Investors are looking for medical device companies that could serve as an alternative to drugs for disease treatments.
The idea isn't without precedent, as The Wall Street Journal's "The Source" blog notes in its highlight of a story from Dow Jones Banking Intelligence.
Back in the day, Ardian developed a minimally invasive renal denervation to treat hypertension, using radiofrequency energy delivered through a special catheter to sever renal nerves, a big advance on more invasive and risky surgical options and a major alternative to drug treatment. Medtronic ($MDT) invested in the company back in 2009 and later acquired it in full in 2010 for $800 million up front, plus milestone payments that point toward $1 billion. (A major pharmaceutical company was also a bidder.)
Score for Morganthaler Ventures and Advanced Technology Ventures, both of which were among the company's initial investors. And now both are actively looking to invest in medical device companies whose signature products can do the same job as drugs in a given indication. Medtronic/Ardian is a lucrative example as to why. Simply put, it demonstrated that investors could increase exit strategy options by drawing bidders from both the medical device and drug company spaces.
And in the increasingly difficult struggle to fill the pipeline with next-generation drug treatments, if a device could do the same job, then why not?
- read the blog item