The first half of 2024 brought a series of billion-dollar medtech deals across multiple sub-sectors.
Johnson & Johnson’s $13.1 billion takeover of Shockwave Medical easily tops the list as the most expensive purchase so far this year, but several other companies announced or closed large deals of their own, including BD and Boston Scientific.
Here, MedTech Dive looks at the industry’s top five acquisitions of the year and what they mean for the companies involved.
1. Johnson & Johnson buys Shockwave Medical
Amount: $13.1 billion
Date closed: May 31
J&J agreed to buy Shockwave for about $13.1 billion in April to expand its presence in coronary artery disease and peripheral artery disease. Having closed the takeover at the end of May, J&J reported $77 million in sales associated with the acquisition in the second quarter but also incurred costs related to the transaction.
The company raised its full-year sales guidance by $500 million to reflect the acquisition in the second quarter but fell short of its medtech revenue target.
J&J expects sales to accelerate in the second half of the year, supported by the “preferential pricing” CFO Joe Wolk said the company can secure across the world as a result of moves including the Shockwave buyout.
“Now that we're entering areas like cardiovascular of significant unmet need, there are tremendous opportunities for us to ensure that we secure premium pricing for truly differentiated innovations, especially in areas like electrophysiology, in heart recovery with Abiomed and more recently with Shockwave,” Wolk said on the second quarter earnings call.
On the call, Tim Schmid, worldwide chairman of J&J’s medtech unit, touted Shockwave as J&J’s 13th billion-dollar business.
2. BD to buy Edwards’ critical care group
Amount: $4.2 billion
Date announced: June 3
BD agreed to buy Edward Lifesciences’ critical care group for $4.2 billion in June. Edwards revealed plans to spin off the group in December. The plan was to create two more focused businesses, a rationale that has underpinned a wave of spinoffs including BD’s separation of its diabetes care business Embecta.
Edwards ultimately decided to sell the unit to BD rather than create a standalone business. Edwards CFO Scott Ullem discussed the decision at a Jefferies investor event in June, telling attendees that the company received “some reverse inquiry from interested parties” when it disclosed the spinoff plan.
“We're pleased with the result. I think they're pleased with the result,” Ullem said. “It was really a win-win for both companies. The business is performing well, but we're really trying to focus all of our attention on structural heart.”
Ullem said Edwards’ spending priorities will stay the same, with M&A remaining part of the plan. The CFO explained that Edwards’ deals tend to be smaller because the company mainly buys earlier-stage structural heart companies.
In July, Edwards disclosed that it exercised an option to buy Innovalve Bio Medical, a startup that is developing transcatheter mitral valve replacement technologies, for about $300 million in cash. In a separate deal, Edwards agreed to pay 15 million euros (about $16.3 million) for a stake in Affluent Medical and access to its technologies, according to Affluent.
3. Boston Scientific to buy Axonics
Amount: $3.7 billion
Date announced: Jan. 8
Boston Scientific announced its $3.7 billion takeover of Axonics in January. However, Boston has yet to close the acquisition because of scrutiny from the U.S. Federal Trade Commission. In April, Boston delayed the anticipated closure of the transaction into the second half of the year after receiving a second request from the FTC.
Axonics, which manufactures devices to treat urinary and bowel dysfunction, could boost the growth of Boston’s urology business. Boston has inked a series of deals to add growth drivers in recent years. Axonics is among the larger Boston buyouts, but Jonathan Monson, senior vice president of investor relations, said there could be bigger deals to come.
“Obviously, as we get bigger as a company, I think we can do bigger type deals. So, you might see the average size creep up over time, but that's not the priority. It's strategic fit,” Monson said at a TD Cowen event in March.
4. Thomas H. Lee Partners buys Agiliti
Amount: $2.5 billion
Date closed: May 7
Private equity firm Thomas H. Lee Partners (THL) struck a $2.5 billion deal to take medical technology services provider Agiliti private in February.
Agiliti held an initial public offering in 2021 but saw its share price fall in its time on public markets. The company priced its IPO at $14 per share. THL took the company private with an offer of $10 per share.
Agiliti announced that the deal closed in May.
5. Boston Scientific to buy Silk Road Medical
Amount: $1.26 billion
Date announced: June 18
Boston Scientific capped off an active second quarter for medtech M&A by agreeing to buy Silk Road Medical for about $1.26 billion in June. The deal will give Boston control of devices to treat carotid artery disease.
J.P. Morgan analyst Robbie Marcus said in a note to clients the deal is “largely inexpensive for Boston yet meaningful enough to move the needle on growth in the peripheral interventions business.”
Boston Scientific said in the deal announcement that Silk Road forecast a revenue range of from $194 million to $198 million for 2024, representing year-over-year growth of 10%-12%.
