After a Lull, Cardioband Purchase Represents Latest in Mitral Valve Tech Acquisitions
A protracted lull following the flurry of mitral valve acquisitions by the big device companies in 2015 has been broken, this time with news that Edwards Lifesciences has acquired the Israel-based Cardioband manufacturer, Valtech.
Unlike acquisitions that shook this space last year, the device at the heart of this news is a repair technology, not a replacement device. Cardioband is a percutaneously implanted “direct annuloplasty” product that, in preliminary studies, has successfully reduced septolateral dimensions and reduced mitral regurgitation with minimal adverse events.
The path to acquisition for the Cardioband technology has been a bumpy one, perceived by some as emblematic of the many efforts and many setbacks that have plagued the transcatheter mitral valve innovation space. Back in 2015, Valtech reached a buyout deal with the ventricular assist device company HeartWare International, which announced plans to buy the smaller company in an all-stock, no-cash deal valued at $800 million. As reported by TCTMD, however, that buyout was scrapped after investment group Engaged Capital successfully lobbied HeartWare to abandon its acquisition plans, arguing the Cardioband was unlikely to deliver solid profits.
Edwards Lifesciences apparently sees things differently. In an announcement earlier this week, the valve giant said it has agreed to buy Valtech for $340 million in stock and cash, “with the potential for up to $350 million in additional prespecified milestone-driven payments over the next 10 years.” Of note, before the transaction closes, Valtech must spin off a separate, early-stage transseptal mitral valve replacement technology, although Edwards retains an option to acquire this program.
HeartWare International, meanwhile, ended up being was purchased by the other leading transcatheter valve maker, Medtronic, this past summer.
In 2015 three of the biggest international medtech companies acquired mitral valve replacement devices in very early-stage testing: Edwards bought CardiAQ, Medtronic bought Twelve, and Abbott bought Tendyne, each spending an estimated $400 million. There are more than 50 smaller companies currently developing mitral valve repair and replacement devices, leading some experts to ask whether “innovation overload” is holding back the field. There may simply not be enough patients, enough investors, and enough regulatory enthusiasm to support so many efforts moving forward, they say.
As for the Cardioband device, sceptics have pointed out that isolated annuloplasty for functional mitral regurgitation is rarely performed by surgeons, leading some to speculate that this percutaneous procedure should be accompanied by full valve replacement or a leaflet clip. Dual procedures, however, would require more time and be substantially more costly.
Edwards Lifesciences. Edwards enters into agreement to acquire Valtech Cardio. http://www.edwards.com/ns20161128. Published on: November 28, 2016. Accessed on: November 30, 2016.