St. Jude Medical Inc.
) revealed that it has completed acquiring privately held chronic
pain solutions maker NeuroTherm for cash payment of roughly $200
million. However, shares of St. Jude Medical slid 2.6% following
the announcement till the last trading session.
The acquisition boosted St. Jude Medical's chronic pain portfolio
and made it the only medical device producer with a chronic pain
portfolio that offers both radiofrequency ablation (RFA) for spinal
pain and spinal cord stimulation.
NeuroTherm uses minimally invasive RFA, a medical procedure aimed
at reducing back pain by pinpoint application of heat using radio
frequency waves on nerves around the facet joints. With this, the
method helps destroying the ability of the nerves to send pain
signals to the brain, a process known as ablating the nerves.
RFA technique is being used for over 25 years for interventional
pain therapy for chronic pain patients. About 1.5 billion people
around the world suffer from chronic pain. Last year, there were
230 million patients in the U.S. suffering from chronic pain.
NeuroTherm's products are available in more than 65 countries. Its
facilities are located in the metro-Boston area, Amsterdam,
Dusseldorf, and London.
St. Jude Medical had previously revealed that the acquisition of
NeuroTherm is expected to contribute $10 to $15 million its sales
in 2014. The acquisition is expected to be neutral to St. Jude
Medical's earnings per share in 2014 but accretive thereafter.
Recently, St. Paul, MN-based St. Jude Medical also completed its
acquisition of privately-held CardioMEMS, Inc. following the U.S.
Food and Drug Administration (FDA) clearance of the CardioMEMS HF
System in May this year. With the closure of the CardioMEMS
acquisition, St. Jude Medical expects accelerated growth in its
The CardioMEMS HF System is a first-of-its-kind FDA-approved heart
failure monitoring device that has been proven to significantly
reduce heart failure-related hospitalizations. It has set a new
treatment paradigm for heart failure that reduces the need for
The CardioMEMS HF System has already obtained the CE Mark approval
in the EU. St. Jude Medical now plans to initiate the system's
strategic launch in the U.S.
Currently, St. Jude Medical carries a Zacks Rank #3 (Hold). Some
better-ranked stocks in the medical products industry include
Hospira Inc. (
), Medtronic, Inc. (
) and Symmetry Medical, Inc. (
). All of them carry a Zacks Rank #2 (Buy).
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