Zimmer Biomet To Buy LDR For $1B, Bolster Spine Business
Zimmer Biomet on Tuesday announced its intent to buy LDR Holding Corporation, a France-based medical device company specializing in surgical solutions for spine disorders, in a deal worth $1 billion. The acquisition will “meaningfully accelerate” Zimmer Biomet’s spine business and position the company as market leader in the $10B global spine business, said senior leadership.
LDR’s primary products are based on its VerteBRIDGE fusion and Mobi non-fusion technologies, designed to provide less invasive solutions for cervical and lumbar spine surgeries. LDR’s portfolio of products establishes Zimmer Biomet’s foothold in fast-growing spine businesses: cervical disc replacement (CDR) and other minimal incision surgical (MIS) technologies. According to a Persistence Market Research report, the CDR market is projected to reach $1.8 billion by 2021.
LDR recently announced five-year clinical results for two-level Mobi-C, which demonstrated the solution’s ease of use, flexibility, and long-term superiority compared to anterior cervical discectomy and fusion treatment (ACDF), the current clinical standard for treating cervical degenerative disease. Mobi-C’s success rate of 62.8 percent was nearly double the 34.1 percent success rate for ACDF, based on overall success criteria.
Under the terms of the $1B acquisition, LDR will be folded into Zimmer Biomet’s existing Spine & CMF business segment, currently led by Adam Johnson, group president. Zimmer Biomet CEO David Dvorak commented in a press release that the acquisition will advance the company’s innovation leadership goals and “drive meaningful growth” across all musculoskeletal markets
“This highly strategic and complementary transaction will enhance Zimmer Biomet’s innovation leadership in musculoskeletal healthcare by adding a premier spine platform to our portfolio of solutions,” said Dvorak. “We are confident that the combination of Zimmer Biomet’s Spine division and LDR will create a Spine company with the scale, talent and technology portfolio to become a leader in the $10 billion global spine market.”
Combined distribution channels in both the U.S. and international markets are expected to significantly enhance LDR’s customer reach. Christophe Levigne, co-founder, chairman, president, and CEO of LDR, said the deal with Zimmer Biomet will improve worldwide patient access to LDR’s innovative technology.
Larry Biegelsen, a Wells Fargo securities analyst in New York, told Bloomberg that the acquisition will capture an additional two percent of the global spine market for Zimmer Biomet — giving the company total of seven percent market share and moving it from sixth to fifth place in that sector. The transaction is expected to be complete by the third quarter of 2016.
Earlier this year, Zimmer Biomet completed deals to acquire Ortho Transmission and its portfolio of transcutaneous osseous integrated skeletal implants, as well as Cayenne Medical, a deal that boosts Zimmer Biomet’s sports medicine segment.
The company’s 3D-printed foot and ankle implant was approved by the FDA in February. Dvorak told investors in November that they could expect a “powerful pipeline” of innovative musculoskeletal solutions from Zimmer Biomet in 2016.