diagnostic and therapeutic procedures. The deal helped boost J&J’s position in surgical robotics – a space it was already making significant progress in due to its Verb joint venture with Verily Lifesciences.