Abiomed (Danvers, Massachusetts) said it will purchase all rights to the Pennsylvania State University implantable replacement heart (known as the Penn State Heart), as well as the assets of BeneCor Heart Systems, an entity recently established to commercialize the product. Abiomed will pay 55,000 shares of its stock, plus newly issued warrants for up to 200,000 additional shares of Abiomed common stock. Exercise of the warrants is based on various regulatory milestones achieved by the Penn State Heart, according to Abiomed. Abiomed also will begin a collaboration with Pennsylvania State University (State College, Pennsylvania), its college of medicine and the Milton S. Hershey Medical Center (Hershey, Pennsylvania), giving Abiomed access to advances in related implantable replacement heart technology generated by the R&D team of the university's College of Medicine. Like Abiomed's AbioCor Heart, the Penn State Heart is an implantable artificial heart designed to replace a patient's irreversibly failing heart. David Lederman, PhD, Abiomed president and CEO, said that the AbioCor and Penn State hearts "represent fundamentally different, yet synergistic, approaches to replacing the failing human heart. With initial clinical trials of the AbioCor within sight, and the consolidation of the world's two leading replacement heart programs within Abiomed," cardiologists will have "broader options to address diverse patient populations that require heart replacement to live."

Medtronic (Minneapolis, Minnesota) will extend its reach in interventional vascular products with the purchase of PercuSurge (Sunnyvale, California) in a stock swap worth an estimated $225 million, folding PercuSurge into its Medtronic Vascular (Santa Rosa, California) business. The PercuSurge GuardWire Plus Temporary Occlusion and Aspiration system is designed to allow cardiologists and interventional specialists to capture embolic debris that may damage the heart during interventional procedures. That debris can break loose and block downstream vessels and vessel branches. Andy Rasdal, president of Medtronic Vascular, cited PercuSurge's embolic protection device as key to the deal, terming it a "best in class" system "for reducing clinical complications associated with embolic debris released during interventional procedures." The PercuSurge GuardWire Plus consists of a balloon-tipped guidewire, which is inflated to occlude blood flow and capture any material dislodged from the wall of the vessel during placement of a stent upstream. Captured material is then withdrawn with the PercuSurge Export aspiration catheter before the balloon is deflated and blood flow restored. The device is being used under investigational protocols in the U.S. It has been used in more than 5,000 procedures in Europe since its release there last year, and it was the first distal protection product to be commercialized there. Its initial indication is for treating degenerated saphenous vein grafts that show signs of disease following heart bypass surgery.

In a stock swap deal worth an estimated $571.5 million, Thoratec Laboratories (Pleasanton, California), a producer of circulatory support products and vascular grafts, said it will acquire Thermo Cardiosystems (Woburn, Massachusetts), a maker of cardiac assist, blood coagulation and skin incision devices. Terms of the deal call for each Thermo Cardiosystems share to be exchanged for 0.835 shares of new Thoratec stock. The merger will result in the creation of a new firm, Thoratec Corp., to be headquartered in Pleasanton. D. Keith Grossman, president and CEO of Thoratec, said the combined company "will create a new and much larger presence within the medical tech marketplace" while also greatly increasing the company's liquidity "and certainly our visibility." He said the new company's market capitalization and valuation "will place us among the largest public cardiovascular companies." The deal is expected to close early next year, with Thoratec shareholders owning about 43% of the outstanding shares. A key focus of synergy between the two companies is in heart assist devices. Thoratec reports that its Ventricular Assist Device System (VAD) is now used by more than 150 hospitals around the world as a bridge to transplant and for recovery of the natural heart following open heart surgery. Thermo Cardiosystems has commercialized two versions of its HeartMate LVAS, an air-driven and electric system. Thoratec estimates that the revenue for the combined companies is projected at between $130 million and $140 million in 2001, and it said revenues could grow by 25% in 2002. Grossman said he expects that Thermo Cardiosystems' subsidiary, International Technidyne, which makes whole blood coagulation testing equipment and single-use skin-incision devices, will maintain its current activities.

In a stock swap valued at about $180 million, Tyco International (Bermuda) will expand further into the medical technology arena through acquisition of InnerDyne (Sunnyvale, California). InnerDyne stockholders will receive a fraction of a Tyco share valued at $7.50 per share for each share of InnerDyne. InnerDyne makes minimally invasive surgical access products that incorporate the company's radial dilation technology, including its patented Step expandable needle system. Radial dilation provides surgical access through expansion of small openings using progressively larger blunt instruments. Tyco chairman and chief executive officer L. Dennis Kozlowski cited InnerDyne's radial dilation system as key to expanding the offerings of U.S. Surgical, a unit of Tyco Healthcare.

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