Cardinal Health to Buy Viasys Healthcare

NEWS TRENDS

Cardinal Health (Dublin, OH), one of the world's largest distributors of medical devices, announced plans in May to acquire Viasys Healthcare (Conshohocken, PA), a broad-based device company, for about $1.5 billion.

Viasys makes respiratory, neurology, medical disposable, and orthopedic products. In June 2006, MD&DI named it one of 50 Companies to Watch.

The move represents the latest step by Cardinal to evolve from a distributor to an owner of manufacturing entities. Its previous big splash to that end was its acquisition of infusion pump manufacturer Alaris Medical Systems in 2004.

Cardinal cited several strategic fits. One will occur with its bedside patient-safety offerings. Viasys has a number of products designed to improve critical care and reduce ventilator-associated pneumonia. Viasys has a reputation for rapid innovation that leads to fast growth. Cardinal hopes to tap Viasys's pipeline to improve its patient-safety-products strategy.

Another shared goal is global expansion. Viasys draws 40% of its revenue from outside the United States. It also has a number of direct sales forces and distributor networks throughout the world.

And Cardinal sees a financial fit as well. It expects to realize savings of $85 million to $100 million per year by fiscal year 2010. This could come from consolidation of redundant businesses, new product sales opportunities through existing Viasys distributors, shared services, and sourcing improvements.

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