Boston Scientific to acquire Minnesota heart company for $1.2B
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Boston Scientific's Marlborough headquarters
Marlborough medical device manufacturer Boston Scientific has entered into an agreement to purchase a Minnesota mobile cardiac health company for up to $1.2 billion, although due to stock ownership the final price is likely to be closer to $275 million.
The transaction consists of an upfront cash payment of $925 million, and up to an additional $300 million in a potential commercial milestone payment. However, Boston Scientific has been an investor in Preventice since 2015 and currently holds an equity stake of approximately 22%, which is expected to result in a net payment of approximately $720 million upon the deal closing and a milestone payment of up to approximately $230 million.
The Preventice product portfolio includes the BodyGuardian family of remote, wearable cardiac monitors for adult and pediatric patients. The company recorded net sales of $158 million in 2020 – a 30% growth rate from the previous year, according to Boston Scientific.
"This acquisition will provide Boston Scientific with a foothold in the high-growth ambulatory electrocardiography space, which strongly complements our recent entrance into the implantable cardiac monitor market and will serve as an important component of our category leadership strategy in cardiac diagnostics and services – a nearly $2B market anticipated to grow double digits annually," Scott Olson, senior vice president and president, Rhythm Management, Boston Scientific, said in the release.
The acquisition is projected to close by mid-2021, subject to customary closing conditions, and to be immaterial to adjusted earnings per share in 2021.
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