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Medtronic to acquire HeartWare for more than $1 billion

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Medtronic will acquire heart-pump manufacturer HeartWare in a transaction valued at approximately $1.1 billion, according to a press release issued by both companies.

Under terms of the agreement, Medtronic will tender an offer for all outstanding shares of HeartWare stock for $58 per share, and the transaction is expected to be completed during Medtronic’s second fiscal quarter, which ends Oct. 28, according to the release.

Medtronic stated in the release that it expects to expand its portfolio of diagnostic tools, therapies and services for patients with HF, and to strengthen its strategy of surrounding physicians with innovative products.

According to the release, HeartWare’s signature product is the HVAD system, which includes the world’s smallest full-support ventricular assist device and is designed to reduce surgical invasiveness, improve recovery times and enhance patient outcomes. Medtronic estimates the global market for full-support ventricular assist devices to be $800 million and growing.

“HeartWare’s HVAD system enhances the portfolio of our cardiac and vascular group, a team with ... a demonstrated ability to scale early stage concepts into large, sustainable end markets,” Omar Ishrak, chairman and chief executive officer, Medtronic, said in the release. Doug Godshall, president and chief executive officer of HeartWare, said in the release that the agreement “will expand access to our therapies and offerings to the sizable [HF] population.”

According to the release, U.S. health care expenditures for HF are approximately $39 billion per year, and Medtronic estimates the number of U.S. patients with HF could exceed 8 million by 2030.