Boston Scientific to acquire device maker Atritech in a $375 million deal
20 January 2011
Boston Scientific Corp yesterday said that it is acquiring start-up medical device maker Atritech, Inc, in a $375-million deal to broaden its portfolio of less-invasive cardiovascular devices.
Founded in 2000, Minnesota-based privately held Atritech has developed a novel device called 'Watchman' designed to close the left atrial appendage in patients with atrial fibrillation who are at risk for ischemic stroke.
The Watchman left atrial appendage closure technology, which was originally conceived by doctors at the Minneapolis Heart Institute and the Mayo Clinic, is the first device proved in a randomised clinical trial to offer an alternative to anticoagulant drugs, which are associated with an increased risk of bleeding, for patients experiencing atrial fibrillation who are at high risk for stroke.
Patients with atrial fibrillation are prone to developing blood clots in an area of the heart known as the left atrial appendage. If these clots dislodge and enter the bloodstream they may block circulation to the brain, resulting in a stroke.
The Watchman device is designed to close the left atrial appendage, thereby preventing clots within the appendage from being dislodged into the circulation.
The device has demonstrated a 38-per cent relative risk reduction for stroke, cardiovascular death and systemic embolism compared to long-term warfarin therapy.
Although the Watchman is yet to be approved by the US Food and Drug Administration (FDA), it has been approved in Europe and was has been selling outside the US since 2009. The company is currently enrolling patients in the US to undertake a confirmation study required for approval by the FDA.
The Watchman is not the only experimental devices designed to block off a portion of the heart, Plymouth-based AGA Medical was also developing a similar device, which made Canada's St. Jude Medical acquire it for nearly $1.1 billion in October last year.
Minnesota-based Medtronic, the world's second-largest medical device maker, is also developing a similar device.
Under the deal, Massachusetts-based Boston Scientific will make an upfront payment of $100 million plus additional potential payments of up to $275 million upon achieving specified regulatory and revenue-based milestones through 2015.
"The acquisition of Atritech reinforces Boston Scientific's continued commitment to providing the broadest portfolio of less-invasive devices across the continuum of cardiovascular care," said Hank Kucheman, executive vice president and group president, Cardiology, Rhythm and Vascular for Boston Scientific.
"The Watchman device is implanted by both electrophysiologists and structural heart-focused interventional cardiologists. We will leverage expertise from our Electrophysiology and Interventional Cardiology sales forces to drive commercialization of the Watchman device. Atritech will significantly strengthen our product offerings for patients with atrial fibrillation," he added.
With 2009 revenues of $8.188 billion, Boston Scientific is a developer, manufacturer and marketer of medical devices such as heart stents, pacemakers and implantable defibrillators whose products are used in a range of interventional medical specialties.
Boston Scientific is well known for the development of the Taxus Stent, a drug-eluting stent which is used to open clogged arteries.
This product was at the centre of a claim of patent infringement and the company had to pay its rival Johnson and Johnson $716 million in 2009 and $1.73 billion last year to settle the suit. (See: Boston Scientific to pay J&J $1.73 billion in patent settlement)
Boston Scientific's main competitors are Johnson & Johnson, Medtronic, and St. Jude Medical.