A Medical Device Daily

Viasys Healthcare (Conshohocken, Pennsylvania) reported signing an agreement to acquire Micro Medical (Chatham, UK) for about $39 million.

In addition, Viasys will assume about $1.2 million in Micro Medical's net debt and has agreed, in certain circumstances, to make a contingent payment related to the sales of a new product and a contingent payment related to performance targets.

Micro Medical, having a global presence in hand-held and desktop devices for respiratory measurements used to diagnose and monitor asthma, chronic obstructive pulmonary disease (COPD) and bronchitis, had 2004 revenues of about $16 million. The company's products target physician office practice and primary care.

Ed Pulwer, group president, Viasys Respiratory Care, said that the acquisition "brings us an outstanding company in one of the fastest growth segments of respiratory diagnostics. The continued rise in the incidence of asthma and COPD, and the financial burden associated with chronic respiratory disease, has resulted in medical professionals and governments calling for early diagnosis, intervention and management of these patients." He added: "I believe the combined strength of Micro Medical in spirometry, and the recognized market leadership of Viasys' brand names, Jaeger and Sensormedics, for respiratory diagnostics, will prove to be a winning combination."

Daniel Quirke, managing director of Micro Medical, called Viasys "a great fit for Micro Medical. . . While we have been very successful in our marketing efforts in the United Kingdom, we do not believe we have tapped the growth potential in markets such as the U.S., Germany, Japan and China."

Viasys conducts business through its Respiratory Care, NeuroCare, MedSystems and Orthopedics units.

In other deals activity:

• Dialysis Corporation of America (DCA; Linthicum, Maryland) and Medicore (Hialeah, Florida) said they have agreed to a plan in which Medicore – already owning 57% of DCA – will merge into DCA for about 5,289,000 shares of DCA stock. With merger completion, Medicore shareholders will receive .68 shares of DCA common stock for each share of Medicore stock held. Medicore's current 57% ownership of DCA will be retired and the outstanding shares of DCA will total about 9 million.

The companies said the merger will simplify corporate structure and enable controlling interest of DCA to be in the public hands, rather than one controlling party. The merger also provides DCA with assets to build its dialysis business and expand its medical supply operations, it said.

DCA president and CEO, Stephen Everett, said, "The infusion of additional capital resources into our company makes this very appealing to DCA as we continue to build and expand our company."

DCA owns and operates freestanding kidney hemodialysis centers in Georgia, Maryland, New Jersey, Ohio, Pennsylvania, South Carolina and Virginia, and provides contracted in-hospital dialysis services in those states.

The companies' boards have approved the merger, with deal completion subject to various conditions including approval by shareholders of both companies, to be sought in July.

Medicore is engaged in the operation of kidney dialysis centers through DCA. It also has a division which distributes medical products, owns realty in Hialeah, Florida, and holds investments in two affiliated Linux software firms.

• WebMD (Elmwood Park, New Jersey) reported that it has acquired HealthShare Technology (Acton, Massachusetts) for $31 million in cash and up to another $5 million if certain milestones are achieved during calendar year 2005.

HealthShare provides health plans and employers with online support tools that evaluate cost and quality to enable better decisions about hospital care. It also provides decision tools used by health plan executives to develop provider networks, identify centers of excellence and evaluate comparative hospital quality.

WebMD Health, the company's portal segment, provides healthcare information, decision support and interactive communication products to more than 20 million consumers and healthcare professionals through its public web sites.

• American HealthChoice (Flower Mound, Texas), with 30 owned and affiliated clinics in Texas, reported that its RehabCo subsidiary has completed acquisition of the assets of Nevada-based Axiom Marketing Group, a distributor of the DRX9000 back pain treatment system manufactured by Axiom Worldwide (Tampa, Florida). Terms were not disclosed.

The purchase allows American HealthChoice to market the DRX9000 Spinal Decompression System (DRX), a non-surgical treatment for lower back pain caused by herniated or degenerative discs, sciatica and other common back ailments.

Dr. J. W. Stucki, CEO of American HealthChoice, said, "This innovative addition to American HealthChoice will pay huge dividends to the company and its shareholders."

The company said that RehabCo is on target for 12 placements of the product by the end of June, with sales of more than 50 units projected over the next 12 months.