• ATS Medical (Minneapolis) developer, manufacturer and marketer of cardiac surgery products and services, reported a definitive agreement under which it will acquire all the outstanding shares of privately held 3F Therapeutics (Lake Forest, California) in a stock-for-stock transaction with a potential value with milestones of nearly $58 million. 3F is an early-stage medical device company in the emerging field of minimally invasive, beating-heart tissue valve replacement. ATS said it views the planned acquisition of 3F as a major step in executing its longstanding vision of obtaining a leadership position in all segments of the cardiac surgery market. ATS will acquire 3F by issuing 9 million shares of ATS common stock to 3F shareholders. Those shareholders will be issued up to an additional 10 million shares upon the achievement of certain milestones. ATS also will assume the 3F balance sheet that included an estimated $10 million in cash as of Dec. 1, 2005, to fund future development. The company said it anticipated closing the proposed acquisition, which is still subject to various terms and conditions, including ATS shareholder approval, sometime in 2Q06. 3F Therapeutics was founded in 1998 with a focus on serving the needs of the cardiac surgeon. The company’s heart valve product design concepts are intended to improve on the performance of existing heart valves by mimicking natural valves. The company said it would keep its headquarters in Minneapolis and maintain the existing 3F operations in Lake Forest, keeping the “majority” of 3F’s employees, including President and CEO Walter Cuevas.

• Imagin Molecular (Oak Brook, Illinois) reported forming a wholly owned subsidiary, Imagin Nuclear Partners (INP) that will own, operate and administer outpatient medical diagnostic imaging centers that utilize positron emission tomography (PET) and PET/computed tomography (CT) scanning equipment. Imagin said that INP will specialize in using evidence-based medicine driven by bioinformatics to provide cost-effective benefits to the joint venture partner community. Imagin is also the parent of Cipher Multimedia, a new Media Marketing and Distribution Solution Company providing a distribution solution for publishers of digital content. Cipher will develop marketing campaigns that will assist Imagin, Positron and other companies in product marketing and providing publishers a distribution solution for digital content. Positron manufactures medical imaging devices utilizing PET technology under the trade name Posicam. Posicam systems incorporate software and technology for diagnosis and treatment in cardiology, oncology and neurology.

• Merit Medical Systems (South Jordan, Utah), a manufacturer of disposable accessories used in cardiology and radiology procedures, reported acquiring the stock of MCTec Holding (Venlo, the Netherlands), from Angiotech Pharmaceuticals (Vancouver, British Columbia) for about $3 million cash. MCTec is primarily involved in the coating of wires and tubings for various medical device companies. “The addition of MCTec will enhance the competitive position of Merit’s existing guidewire products and anticipated future products,” said Fred Lampropoulos, Merit’s CEO and chairman. “It will also provide for additional growth in our OEM sales.” Founded in 1987, Merit makes disposable medical accessories used in interventional and diagnostic procedures, particularly in cardiology and radiology. It serves hospitals worldwide.

• Nanogen (San Diego) reported signing an agreement to acquire the rapid cardiac immunoassay test business of Spectral Diagnostics (Toronto), including its cardiac STATus, Decision Point and i-Lynx product lines. The total consideration for the transaction is C$9 million (US$7.67 million), comprised of C$5.65 million in cash and C$3.35 million in Nanogen common stock. The transaction is expected to close during 1Q06, subject to approval by Spectral’s shareholders and other customary closing conditions. Nanogen will assume related sales, marketing and manufacturing activities.

• St. Jude Medical (St. Paul, Minnesota) reported that it has completed the $50 million acquisition of privately held Savacor (Los Angeles), first unveiled in December. Launched in late 2000, Savacor develops heart failure diagnostic and therapy guidance products and technologies, currently in clinical evaluation. Its activities are based on the premise that fixed-dose therapies do not adjust well for changing conditions of congestive heart failure (CHF) and that an implanted sensor can provide continuing assessment for better management. St. Jude said the acquisition complements its efforts already underway in managing CHF. Savacor has heart failure diagnostic and therapy guidance products and technologies under development and in clinical evaluation, including a small implantable sensor device in clinical trials that helps physicians detect and manage symptoms associated with progressive heart failure. In connection with the transaction, St. Jude said it will record a $50 million R&D charge in 4Q05. The implantable sensor device developed by Savacor, dubbed the HeartPOD Heart Failure Therapy System (POD standing for physiologically optimized dosimeter), measures left atrial pressure (LAP) and body temperature enabling real-time adjustments in therapy. An increase in LAP works to force water into the lungs, creating the pulmonary congestion that gives CHF its name, and it is estimated that pulmonary congestion produces about 90% of CHF-related hospitalizations.

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