2013 Medtech M&A Review: Medtronic Acquires a Disease Management Company

By Clyde A. Burkhardt

In August, heart device titan Medtronic acquired Cardiocom LLC, a privately held disease-management and patient-monitoring company, for $200 million. Cardiocom produces a variety of products including home glucose monitors for diabetes management. The acquisition is timely and significant, and it could lead to similar transactions by other major medtech companies as they fully recognize, understand, and react to the impact of the Affordable Care Act (ACA).

Regardless of how the ACA ultimately plays out, the die is cast, and hospitals, doctors, and medical personnel will be increasingly responsible for and rewarded for keeping people healthy and taking steps to minimize healthcare costs. Bottom line: The transaction puts Medtronic in the business of working with hospitals and insurance companies to limit the cost of treating patients with chronic diseases, including heart failure and diabetes, and positions it to provide services to patients who do not need costly implantable devices or therapies.

Clyde A. Burkhardt is senior managing director of HT Capital Advisors LLC (New York City), a private investment banking firm. He leads HT Capital Advisors' groups focusing on the medical device, healthcare services, and precision component industries. Contact Burkhardt at [email protected].