* Enters renal denervation market with acquisition
* Renal denervation can help hypertension when drugs fail
* Seen as multi-billion market by 2020
* Boston Scientific shares flat
Nov 8 (Reuters) – Boston Scientific Corp said on
Thursday it will acquire privately-held Vessix Vascular Inc, a
developer of a catheter-based device that treats high blood
pressure by deadening nerves near the kidneys.
Under the terms of the deal, expected to close at the end of
November, Boston Scientific will make an upfront payment of $125
million, plus milestone payments of up to $400 million between
2013 and 2017. The deal is expected to be immaterial to adjusted
earnings in 2013 and 2014, and break-even to profitable
thereafter.
One in three adults in the United States has high blood
pressure, according to the National Institutes of Health.
Health officials say more than one billion people in the
world suffer from the ailment, also known as hypertension, which
can lead to coronary heart disease, heart failure, stroke,
kidney failure, and other health problems.
Normal blood pressure is below 120/80 mmHg (millimeters of
mercury). Hypertension is a reading above 140/90 mmHg.
Despite widespread availability of drugs to treat the
condition, blood pressure in many patients remains uncontrolled.
Renal denervation is a procedure in which a thin, flexible
catheter is threaded through the body to the renal sympathetic
nerves near the kidneys. Radiofrequency energy is delivered to
disrupt the nerve activity, relieving high blood pressure.
Renal denervation is expected to be a multibillion dollar
market by 2020, according to Boston Scientific, a maker of heart
pacemakers, implantable defibrillators and heart stents.
The new therapy is not yet approved in the United States,
but several products are available in Europe.
Device makers that have received approval to sell
hypertension devices in Europe include frontrunner Medtronic Inc
, St Jude Medical Inc, Covidien Plc,
ReCor Medical and Vessix, which also has approval in Australia.
“We think the acquisition of Vessix is strategically
important as it provides Boston Scientific an entrance point
into the valuable renal denervation market and it does so with a
product that we think has advantages that will likely make it a
viable competitor,” said Wells Fargo analyst Larry Biegelsen,
who characterized the market as overcrowded.
Boston Scientific shares were trading at $5.16 on the New
York Stock Exchange, unchanged from Wednesday’s close.
