Medtech in a Minute: Medical Device Companies with an M&A Appetite, and More

J&J Is Hungry for Medtech M&A

Johnson & Johnson executives have indicated interest in medical device acquisitions that would build upon its capabilities, address portfolio gaps, and play in higher-growth markets. CFO Joseph Wolk said the company will assess opportunities of all sizes, but that J&J is partial to tuck-in deals, which typically offer greater value creation. J&J will also be busy this year preparing to split off its consumer products business from its medical device and pharmaceutical businesses, but CEO Joaquin Duato said that won't get in the way of merger and acquisition opportunities.

Abbott May Hop on the M&A Train – or Not

Abbott didn't seem overly eager to hop on the M&A train during the J.P. Morgan Health Care Conference earlier this month. However, last week during the company's fourth-quarter earnings call, suggested that there may be at least some merger and acquisition activity for the company in 2022. CEO Robert Ford offered a bit more insight into the company's M&A appetite last week during its fourth-quarter earnings call, however, saying that medical devices and diagnostics are where Abbott is looking more carefuly. He said the company is most likely to pull the trigger on tuck-in acquisitions or perhaps even some medium-sized deals, so long as the right opportunities present themselves.

Supply Chain Pressure Hits GE Healthcare

GE Healthcare reported a 4.1% decline in revenue during the fourth quarter because of supply chain and inflation challenges. GE Healthcare is expected to become a stand-alone business in 2023 as part of a three-way split that will create three public companies. Parent company GE wants to combine its renewable energy, power, and digital businesses into a separate company in a second spin-off slated for 2024. The remaining GE business will focus on aviation.

And in case you missed our last Medtech in a Minute report...

Acutus Restructures, But Are Steeper Cuts Needed?

COVID-related challenges including hospital access constraints, restrictions on new technology evaluations, and staffing shortages are the reasons Acutus cited for putting into action a restructuring plan to save $23 million to $25 million in annual operating expenses. However, at least one medtech analyst has questioned whether or not the cuts are steep enough.

"The cuts will postpone the need for funding, but we believe steeper cuts are needed, particularly if [the company's] revenue outlook is affected by salesforce disruption and attrition," wrote Marie Thibault, a medtech analyst at BTIG, in a report issued January 20.

Bausch + Lomb Files IPO Paperwork

Bausch + Lomb is one step closer to becoming an independent company. The eye care business has filed IPO paperwork – a measure that would move it away from Bausch Health, its parent company. The spinout is part of a measure that would move create three separate companies, which include Bausch +Lomb eye health business, Solta Medical Aesthetics, and Bausch Pharma Global.

Medtronic Data Wows at NANS

Medtronic made use of the recent North American Neuromodulation Society (NANS) meeting by presenting three-month results from a study showing meaningful pain relief using Differential Target Multiplexed (DTM) spinal cord stimulation (SCS) endurance therapy, a modified, lower-energy variation of the company's DTM SCS therapy for chronic pain. Modeling based on actual three-month data also shows that DTM SCS endurance therapy enables between 5.5 years and 7.5 years device longevity when programmed on Medtronic's Vanta recharge-free neurostimulator. For those in need of a rechargeable device, DTM SCS endurance therapy programmed on the Intellis rechargeable neurostimulator allows either rapid recharge (5 minutes a day) or recharges of about one hour every 12 days.