Teleflex Pays $1B For Vascular Solutions, Enters Peripheral And Coronary Vascular Market
Teleflex has entered into a definitive agreement to acquire Vascular Solutions for $1B, a move that will launch Teleflex into the coronary and peripheral vascular markets. Teleflex CEO Benson Smith commented that the acquisition is a “significant step” in the company’s ongoing growth strategy, which will leverage Teleflex’s international distribution network with Vascular Solutions’ robust R&D pipeline.
Vascular Solutions — founded in 1997 — specializes in the development of minimally invasive solutions for peripheral and coronary vascular procedures, with over 90 product offerings in the interventional cardiology and interventional radiology spaces. Vascular Solutions’ Langston dual lumen catheter provides simultaneous pressure measurements, and the Pronto V4 extraction catheter for the removal of blood clots. The company also provides reprocessing services to reduce hospital costs and waste.
In a press release, Smith praised Vascular Solutions’ record of long-term double-digit growth, and a product portfolio that addresses current unmet needs in high-value procedure categories. Teleflex’s international distribution network combined with Vascular Solutions’ R&D pipeline is especially conducive to long-term growth, said Smith.
Teleflex midline offerings expanded in 2015 with FDA’s approval of the Arrow Endurance Extended Dwell Peripheral Catheter System, and the company has been working steadily in recent years to expand and diversify its product offerings, according to an MDO guest column by iData researchers. A recent report from Decisions Resources Group estimated that the vascular access device market will surpass $2B by 2022.
Smith remarked that the acquisition of Vascular Solutions follows the same M&A strategy and growth trajectory as Teleflex’s acquisitions of Vidacare in 2013 and LMA in 2012 — tuck-in deals that expand the company’s existing business units. Smith also expressed his company’s interest in technology that provides superior clinical and cost benefit to patients and hospitals.
“We are delighted with this combination, which will further improve our commitment to coronary and peripheral vascular care by providing greater access to our innovative product offerings for patients around the world, while offering our shareholders immediate value,” said Howard Root, chairman and CEO of Vascular Solutions.
Root recently was acquitted on all federal charges in a long-term court case, which alleged that Root conspired to sell medical devices for non-approved indications, reported the Star Tribune. FDA recently opened discussions with the device industry regarding the promotion of off-label indications for products. While industry advocates argued for free-speech, FDA commissioner Robert Califf expressed concerns that looser restrictions on promotion could dampen rigorous clinical study.
The acquisition of Vascular Solutions is expected to close in the first half of 2017 if approved by shareholders from both companies. Benson noted that shareholders should begin seeing “incremental” revenue returns from the transaction starting next year.