St. Jude Medical ($STJ) finalized its acquisition of interventional pain management therapy manufacturer NeuroTherm, gaining ground in a highly competitive neuromodulation market and expanding its chronic pain portfolio.
The Minnesota device giant in July said it would purchase NeuroTherm for approximately $200 million in cash to get its hands on the company's radiofrequency ablation (RFA) technology, a minimally invasive procedure that reduces chronic pain by targeting painful nerves in the neck and back. St. Jude already boasts a number of products in its arsenal, including spinal cord stimulation implants for pain treatment and its next-generation Prodigy neurostimulator, a device that uses burst stimulation in addition to standard tonic stimulation to treat patients with chronic pain. The company launched a clinical trial for the device in December and won CE mark approval for its product earlier this year.
St. Jude expects the purchase to add $10 million to $15 million to its 2014 sales, it said in a statement at the time the deal was announced. The acquisition could also provide a welcome boost in revenue, as product sales for the company's neuromodulation unit fell 1% to $107 million in Q2 2014. During a second-quarter earnings call, CEO Daniel Starks emphasized that the company was "on track" to renew growth of its neuromodulation business through regulatory approvals and new acquisitions.
The company is no stranger to chronic pain M&A; last year, St. Jude invested $40 million with an option to buy in Spinal Modulation, a California outfit with a neurostimulator system to treat lower limb pain. The device targets the dorsal root ganglion in the spinal cord and uses 95% less energy than traditional neuromodulation implants.
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| St. Jude COO Michael Rousseau |
"Over the last year, we have launched two novel neuromodulation products, made a strategic investment in Spinal Modulation, and initiated two multi-center, randomized clinical studies to evaluate alternatives for patients living with chronic pain," St. Jude COO Michael Rousseau said in a statement. "This acquisition further demonstrates St. Jude Medical's commitment to our chronic pain program and our steadfast focus on improving patient outcomes."
Meanwhile, other devicemakers are hopping on the bandwagon and developing innovative products to treat chronic pain. Last year, Medtronic ($MDT) launched a large-scale study to expand an FDA indication for its subcutaneous nerve stimulation device for chronic back pain and charted advances with its deep brain stimulation (DBS) system to treat Parkinson's disease. In June 2013, Boston Scientific ($BSX) kicked off a large-scale trial of its deep-brain stimulator system for Parkinson's disease. The device is already CE-marked and delivered a 60% average improvement in motor function in 40 patients with 100% implant success in 6-month data from a previous trial.
- read St. Jude's statement
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