Transaction Value ($millions)

Acquiring Party
Transferring Party
Comments

27,000

Boston Scientific

Guidant

Outbidding Johnson & Johnson Inc., Boston Scientific fortifies itself as a global leader in cardiovascular devices. Boston Scientific has also completed an agreement with Abbott acquiring Guidant's vascular intervention and endovascular businesses, while agreeing to share rights to Guidant's drug-eluting stent program with Boston Scientific.

10,900

The Blackstone Group, Goldman Sachs Capital Partners, Kohlberg Kravis Roberts & Co., and TPG

Biomet Inc.

Orthopedics are regarded as a substantial growth area due to the aging population and other factors, and Biomet represents a major platform to propel expansion as a private company with prominent financial backers. Deal pending shareholder and other approvals.

4,100

Abbott Laboratories

The vascular intervention and endovascular solutions business units of Guidant

Guidant's vascular business offers a broad line of leading coronary and endovascular products, an effective sales force, global manufacturing operations, and a state-of-the-art research and development (R&D) organization that is developing drug-eluting stents. Abbott will pay Boston Scientific milestone payments related to regulatory approvals.

3,400

Allergan Inc.

Inamed Corp.

In this $3.4 billion deal—countering a lower one by Medici Pharmaceutical Corp.—Allergan (maker of Botox) seeks to broaden its portfolio of medical aesthetic products and leverage significant growth and cross-marketing and cross-selling opportunities.

1,400

Johnson & Johnson Inc.

Conor Medsystems Inc.

After losing to Boston Scientific on the Guidant deal, Conor provides immediate muscle to J&J's drug-eluting stent pipeline. The Conor stent is currently sold outside the United States with only investigational device clearance in the United States. The stent employs a unique reservoir drug-delivery technology, enabling site-specific drug delivery as well as the potential for delivery of multiple therapeutic agents that may be useful in the treatment of cardiovascular, peripheral vascular, and neurovascular diseases. Conor's annual revenue is $28 million and, because of R&D, the company has an operating loss.

802

Getinge AB

Huntleigh Technology Plc

Integrates hospital bedside management by combining lifters, support surfaces, and beds. Getinge's extended-care unit deals with patient handling, wound care, and hygiene.

785

Angiotech Pharmaceuticals Inc.

American Medical Instruments Holdings Inc.

Diversifies Angiotech's revenue base and provides manufacturing, marketing, and sales capabilities in several therapeutic areas. American Medical Instruments was formed in 2003 following the purchase of a majority interest in several medical technology companies by RoundTable Healthcare Partners from The Marmon Group.

715

American Medical Systems Holdings Inc.

Laserscope

Strengthens American Medical Systems' strong reputation in urological products with a range of therapy solutions for benign prostatic hyperplasia (BPH) patients. The use of laser-based technologies for BPH procedures has been rapidly adopted due to physician and patient preference for improved postprocedure outcomes. Global reach of the combined AMS-Laserscope sales force will be positioned to capitalize on Laserscope's technology and market position, while driving operating efficiencies and cost synergies.

540

Texas Pacific Group

Transfusion therapies business of Baxter International Inc.

Expands Texas Pacific's assets in the healthcare arena by adding blood-collection products and storage equipment, as well as five manufacturing plants in the Dominican Republic, France, Puerto Rico, and Tunisia.

525

Kyphon Inc.

St. Francis Medical Technologies Inc.

Broadens Kyphon's focus in minimally invasive spine solutions, adding to its existing balloon kyphoplasty technologies for repairing vertebral compression fracture. Beyond the $525 million, the deal includes additional revenue-based contingent payments of up to $200 million.
518
 Johnson & Johnson Inc. Animas Corp. Fits with the J&J Lifescan unit, which makes glucose monitoring systems, and allows J&J to offer more-comprehensive disease management solutions. Animas and Lifescan have worked in partnership for several years. Animas' market cap is more than $450 million, but its revenue ($82 million) and operating profits have been minimal.
463
 Coloplast A/S The urology business of Mentor Corp. This bid significantly enlarges the scope of Coloplast's urology business and strengthens its position in Europe and the United States. Combined annualized sales of Coloplast's urology and continence care products are estimated at $500 million. Mentor urology's fiscal 2005 sales were $232 million and operating profits were $25.5 million.
333
 Orthofix International NV Blackstone Medical Inc. Establishes new platform of spinal implant products to market through Orthofix's distribution channels, together with its noninvasive spinal braces and stimulators. Blackstone's revenues grew by 25% in each of the last three years, with its most recent annual revenues at about $60 million.
290
 dj Orthopedics Inc. Aircast Inc. Fortifies dj's presence with orthopedic surgeons and other providers by adding Aircast's strong ankle and vascular brands. Expands dj's distribution internationally where Aircast derives a third of its sales. Tailwind Capital sells Aircast for $290 million cash; Aircast's most recent annual revenues were $96.8 million.
245
 U.S. Surgical, a unit of Tyco Healthcare Confluent Surgical Inc. Expands U.S. Surgical's suture product portfolio, as well as the Autosuture division's surgical stapler franchise. Confluent's neurosurgical sealant was the first product to receive FDA approval for use in cranial dural repair.
220
 Kyphon Inc. The spine-related product assets and rights of Disc-O-Tech Medical Technologies Ltd. Disc-O-Tech's portfolio includes an expandable interbody device for minimally invasive fusion in patients with degenerative disc disease, a system to treat vertebral compression fractures (VCFs), and a cement system. Further extends Kyphon's minimally invasive spine franchise beyond its present technologies for the treatment of VCFs and diagnosis of the source of low back pain. Kyphon will pay $60 million upfront; another $40 million upon the earlier of the closing or February 1, 2007; a later payment of $120 million; and an additional $20 million upon the development of further technologies.
220
 AngioDynamics Inc. RITA Medical Systems Inc. Creates a diversified producer of access, diagnostic, and therapeutic products that enable interventional physicians and surgeons to treat peripheral vascular diseases and cancerous tumors. RITA's 33-person U.S. sales force targets the same customer base as does AngioDynamics' 52-person U.S. sales force; the companies have virtually no product overlap.
166
 C. R. Bard Inc. Venetec International Inc. Bard Medical adds a leading complementary line of catheter securement devices, used primarily in acute care facilities to reduce complications with peripheral intravenous catheters. The StatLock line replaces tapes and sutures. Venetec's annual sales are estimated at about $34 million.
109
 Encore Medical Corp. Compex Technologies Inc. Creates a stronger orthopedic products company that will combine leading electrical stimulation pain management and rehabilitation companies—Encore's orthopedic rehabilitation division, which includes Empi and Chattanooga Group, and Compex, formerly Rehabilicare. Compex's sales for fiscal 2005 were $96.1 million and its operating profit was $4.6 million.
101
 Integra LifeSciences Holdings Corporation Miltex Inc. Expands Integra's instrument lines and opens up private physician, dental, and ambulatory surgery care channels. Deal price is $101 million. Miltex's 2005 revenues were $62 million. Miltex was owned by American Securities Capital Partners LP, a private equity firm.
100
 Medical Action Industries Inc The medical products division of Medegen Medical Products LLC The 10th and biggest acquisition for Medical Action Industries. Diversifies its product offerings and adds customers (in alternate sites) outside its current channels of distribution (primarily acute care). Medegen's annual sales are about $100 million, and the deal price was about $80 million. The divestiture allows Medegen to focus on its infusion therapy and contract manufacturing businesses.

Table I. Medical device M&A transactions in 2006 with values greater than $100 million. Source: Walden Group.