Blog Tag: Baxter

Baxter Completes $10B+ Acquisition of Hillrom

On December 13, Baxter International Inc. (“Baxter”) announced the completion of one of the biggest medtech acquisitions of 2021, acquiring Hillrom (a global medical equipment maker headquartered in Chicago) for a purchase price of ~$10.5 billion.  The deal had originally been announced by Baxter in September 2021.

According to a statement on Baxter’s website, “Baxter’s acquisition of Hillrom has formed one of the world’s leading medical technology companies, centered around a shared vision to transform healthcare.”

Baxter’s product portfolio includes diagnostic, critical care, kidney care, nutrition, and surgical products used in hospitals, physician offices, and patient homes.  According to Baxter, the addition of Hillrom’s product lines, including legacy Welch Allyn products that were acquired by Hillrom in 2015, will help Baxter improve care outcomes and broaden access to care.  Hillrom’s products include the MacroView® Plus Otoscope, the Volara™ Oscillation & Lung Expansion Therapy System, the PST 500 Precision Surgical Table, and the Centrella® Smart+ Bed.

In a press release, Baxter’s chairman Jose E. Almeida stated:

The Baxter-Hillrom combination unlocks the next phase of our transformation, presenting a new wave of potential to drive greater impact for patients, clinicians, employees, shareholders and other communities we serve worldwide.  Integrating our complementary capabilities introduces additional opportunities for growth across our broad geographic footprint and also creates remarkable new possibilities for connectivity with leading-edge digital health innovation focused on enhancing care, lowering costs and increasing workflow efficiency.

According to the press release, Baxter expects the combination to result in ~$250 million of annual pre-tax cost synergies within 3 years.

Fighting Fire with Fire – the Medical Device Tax and Outsourcing

Fighting Fire with Fire – the Medical Device Tax and Outsourcing

Since its passage as part of the Affordable Care Act in 2010, the medical device tax has been hotly debated.  The 2.3% excise levied on total revenues may effectively preclude new entrants while hindering the growth of established companies.  While industries have turned to outsourcing for a number of years as a way to cut costs, the medical device industry may increasingly consider outsourcing in the coming years as a means to offset the effects of this tax.  While outsourcing may help U.S. medical device companies, it may adversely affect Americans currently working in this sector.