Royal Philips NV is expanding its cardio footprint with the acquisition of Biotelemetry Inc., a manufacturer of remote medical technologies, for $2.8 billion, or $72 per share. The proposed deal, announced Friday, furthers Philips’ goal of providing integrated solutions across the care continuum, with Biotelemetry’s cardiac diagnostics and monitoring tools joining Philips’ line of hospital-based patient monitoring solutions.

The announcement comes as the COVID-19 pandemic is driving demand for telehealth and remote patient monitoring. Philips expects the Biotelemetry business to contribute to sales growth and EBITA margin in 2021 and deliver double-digit growth and improve profit margins to more than 20% by 2025.

Amsterdam-based Philips’ current portfolio includes real-time patient monitoring, therapeutic devices, telehealth and informatics. The company also has an advanced and secure cloud-based digital platform, Philips Healthsuite, which is optimized to deliver health care across a variety of settings.

Biotelemetry, headquartered in Malvern, Pa., offers a line of wearable heart monitors, artificial intelligence-based data analytics and services. The company remotely monitors more than a million cardiac patients a year. In 2019, it reported sales of $439 million.

“The acquisition of Biotelemetry fits perfectly with our strategy to be a leading provider of patient care management solutions for the hospital and the home,” said Frans van Houten, Royal Philips’ CEO. “Biotelemetry’s leadership in the large and fast growing ambulatory cardiac diagnostics and monitoring market complements our leading position in the hospital. Leveraging our collective expertise, we will be in an optimal position to improve patient care access across care settings for multiple diseases and medical conditions.”

Major synergies

The acquisition should bring major synergies powered by cross-selling opportunities, geographical expansion, pipeline opportunities and productivity gains.

On a call, van Houten pointed to Biotelemetry’s 30,000 referring physicians. “Effectively, that is a new channel for Philips,” he said. “And in that channel, we want [to] and can provide our offering for multiple therapeutic areas.”

Biotelemetry’s remote monitoring portfolio currently focuses on cardiac rhythm monitors, but “we see lots of opportunities to also broaden the scope of wearables,” van Houten said, adding Philips’ wearables also will benefit from the Biotelemetry’s services platform.

Among potential new applications for the Biotelemetry platform, he cited sleep and respiratory care, noting COVID-19 may increase the number of patients with chronic respiratory conditions.

In turn, Philips will use its channels to leverage the Biotelemetry platform globally.

“Through continued innovation, we have developed the world’s largest remote cardiac monitoring services network,” said Joe Capper, president and CEO of Biotelemetry. “Combined with Philips’ current patient care management portfolio, innovation strength and global scale, we are perfectly equipped to address the rising demand for telehealth and remote monitoring solutions.”


Competition-wise, the combination gives Philips a solid edge in the estimated $3.7 billion cardiac ambulatory market. Biotelemetry currently is No. 1 in the space, with 35% market share, Roy Jakobs, executive vice president and chief business leader of Philips’ Connected Care business, said on the call. In second place is San Francisco-based Irhythm Technologies Inc., with 25% share, followed by Preventice Solutions, of Minneapolis, with 15% share.

Of those, Biotelemetry is the only company that offers all four cardiac measurement types: short-term Holter monitor, extended long-term Holter, cardiac event monitor and mobile cardiac telemetry, Jakobs said. “The biggest segment of Biotelemetry, which is the mobile cardiac telemetry, … we expect that there is growth in this market because we see the need for diagnosing undiagnosed patients going up,” he said.

Tender offer

Philips’ cash tender is to acquire all shares of Biotelemetry for $72 per share, representing a 16.5% premium to Biotelemetry’s Dec. 17 closing price. Upon completion, Biotelemetry and its roughly 1,900 employees will become part of the Philips’ Connected Care business.

The deal is expected to close in the first quarter of 2021, pending regulatory approvals.

Asked if there are any missing pieces in Philips’ cardiac care business, van Houten didn’t rule out further acquisitions. “I think this is a big step, and organically, now between Biotelemetry and Philips, we can expand a lot.” That said, there is room to “deepen the portfolio” in image-guided therapy, an area of previous cardiac acquisitions, “but it’s undeniable that Philips is quickly becoming an expert in the end-to-end cardiovascular pathway from diagnosis to treatment and to chronic disease management.”