J&J's Ethicon to buy NeuWave for soft-tissue microwave ablation for cancer

Neuwave Medical's Certus 140 thermal ablation system--Courtesy of Neuwave Medical

Johnson & Johnson ($JNJ) made big promises to pursue innovative device deals after it did a major restructuring of the business early this year. It's working to make good on that strategy with its latest acquisition of NeuWave Medical, which J&J noted already has its soft tissue microwave ablation tech in place in more than half of the top cancer centers in the U.S.

NeuWave's microwave ablation delivers focused heat to eliminate, or ablate, lesions in the body. Antennas, or probes, are placed directly into the lesion and emit microwave energy from their tip to rapidly oscillate water molecules within the lesion. This causes friction and heat, thereby destroying the lesion while protecting tissue that was not targeted.

"We continue to work to push the boundaries of access and treatment for patients for whom traditional surgery may not be an option today," said Michael del Prado, group company chairman of Ethicon, in a statement. "The market-leading technology and expertise that NeuWave Medical has developed is minimally invasive and can be combined with other therapies to improve outcomes for patients. Additionally, for healthcare systems, this offering can potentially translate to a lower overall financial burden as well."

The pair kept mum on the financial details of the acquisition, but not too much cash has gone into NeuWave. It's most recent financing was a $25 million Series C financing that was led by Versant Ventures with participation from all existing investors including H.I.G. BioVentures and Venture Investors.

That round brought NeuWave's equity-only investment to a total of roughly $55 million, according to SEC filings; but the Madison, WI-based startup also did a series of smaller mixed equity and debt financings since it was founded in 2004 by University of Wisconsin-Madison radiologist and biomedical engineer Fred Lee.

The acquisition is expected to close in the second quarter. NeuWave President and CEO Dan Sullivan is no stranger to the art of the medical device acquisition. He previously led minimally invasive lung biopsy company SuperDimension, which Covidien bought in 2012 for $300 million plus earn-outs. He was also VP of Sales at Scimed Life Systems, which Boston Scientific ($BSX) bought for more than $865 million in 1995.

- here is the announcement