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| Spetzler Malis disposable forceps--Courtesy of Depuy Synthes |
Stryker ($SYK) announced a tuck-in acquisition, saying it has agreed to acquire all of the assets in Synergetics USA's neurology portfolio, which achieved sales of $31 million in 2015. The move will give the company access to at least two electrosurgical devices that are currently distributed by rival Johnson & Johnson ($JNJ).
Synergetics was acquired by Valeant in October 2015 for up to $190 million. The sale of its neurology portfolio will free the O'Fallon, MO company to focus on ophthalmology devices like diamond dusted membrane scrapers and laser probes used by retinal surgeons.
Upon the transaction's closure in Q1 2016, Synergetics will no longer manufacture the Spetzler Malis disposable forceps and Malis Bipolar Electrosurgical Generator on behalf of Johnson & Johnson's Codman Neuro franchise. The forceps are single-use devices intended for coagulation of tissue during electrosurgery, while the electrosurgical generator is for "endoscopic bipolar cutting and coagulation of tissue and sealing of blood vessels in all types of surgery," according to the product website.
In addition, the portfolio of assets to be acquired includes those related to Stryker's MultiGen radiofrequency generator for the coagulation of soft tissue in orthopedic, spinal and neurosurgical applications, as well as tips used in Sonopet Ultrasonic Aspirator for fine bone dissection. Both devices are owned by Stryker, but were sponsored by Synergetics during the regulatory process, according to the FDA's 510(k) database. The assets to be transferred to Stryker could be intellectual property in this case.
"The acquisition of the Synergetics neuro portfolio is highly complementary to Stryker instruments' neuro spine & ENT (NSE) business and is aligned with NSE's strategy of expanding its neurosurgical product offering," said Timothy Scannell the group president of Stryker's medical surgery and neurotechnology businesses, in a statement.
The company's neurotechnology and spine devices had revenues of $1.8 billion in 2015, up 5% year-over-year (and 9.5% when excluding exchange rate fluctuations).
Meanwhile, Johnson & Johnson's device footprint will shrink as a result of the deal. The company recently announced that it is axing approximately 3,000 jobs in its slowing-growing medical devices division in an effort to save up to $1 billion in costs by 2018.
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