• Cepheid (Sunnyvale, California) reported that it has entered into a definitive agreement to acquire Stretton Scientific (Stretton, UK), a privately held distributor of scientific diagnostic, measuring and monitoring equipment. Cepheid will pay about 1.2 million ($1.9 million) in cash to acquire Stretton. The transaction is expected to close early this month, subject to customary closing conditions, and it is not expected to have a material impact on Cepheid's 4Q08 results. Stretton currently distributes Cepheid's SmartCycler System, among other diagnostic and life science products, to a broad group of medical customers including the National Health Service, medical universities and commercial customers.

• Clinical Data (Newton, Massachusetts) said it will buy struggling Avalon Pharmaceuticals (Germantown, Maryland) in an all-stock transaction valued at $10 million. Avalon said it will keep its operations in Germantown and current staff of 35. The deal is expected to close in two to four months. According to Critcal Data, the combined company will have expanded development capabilities in targeted therapeutics and molecular diagnostics for oncology.

• Ethicon Endo-Surgery (Cincinnati) said it has completed its acquisition of SurgRx (Redwood City, California), following clearance under the Hart-Scott-Rodino Antitrust Improvement Act and similar regulations in other countries. SurgRx is a private developer of the advanced bipolar tissue sealing system used in the Enseal family of devices. Ethicon Endo-Surgery reported its agreement to acquire SurgRx in mid-August. Terms of the transaction were not disclosed. Ethicon said the acquisition "brings together two leading, complementary energy technologies in the rapidly evolving global energy segment. The combined portfolio of Enseal products and the Ethicon Endo-Surgery Harmonic line of ultrasonic medical devices will offer greater functionality and flexibility for diverse surgical procedure requirements."

• Health Systems Solutions (HSS; New York) has agreed to acquire Emageon (Birmingham) for $62 million in cash, or $2.85 a share. The price represents a roughly 37% premium on Emageon's share price as of market close on Oct. 13. HSS said the purchase is being financed by a facility of $85 million, provided by Stanford International Bank, a member of the Stanford Financial Group and HSS's principal shareholder. HSS said the additional funds will be used for working capital and growth initiatives.

• Myriad Genetics (Salt Lake City) says it will spin off its research and development business from its molecular diagnostics business to form two public companies, Myriad Pharmaceuticals and Myriad Genetics. The spinoff is intended to help the companies "excel in their respective fields," Myriad said, acknowledging the different needs of a high-growth, profitable molecular diagnostics business and a pharmaceutical R&D business, the company said. The company expects Myriad Genetics to trade on the New York Stock Exchange and Myriad Pharmaceuticals, a newly formed company, to be listed on the Nasdaq Global Market.

• Natus Medical (San Carlos, California) reported completing its previously disclosed $18 million acquisition of privately held NeuroCom International (Clackamas, Oregon), which develops computerized systems for the assessment and rehabilitation of balance and mobility disorders. Natus said it believes the acquisition will be immediately accretive to earnings, excluding associated one-time charges. The company also said it has agreed to acquire certain assets from BrainZ Instruments (Auckland, New Zealand), a company that makes products for the bedside brain monitoring of neonates, for about $810,000 (NZD $1.3 million) in cash. Natus will acquire essentially all trading assets of BrainZ including the BRM2 and BRM3 monitoring devices, RecogniZe acquisition software, associated intellectual property, and branding.

The Sorin Group (Milan, Italy) reported that it has received a binding offer for the acquisition of its vascular therapy business from Italian investment fund Investimenti e Partecipazioni (IP). Upon completion of the transaction, IP would become the new owner of the entire Sorin coronary vascular therapy business worldwide, including its unique intellectual property portfolio. The Sorin Group is a developer of technologies for cardiac surgery, cardiac rhythm dysfunctions, interventional cardiology and the treatment of chronic kidney diseases.

• SurModics (Eden Prairie, Minnesota), a provider of surface modification and drug delivery technologies to the healthcare industry, reported that it is providing advanced hydrophilic coating technology for Elixir Medical's (Sunnyvale, California) drug-eluting and bare-metal stent systems, which are designed to optimize vessel scaffolding and localized drug delivery to provide a safe and effective treatment for cardiovascular patients. Elixir has conducted five first-in-human clinical studies evaluating the therapeutic effectiveness of the company's novolimus-eluting and myolimus-eluting stent systems. Novolimus and myolimus are macrocyclic lactones in the same family as rapamycin. "SurModics is pleased to license our advanced hydrophilic coating technology for Elixir's novolimus-eluting and myolimus-eluting stent systems," said President/CEO Bruce Barclay. "We believe that next-generation stents, such as Elixir's, will not only improve safety and efficacy, but in the process expand the size of the overall market."