US-based medical device company BD (Becton, Dickinson and Co.) has agreed to acquire Edwards Lifesciences’ Critical Care product business for $4.2bn in cash.
Critical Care is engaged in advancing patient monitoring with AI-based algorithms and has created the hemodynamic monitoring category.
Its solutions are currently used in more than 10,000 hospitals worldwide, to better understand the cardiovascular condition in real-time for critically ill patients, and to improve outcomes.
The haemodynamic monitoring and medication management technologies are often used simultaneously in the operating room or ICUs, with interoperability across the care continuum.
The proposed transaction is expected to be completed by the end of this year, subject to the satisfaction of certain closing conditions, including antitrust and foreign investment approvals.
Upon closing, Critical Care will operate in Irvine, CA, under the leadership of Katie Szyman, Edwards corporate vice president for Critical Care.
BD intends to fund the transaction with nearly $1bn in available cash and $3.2bn in new debt.
BD chairman, CEO and president Tom Polen said: “Critical Care expands BD’s portfolio of smart connected care solutions with its growing set of leading monitoring technologies, advanced AI-enabled clinical decision tools and robust innovation pipeline that complement BD’s existing technologies serving operating rooms and intensive care units.
“We believe the combination unlocks multiple new avenues for growth and value creation through BD’s broad global footprint, increased penetration across new and existing hospital customers, new innovation opportunities across data sets and platforms, and application of the BD Excellence operating system.
“Critical Care is well aligned to BD’s core innovation and business strategies, is a strong cultural fit and we look forward to welcoming Katie and Critical Care’s talented team to BD.”
Based in Irvine, California, Critical Care has around 4,500 employees, and the business generated over $900m in revenue, last year.
Critical Care’s portfolio includes the gold-standard Swan Ganz pulmonary artery catheter, minimally invasive sensors, non-invasive cuffs, tissue oximetry sensors and monitors.
Its smart technologies are driven by machine learning and AI-based predictive and prescriptive algorithms to help clinicians better understand patient conditions.
Edwards said that the transaction will enhance its investments in technologies for aortic, mitral, tricuspid, and pulmonic patients, along with new therapeutic areas for heart failure.
The company intends to use the after-tax cash proceeds to fund strategic growth investments.
Goldman Sachs & Co. and Morgan Stanley & Co. served as financial advisors, and Skadden Arps served as legal counsel to Edwards on the transaction.
Edwards’ CEO Bernard Zovighian said: “Edwards’ underlying rationale for separating Critical Care remains the same: we are laser-focused on pursuing a strategy centred on structural heart disease.
“Our goal is to serve large unmet patient needs with our differentiated innovations while extending our global leadership, delivering sustainable growth, and increasing shareholder value.
“Critical Care has made significant contributions to our company and has a long history of pioneering innovation. We believe this transaction will strengthen Edwards, Critical Care and BD, paving the way for both companies to deliver even greater value to patients.”
