Stryker Slams Down $662M for Entellus Medical
Stryker said Entellus’ portfolio of products designed for the minimally invasive treatment of various ear, nose and throat (ENT) disease is highly complementary to its existing ENT portfolio. Entellus’ ENT portfolio is led by e XprESS Multi-Sinus Dilation System and the LATERA Absorbable Nasal Implant.
“Entellus is a leader in the ENT segment and offers a comprehensive portfolio of products that enable physicians to conveniently and comfortably perform a broad range of ENT procedures,” Timothy J. Scannell, Stryker’s group president of MedSurg and Neurotechnology, said in a statement.
Entellus Chief Executive Officer Robert S. White said the combination of Stryker’s position in the healthcare community and Entellus’ “innovative products within the ENT segment” means the company’s existing customers will continue to be provided with the tools necessary for “cost-effective solutions.”
Investors in Entellus were certainly pleased at the acquisition. Shares shot up more than 48 percent to hit $23.82. Stryker agreed to acquire Entellus for $24 per share.
The deal was unanimously supported by the Entellus board of directors. Closing is subject to approval by Entellus’ stockholders.
Stryker’s acquisition of Entellus comes a little more than two months after it was made public after the U.S. Food and Drug Administration sent a warning letter to Entellus Medical. The letter, initially sent in April, was over the company’s failure to prevent physicians from violating the approved protocol for a pediatric trial of its Xpress sinus dilator. An FDA inspection found regulatory violations “covering investigational device exemptions and the protection of human subjects, involving use of the Xpress dilator in patients under age 12 in frontal and sphenoid sinuses; the trial’s approved protocol only allowed treatment in the maxillary sinus for patients that young,” according to the letter.
In October, Stryker acquired a controlling interest in Vexim, a French medical device company that specializes in the minimally invasive treatment of vertebral fractures. Stryker said Vexim’s portfolio of products is complementary to its own Interventional Spine (IVS) business. Vexim’s flagship product is the SpineJack system, a mechanical expandable VCF implant for fracture reduction and stabilization.
For the acquisition of Entellus, Piper Jaffray & Co. served as financial advisor and Latham & Watkins LLP and Fox Rothschild LLP served as outside legal counsel for Entellus.
Shares of Stryker are down slightly to $151.26 as of 10:31 a.m.