Medtronic jumps into hemodialysis business through India partnership

Medtronic ($MDT) will link with one of India's largest healthcare providers to develop a portable kidney dialysis system, its first foray into hemodialysis and yet another diversification move for the Minnesota device giant.

The deal involves a partnership with India's Apollo Hospitals Enterprise, which maintains over 8,500 beds across 51 hospitals, 1,350-plus pharmacies and more than 100 diagnostic clinics, according to the company. Medtronic said it will invest $25 million in the initial effort and establish a research team in India to focus on designing, developing and manufacturing crucial parts of the system there. Plans call for rolling out a finished product by 2016, with an eye on treating patients with end-stage renal disease who need renal replacement therapy.

Ven Manda, vice president of science, technology and new therapies at Medtronic, told Bloomberg that the idea is to develop a new approach to hemodialysis that will be low-cost, portable and functional in the developing world, where access to hemodialysis treatments can be harder to come by, because the machines require lots of water and infrastructure not always found in many healthcare facilities.

On one level, Medtronic's foray into hemodialysis is a direct challenge to dialysis device makers such as Fresenius Medical Care ($FMS) and Baxter ($BAX). But Manda explained in the story that those companies tend to focus more on developed countries such as the U.S. and Europe. 

Omar Ishrak, Medtronic's chairman and CEO, said in a statement that the hemodialysis system will be built to function with the unique healthcare environment in the developing world.

"Our goal is to build a unique, internally developed system that will be portable, will lower costs, and will be more efficient in its use of water and other critical features than existing dialysis systems," Ishrak said. "Our collaboration with Apollo allows us to further tailor our system to best meet the needs of patients and physicians in India and will leverage Apollo's deep expertise and reach in treating end-stage renal disease patients."

Medtronic, which has focused its expansion, in part, on emerging markets, is right to target India, which is one of the world's largest. As the company notes, nearly 75 million people in the country face chronic kidney disease, with 200,000 requiring dialysis or kidney transplant annually. And the company would also gain a cost-effective hemodialysis device it could presumably market elsewhere. That's not a bad deal for Medtronic, which is the world's largest maker of heart rhythm devices. As it continues to diversify into other products and areas such as health services, it will be known for a whole lot more in the future.

- here's the release
- check out Bloomberg's take

Suggested Articles

Dexcom received a new European approval for its wearable continuous glucose monitor in pregnant women across Type 1, Type 2 and gestational diabetes.

Infectious disease blood tester Karius has raised $165 million led by SoftBank’s Vision Fund 2, the Japanese conglomerate’s sequel to its VC megafund.

BD will begin working with Babson Diagnostics to help bring its lab-quality device for collecting blood from capillaries into retail pharmacies.