A Medical Device Daily
Johnson & Johnson (J&J; New Brunswick, New Jersey) has agreed to acquire a California-based company that supplies medical products to the aesthetic market for roughly $1.07 billion in a cash tender offer. Mentor (Santa Barbara, California) is expected to operate as a stand-alone business unit reporting through Ethicon (Somerville, New Jersey).
J&J agreed to buy all outstanding shares of Mentor at $31 a share. The tender offer is conditioned on the tender of a majority of the outstanding shares of Mentor's common stock on a fully diluted basis. The closing is conditioned on clearance under the Hart-Scott-Rodino Antitrust Improvements Act, and other customary closing conditions. The $1.12 billion estimated net value of the transaction is based on Mentor's 34.6 million fully diluted shares outstanding, plus estimated net debt at time of closing. The boards of both companies have approved the transaction.
J&J said the acquisition of Mentor would provide Ethicon with an opportunity to strengthen its presence in aesthetic and reconstructive medicine and "raise the standard for innovation and patient outcomes in this market worldwide."
"The addition of Mentor, a market-leader and one of the most respected companies in the aesthetic space, expands our capacity to provide physicians with products that can restore patients' appearance, self-esteem and quality of life," said Alex Gorsky, company group chairman for J&J with responsibility for the Ethicon business. "Ethicon is a company that is committed to bringing evidence-based medicine and the highest standards of quality to the aesthetic and reconstructive medical device category. Mentor also shares that commitment to science, health and wellness."
Upon closing, the transaction is expected to have a dilutive impact to J&J's 2009 earnings per share of roughly 3 cents to 5 cents. The deal is expected to close in 1Q09.
"Ethicon and Mentor share a common set of values in terms of commercial market leadership, the commitment to developing innovative, science based products, and unwavering service to physicians and patients," said Josh Levine, president/CEO of Mentor.
In other dealmaking activity:
• Quintiles Transnational (Research Triangle Park, North Carolina) said it has acquired Targeted Molecular Diagnostics (TMD; Westmont, Illinois). According to Quintiles, the addition of TMD strengthens Quintiles' service offerings in oncology, an increasingly important growth area of drug development. It provides strong capabilities in tissue-based testing, a critical component of the modern oncology drug development process.
"This acquisition is a logical addition to Quintiles' service offerings," said Tom Wollman, senior vice president, Quintiles Global Central Laboratories. "It provides us with advanced in-house pathology capabilities, including telepathology," he said. "Most importantly, TMD's knowledge in biomarker expression analysis adds significant new proficiencies sought by our customers."
TMD's biomarker technology will help Quintiles' customers better understand how their drugs work and in which populations they're most likely to perform best. "With the addition of TMD's expertise, we can help customers develop novel, targeted cancer therapies and get them to market much faster by employing biomarkers in the development process," said King Jolly, senior VP of drug development partnerships for NovaQuest, the managed partnership group of Quintiles. "We are currently working with large pharmaceutical companies on the design of development programs. TMD will enhance our capabilities to meet those companies' needs."
TMD is a private, oncology-focused, specialty diagnostic laboratory serving the drug development process. The company says it provides guidance through biomarker expression analysis and supports the development of numerous targeted therapies in oncology.
Quintiles says it is "powering the next generation of healthcare" by providing a broad range of professional services in drug development, strategic partnering and commercialization for the pharmaceutical, biotechnology and medical device industries.
• Sorin Group (Milan, Italy) said it has agreed to buy the Clearglide endoscopic vessel harvesting product line from Datascope (Montvale, New Jersey). Financial terms were not disclosed. The transaction is contingent on the closing of the acquisition of Datascope by Getinge (Stockholm, Sweden), satisfaction of typical contractual conditions, and satisfaction of anti-trust procedures in the U.S.
The vessel-harvesting product line will, upon closing, be integrated into Sorin's cardiopulmonary business unit.
According to the company, endoscopic vessel harvesting (EVH) devices enable less-invasive techniques for the harvesting of suitable vessels for use in conjunction with coronary artery bypass grafting. EVH procedures replace traditional open vessel harvesting and avoid significant pain and discomfort for patients during the recovery period, Sorin said.
The Sorin Group offers therapies for cardiac rhythm dysfunctions, interventional cardiology, and the treatment of chronic kidney diseases.
• Genstar Capital (San Francisco), a middle-market private equity firm that focuses on investments in selected segments of the industrial technology, life sciences, healthcare services, business services and software services industries, has agreed to acquire Long Term Care Group (LTCG; Eden Prairie, Minnesota) from Advent International and CCP Equity Partners, in partnership with LTCG's management and industry veterans L. Ben Lytle and Hugh Lytle.
The acquisition of LTCG is the initial investment in Genstar's formation of UniVita Health, a new healthcare services platform centered on the concept of independent aging. UniVita was developed in partnership with healthcare industry veterans Ben and Hugh Lytle, who will lead the management team and growth of the new platform, the firm noted.
• Fujifilm Medical Systems (Stamford, Connecticut) reported the acquisition of Empiric Systems (Morrisville, North Carolina). Fujifilm has acquired 100% of the Empiric stock, making the vendor a wholly owned Fujifilm subsidiary. Financial terms were not disclosed.
The Empiric acquisition follows Fujifilm's 2007 acquisition of ProSolv CardioVascular into the Synapse portfolio, Fujifilm noted. According to the company, it is the first major vendor to deliver seamless, Web-based access to all mammography and cardiovascular images and information, as well as to all RIS data and reports, from one workstation, with a single sign-on and familiar user interface.