Boston Scientific Corp. (BSX) will acquire privately held company Cameron Health Inc., expanding its key heart-rhythm business.
Cameron Health developed the only commercially available subcutaeneous implantable defibrillator, which is an alternative to traditional defibrillators.
Boston Scientific will pay $150 million upfront and an additional potential $150 million upon the U.S. Food and Drug Administration's approval of Cameron's S-ICD system. The agreement also calls for up to an additional $1.05 billion in revenue-based milestone payments over a six-year period after FDA approval.
The deal is expected to close in the second or third quarter this year.
"The acquisition of Cameron Health builds on Boston Scientific's commitment to introducing innovation in the (cardiac rhythm management) space and represents an important part of our strategy to generate top-line revenue and market share growth," said Chief Executive Hank Kucheman.
Cameron's S-ICD system sits below the skin and doesn't touch the heart and blood vessels, while conventional implantable defibrillators require thin, insulated wires to pass through the venous system and into the heart.
The system has been commercially available in several major European countries since 2009. Cameron received expedited review status and submitted its application to the FDA in December. Boston Scientific anticipates FDA approval in the first half of 2013.
Last month, Boston Scientific reported fourth-quarter earnings fell 55% on sales declines in its heart-rhythm and drug-eluting stents businesses as the medical-device maker struggles to grow its revenue amid weakness in key markets.
Shares closed at $5.93 Thursday and were unchanged after hours. The stock is up 11% so far this year.
-By Nathalie Tadena, Dow Jones Newswires; 212-416-3287; email@example.com