Updated: Boston Scientific Continues M&A Spree with $160 Million Deal for Veniti; Lays Off 85 in Massachusetts
As layoffs announced last year loom closer for 85 employees at a Burlington, Mass. manufacturing site, this morning Boston Scientific forked over up to $160 million to acquire California stent maker Veniti, Inc. The deal marks the third acquisition for Boston Scientific in two months.
Boston Scientific has been investing in Veniti since 2016, the company said this morning, and already owned 25 percent of the company. Under terms of the deal, Boston Scientific provided an upfront payment of $108 million in cash. Boston Scientific will provide an additional $52 million to Veniti contingent upon the U.S. Food and Drug Administration’s approval of the Vici stent system, which was designed for use in the venous anatomy to treat venous obstructive disease. The stent is designed to withstand compression and maintain “patency and flexibility over the course of a patient's life expectancy,” the company said.
Jeff Elkins, president and chief executive officer of Veniti, said the stent was designed with the demands of the venous system in mind. He said it will provide physicians with a “high-quality lumen across a variety of venous anatomies and disease states.” Elkins said under the leadership of Boston Scientific, the Vici system will become more accessible to patients and physicians.
The Vici stent system has already been approved for use in Europe. Veniti applied for approval in the U.S. earlier this summer. In its announcement, Boston Scientific said there are no current U.S. approved stent technologies specifically indicated for use in the peripheral venous system.
“With the unique benefits of this differentiated technology and the strong experience of Boston Scientific in the overall venous market, we believe the VICI stent will become an important choice for physicians who choose stents to treat patients suffering from venous disease,” Jeff Mirviss, head of Boston Scientific’s Peripheral Interventions division said in a statement. “Along with our leading AngioJet thrombectomy platform and venous product pipeline, we look forward to meeting the needs of physicians treating both chronic and acute venous disease.”
Boston Scientific said the acquisition of Veniti is not expected to impact the company’s adjusted earnings per share for 2018 and 2019.
While Boston Scientific could see growth through the acquisition of the stent manufacturer, earlier this week the company culled some of its employees at the Burlington site it gained through the 2016 acquisition of Cosman Medical, the Boston Business Journal reported Monday. The layoffs are planned to begin between September and December, the Journal reported, citing a Worker Adjustment and Retraining Act filed with the state. The Burlington facility manufactures products for pain relief. Kate Haranis, a spokesperson for Boston Scientific, told BioSpace that the company made a decision one year after the Cosman acquisition to transfer manufacturing, supply chain and quality operations for our radio frequency ablation (RFA) product from the Burlington site to other Boston Scientific facilities. This change will integrate our manufacturing and distribution networks to gain efficiencies, leverage key capabilities and accelerate the global expansion of this important chronic pain therapy for more patients around the world. Research and Development, Customer Service and Sales functions will remain in Burlington, Haranis said in an email.
Veniti is not the only company Boston Scientific has acquired. In July the company snapped up Claret Medical for up to $270 million. It also bought Cryterion Medical, Inc. for $202 million. Boston Scientific already owned a significant chunk of Cryterion.