Blog Tag: M&A

Boston Scientific Agrees to Purchase Majority Stake in M.I.Tech as M&A Deals Are Expected to Pick Up

On June 15, 2022, Boston Scientific entered into a definitive agreement to purchase a majority stake in M.I.Tech Co., Ltd, a publicly traded Korean medical device company in the field of endoscopic and urological procedures. The agreement includes a purchase price of approximately $230 million.  According to the announcement, M.I.Tech is the creator of the HANAROSTENT® technology, a family of conformable, non-vascular, self-expanding metal stents.  Non-vascular stents can be used in gastrointestinal applications and in airways to clear obstructions or constrictions in areas such as the biliary tree, pancreatic duct, esophagus, colon, and duodenum.

Boston Scientific’s Art Butcher, executive vice president and group president, MedSurg and Asia Pacific, stated:

M.I.Tech is an innovator in non-vascular stent development, with product offerings that complement our existing stent portfolio, including the differentiated AXIOS™ Stent and Electrocautery Enhanced Delivery System and the flexible and conformable Agile™ Esophageal Stent System.  We are committed to investing in technologies that advance care for patients around the world and are eager to work more closely with M.I.Tech to expand their international footprint.

Under the agreement, Boston Scientific will be purchasing a 64% stake in M.I.Tech from Synergy Innovation Co., Ltd, whose website identifies M.I.Tech as a subsidiary and a top 5 player in global non-vascular stents.  M.I.Tech’s website also describes other products such as lithotripter baskets, polypectomy snares, veterinary stents, and glucometers.  The transaction is expected to be completed in the second half of 2022.

According to PwC, semi-annualized M&A deal value in the medical device sector is down 85% this year in comparison to the same period in 2021 when $76.4 billion was invested across 93 deals.  PwC attributes the slow-down to acquirers shifting their focus to integration and value capture activities, while the sector deals with regulatory headwinds and semiconductor shortages.  PwC expects deals to pick up across all pharmaceutical and life science sectors in the second half of 2022, with the medical device sector searching for alternative forms of revenue, particularly from new consumer-centric technologies.

Med Device M&A Values Jump Nearly 50% in 1st Half of 2016

According to MergerMarket, the value of mergers and acquisitions in the medical device area jumped by nearly 50% to $74.5 billion in the first half of 2016 (H1 2016) compared with the first six months of 2015.  The 45.5% surge in M&A cumulative value comes despite a 14.5% decrease in the total number of deals (394).

40% of the H1 2016 medical device M&A cumulative value came from a single blockbuster deal, the currently pending deal between Abbott Laboratories and St. Jude Medical.  The market has responded favorably to the Abbott Laboratories acquisition, as the value of the combined entity has risen from $25 billion at the April announcement to almost $30 billion today.

In comparison, the pharmaceutical sector demonstrated declines in both the volume and cumulative value of H1 2016 M&A deals at -12.4% and -34.4% respectively.  The pharmaceutical sector totaled 162 M&A deals, valued at an aggregate of $83.2 billion.  In contrast, H1 2015 had 185 M&A deals valued at a total of $126.8 billion.  As with the medical device space, a major deal accounted for a significant portion of the cumulative M&A value – the $35 billion acquisition of Baxalta International by the Irish headquartered Shire Plc.

Biotechnology M&A deals increased in both volume and cumulative value, rising to 75 deals worth $6.1 billion, an increase of 36.7% over H1 2015.

However, one notable deal collapsed – Pfizer’s $183.7 billion bid for Ireland-based Allergan was withdrawn following the introduction of new tax rules by the U.S. Treasury Department.  Looking prospectively, the new April 2016 tax rules may have an impact on M&A deals in the 2nd half of 2016.