St. Jude Medical on Wednesday said it will pay $375 million to acquire CardioMEMS and its device to help manage heart failure.
The purchase—one of the largest medtech acquisitions so far this year—is expected to close by the end of June, and comes amid U.S. FDA approval of the CardioMEMS HF System.
The device is about the size of a dime and is implanted in the pulmonary artery during a minimally invasive procedure. It can transmit information about pulmonary artery pressure from a patient’s home to a health provider. Increased pressure in the artery is an early warning of worsening heart failure.
Catching a rise in pulmonary artery pressure allows doctors to proactively manage medications and other treatment options, decreasing the likelihood of hospital admission. Odd are, that’s an attractive value proposition for U.S. health systems, especially since Obamacare has Medicare increasingly reimbursing based on how overall patient populations are managed. Public relations for St. Jude noted that heart failure costs the United States $31 billion annually, an amount expected to more than double to $70 billion by 2030.
“I believe this strategy has the potential over time to change heart failure. Not just to lighten the burdens every day or to decrease the number of hospitalizations, but to decrease the grim progression of the disease,” Lynne Warner Stevenson, MD, director of the Heart Failure Program at Brigham and Women’s Hospital in Boston, said in a St. Jude Medical news release.
St. Jude Medical demonstrated its interest in the technology in late 2010, when it invested $60 million for 19 percent ownership of CardioMEMS, along with an exclusive option to buy the rest of the company down the road.
The CardioMEMS acquisition is large. But at least a handful of other purchases announced this year, such as Zimmer Holdings' plans for the $13.35 billion acquisition of Biomet, are in the multibillion-dollar range. Just on Wednesday, Valeant Pharmaceuticals International upped its bid for Allergen to an amount estimated to be over $50 billion, though the maker of the popular Botox cosmetic treatment as well as a number of medical devices has been stony-faced so far over Valeant's overtures.
"The BioMEMS market is expected to grow rapidly, from $1.9B in 2012 to $6.6B in 2018! Microsystems integration is fast becoming a key added-value for system manufacturers", analysed Benjamin Roussel, MedTech activity leader at Yole Développement, in his report BioMEMS.
Refresh your medical device industry knowledge with Yole Développement report on BioMEMS ! More information here