Medtronic Pays $458 Million For Mitral Valve Device Developer Twelve

By Jof Enriquez,
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Medtronic has announced the acquisition of Twelve, Inc., a privately-held developer of a transcatheter mitral valve replacement (TMVR) device for the treatment of mitral regurgitation. The deal allows Medtronic to keep pace with rivals in the burgeoning transcatheter valve replacement device segment.

Under the deal, which is expected to close in October, Medtronic will pay $408 million at closing for Twelve, plus a $50 million milestone payment, the Wall Street Journal (WSJ) reports. The transaction is considered earnings neutral as Medtronic intends to offset its dilutive impact. Twelve will join the Coronary & Structural Heart division within Medtronic's Cardiac and Vascular Group.

Twelve gets its name as the twelfth company spun out from the premier medical device incubator The Foundry. The company is developing a TMVR device designed to be inserted transapically in patients with mitral valve regurgitation in whom standard restorative surgery is not feasible. Mitral regurgitation occurs when the mitral valve does not close properly, allowing blood to leak backward into the left atrium, causing increased pressure, congestion, and heart failure.

"Twelve's technology is a truly creative solution that brings together valve technology with a unique and highly differentiated dual-stent fixation design," said Andrew Cleeland, president and CEO of Twelve, in a statement. "Our acquisition by Medtronic will create a tremendous opportunity to leverage Medtronic's expertise and proven success in the structural heart space to advance the treatment of mitral regurgitation."

A study record on ClinicalTrials.gov states that Twelve is currently conducting a pilot study for a TMVR implant. It is enrolling 10 participants for the study, which has an estimated primary completion date of September 2016 (final data collection date for primary outcome measure).

Medtronic's purchase of Twelve allows it to keep up with major medical device companies who lately have snapped up small developers of transcatheter valve replacement technologies. In July, Edwards LifeSciences paid $400 million for CardiAQ Valve Technologies, developer of an early-stage transcatheter mitral valve implantation (TMVI) system, to complement Edwards' own FORTIS device. Later that month, Abbott entered into separate agreements with two mitral valve replacement companies, buying Tendyne Holdings, Inc. for $250 million, and investing in Cephea Valve Technologies for an undisclosed amount.

"Upon close, this acquisition will strategically augment our existing capabilities in the transcatheter mitral space, which represents an important growth opportunity for Medtronic," said Sean Salmon, senior VP and president, Coronary & Structural Heart, Medtronic, in the statement. "We have followed the transcatheter mitral valve space closely and firmly believe that Twelve has the most novel technology along with a strong, proven team. The combined strengths of our organizations will significantly accelerate our ability to deliver an exciting and differentiated therapy to patients, physicians and healthcare systems around the world."

Device makers are betting that TMVR devices could be a major growth driver similar to transcatheter aortic valve replacement (TAVR) devices. According to a Dispatch Times article, Glenn Novarro, an analyst with RBC Capital Markets, estimates the global TMVR market to be worth as much as five times that of the TAVR market, which is forecast to be valued at about $5 billion in 2020.