After making a significant strategic investment in Oxganox Ltd. earlier this year, Terumo Corp. returned to buy the company. This morning, the companies announced that Terumo would acquire Organox for $1.5 billion, marking Terumo’s entry into the organ transplant sector. The transaction is one of the largest exits ever for the U.K. med-tech sector.

Oxford, U.K.-based Organox’s primary product, the Metra system, is a normothermic machine perfusion system for liver that maintains donor livers in a functioning state outside the body for up to 24 hours. Metra has been used in 6,000 liver transplant procedures to date.

In late June, the U.S. FDA approved a pre-market approval (PMA) supplement for Metra that included removal of the air transport warning from its previous labelling, which had restricted use to a “back to base” approach that required livers to be perfused on site at the transplant center prior to surgery.

This restriction “has been a key competitive disadvantage for Organox and [we] expect the PMA supplement to put it on a more level playing field with Transmedics Group. Our checks indicate that Organox had priced its device at a discount to Transmedics; whether this price differential continues given the new approval remains to be seen,” said Mike Matson and colleagues at Needham.

The acquisition “validates the strategic value of organ preservation technology,” noted Joshua Jennings of TD Securities. “Terumo’s $1.5 billion acquisition of Organox underscores a growing consensus: organ preservation technologies are emerging as a core strategic priority for larger med-tech companies already leveraged to the transplant industry.”

“Following Getinge’s purchase of Paragonix in 2024, this deal marks another example for an established multinational player paying a premium valuation to secure a foothold in the organ preservation space,” Jennings added. “The transaction confirms that organ transplantation is no longer a niche market, but rather a growth segment that is attracting substantial investment.”

The deal will add transplant technology to Tokyo-based Terumo’s product lines, which previously fell in three divisions: cardiovascular, general hospital and blood management. “By combining Terumo’s long-standing expertise in designing medical devices and equipment with Organox’s advanced capabilities in normothermic perfusion (NMP), the company aims to deliver innovative organ preservation devices globally. Terumo seeks to broaden access for patients in need of transplants and contribute to the advancement of transplantation medicine, by aiming to address key challenges in organ transplantation, including improving organ utilization rates, enabling the use of marginal donor organs, enhancing post-transplant outcomes, and reducing the burden on health care professionals through minimizing nighttime and emergency procedures,” Terumo said.

The deal represents the largest exit for Organox’s lead investor, BGF, who pocketed proceeds of £175 million (US$236.67 million.)

“The deal has driven a 10x money multiple exit on BGF's initial investment and an overall internal rate of return in the region of 69%,” BGF said. Other investors included Longwall Ventures, Oxford Investment Consultants, Lauxera Capital Partners, Healthquest, Technikos and Oxford Technology Management among others. The University of Oxford, from which Organox spun out in 2008, also invested in the company.

“Organox has transformed liver transplantation and built a world-class position in med tech. In a sector where institutional capital is constrained, this exit highlights the importance and potential of patient growth capital, and a willingness to back innovation before it is de-risked — something many investors find difficult to do in this still nascent market," said Tim Rea, co-head of early stage investing at BGF.

BGF has shown both patience and commitment since it first invested in Organox in 2019.

"Once BGF had a board seat in 2019, occupied by Tim Rea, I knew that if we succeeded in maintaining our focus and momentum as a business and a team, that Organox would not run out of funds in the future,” said Organox CEO Craig Marshall. “BGF's conviction remained with us throughout, and they not only participated in every round of funding after their first investment but initiated and shaped a number of these funding rounds."

Organox’s most recent fundraising round in February pulled in $160 million.