Boston Scientific ($BSX) has agreed to buy Rhythmia Medical for $90 million up front and up to $175 million in milestones, giving the company a foothold in the growing field of electrophysiology.
Rhythmia is a privately held developer of cardiac mapping technologies that simplify procedures for cardiac catheter ablations and treatments for atrial fibrillation and atrial flutter. Boston Sci says the acquisition gives it an entry into the growing field of electrophysiology, which it says is worth $2.5 billion worldwide and growing at a double-digit pace.
"Rhythmia Medical has a strong and impressive team, and its technology is expected to add innovation and breadth to Boston Scientific's suite of solutions in this strategically important space," CEO Hank Kucheman said in a statement.
Under the deal, expected to close Friday, Rhythmia gets $90 million now, and the remaining $175 million will be meted out depending on FDA clearance, CE mark receipt and sales figures through 2017.
As a Piper Jaffray analyst tells MedCity News, the acquisition helps Boston Sci play catch-up with competitors like Johnson and Johnson ($JNJ) and St. Jude Medical ($STJ), who already have mapping and navigational technologies to augment their stables of catheters. Developing similar tech internally would be time-consuming, Thomas Gunderson told the website, and buying Rythmia gives Boston Sci a readymade platform in a high-growth segment.
All of this falls in line with Kucheman's plan to dig Boston Sci out of its of-late earnings hole. The company reported a $3.4 billion loss in the last quarter amid slumping sales in its cardiac units, and Kucheman said the way out is through, building on the device giant's strengths and unveiling a suite of innovative products. Since then, he's followed through, as Boston Sci has snagged approvals for in-demand devices such as the novel S-ICD and plugged holes with M&A.
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