Big pharma co buys $16.6bn for heart tech company
Johnson & Johnson (J&J) has agreed to acquire Abiomed, a cardiovascular medical technology company, for $16.6 billion.
According to the press release issued by J&J, the deal will broaden the company’s position as a “growing cardiovascular innovator” and help to advance the standard of care for heart failure and recovery. Cardiovascular disease is the number one cause of death.
Joaquin Duato, CEO of J&J, said: “The addition of Abiomed is an important step in the execution of our strategic priorities and our vision for the new Johnson & Johnson focused on pharmaceutical and medtech.
“We have committed to enhancing our position in medtech by entering high-growth segments. The addition of Abiomed provides a strategic platform to advance breakthrough treatments in cardiovascular disease and helps more patients around the world while driving value for our shareholders.”
Based in Massachusetts, Abiomed provides medical technology that provides circulatory support and oxygenation.
According to the statement, the acquisition gives J&J access to Abiomed’s Impella heart pumps, which have exclusive Food and Drug Administration approvals for patients with severe coronary artery disease requiring high-risk percutaneous coronary intervention, treatment of acute myocardial infarction cardiogenic shock, or right heart failure.
J&J expects that the deal will accelerate near- and long-term sales and earnings growth. The company said that the transaction will be slightly dilutive to neutral to adjusted earnings per share in the first year, considering the impact of financing, and then accretive by approximately $0.05 in 2024, and increasingly accretive after this.
Michael Minogue, Abiomed’s chairman, president and CEO, said: “We are pleased to have reached an agreement that reflects the remarkable value Abiomed created with our revolutionary Impella heart pump platform and promising pipeline.
"This transaction partners us with an organisation that shares our patients-first mindset and creates immediate value for our patients, customers, employees and shareholders. It will enable us to leverage Johnson & Johnson’s global scale, commercial strength and clinical expertise to accelerate our mission of making heart recovery the global standard of care.”
Following the completion of the transaction, Abiomed will operate as a standalone business within J&J medtech. The transaction has been approved by both companies’ boards of directors but awaits regulatory approval.
The deal comes one year after J&J announced plans last year to spin off its consumer products division, while refocusing efforts on biopharmaceutical and medical device innovation and technology.
