Novartis’ eye care business, Alcon, announced the acquisition of Transcend Medical, a medtech company developing minimally invasive surgical devices to treat glaucoma. Analysts speculate that the deal is part of Novartis CEO Joe Jimenez’s $200-million plan to boost Alcon’s innovative pipeline and spur growth.
Glaucoma refers to a variety of eye conditions that cause damage to the optic nerve, often through elevated intra-ocular pressure (IOP) levels. In 2013, several medical device companies — including Glaukos, AqueSys, InnFocus, and Transcend — began introducing innovative implant technology to reduce IOP and slow the progression of the disease, according to Ophthalmology Times. Though there are several micro-invasive glaucoma surgery (MIGS) devices currently in development, only Glaukos’ iStent is currently approved for use in the U.S.
Transcend’s CyPass Micro-Stent is indicated for less-severe cases of glaucoma and is used to enhance the drainage pathway into the suprachoroidal space. A recently concluded clinical trial found that the device met both its primary and secondary endpoints, demonstrating superiority to cataract surgery alone. Last May, Transcend announced that it would use that data to file a premarket approval (PMA) application with the FDA.
Newly appointed Alcon CEO Michael Ball said in a press release that the Transcend acquisition would establish Alcon’s place in the growing MIGS technology market.
“If approved, [the CyPass Micro-Stent] will provide less invasive means of lowering IOP than traditional invasive glaucoma surgery, with the goal of lowering the dependency of topical ocular medication,” Ball said. “This acquisition also expands Alcon’s leadership in glaucoma and cataract treatment as part of our surgical business.”
Ball’s appointment is part of a multi-stage strategy orchestrated by Jimenez to turn around Alcon’s recent slowdown in sales. Part of that strategy was a $200-million investment in Alcon, which Bloomberg predicted Ball would spend on acquisitions.
“The responsibility of turning Alcon around is rather too great to hang on Transcend alone,” said analysts firm EP Vantage. “But the acquisition will help move it away from the commoditized retail products it relies on now into true medical devices.”
Alcon represents half of all Novartis medical device sales, and analysts speculate that the company may be looking to get out of medtech, following the path Johnson & Johnson. Jimenez told Financial Times that a decision to sell Alcon would depend on 2016 sales numbers.
Over 3 million Americans suffer from glaucoma, but only half that population knows that they have the condition, according to the Glaucoma Research Foundation. Though doctors are able to treat the symptoms of the disease, currently there is no cure for what is the second-leading cause of blindness worldwide.