Boston Sci boosts structural heart biz with $75M Neovasc deal

Boston Scientific
Boston Scientific, a longtime customer of Neovasc's, is now acquiring the latter's tissue processing tech for $75 million.

Boston Scientific is plunking down $75 million in cash to acquire Neovasc’s tissue processing technology, which it will integrate into its structural heart unit. The tech produces components used in transcatheter heart valves, such as Boston Sci’s Lotus.

Vancouver-based Neovasc is working on a pair of cardiac devices as well as selling advanced biological tissue to companies like Boston Scientific. Its Tiara transcatheter device for the treatment of severe mitral regurgitation is still in development, while its Reducer device for refractory angina is approved in the European Union.

Under the deal, Boston Scientific will pick up Neovasc’s tissue processing technology and production facility for about $68 million and 15% equity for about $7 million, Neovasc said in a statement. The deal is slated to close by the end of the year.

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"We continually seek ways to optimize our manufacturing processes and enhance our product portfolio," said Ed Mackey, Boston Scientific executive vice president of operations, in a statement. "The vertically integrated operational capabilities resulting from this acquisition will strengthen our structural heart pipeline and immediately benefit our Lotus valve platform as we work to increase our market share in Europe and prepare for launch in the U.S., expected in late 2017." Boston Sci’s Lotus Valve System earned a CE mark in 2013, and its next-gen Lotus Edge Valve System followed suit in September this year.

While Neovasc is offloading its tissue processing capabilities, the purchase agreement includes a license to the assets and access to the sold production site so the company may continue developing its own tissue-related products, according to the statement. The $75 million will go toward “general corporate purposes,” Neovasc said.

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