Acquisition to expand endoluminal surgery
portfolio and add differentiated technologies for endobariatric
procedures
MARLBOROUGH, Mass., Nov. 29,
2022 /PRNewswire/ -- Boston Scientific Corporation
(NYSE: BSX) today announced it has entered into a definitive
agreement to acquire Apollo Endosurgery, Inc. (Nasdaq: APEN) for a
cash price of $10 per share,
reflecting an enterprise value of approximately $615 million.1
The Apollo Endosurgery product portfolio includes devices used
during endoluminal surgery (ELS) procedures to close
gastrointestinal defects, manage gastrointestinal complications and
aid in weight loss for patients suffering from obesity. ELS
provides a less-invasive alternative to open and laparoscopic
surgery for patients with diseases in the gastrointestinal tract or
morbid obesity, while providing the potential for quicker recovery
and minimizing the risks of surgical
complications.2,3,4
"Endoluminal surgery is an emerging field and a core focus for
our Endoscopy business," said Mike
Jones, senior vice president and president, Endoscopy,
Boston Scientific. "We intend to expand our global capabilities in
ELS with the differentiated innovation that Apollo Endosurgery
offers, and we will continue to focus on procedural adoption as
well as professional education in this exciting space. This
acquisition also enables us to enter a new adjacency – the
endobariatric market – and deliver strong, continued growth across
our business."
Apollo Endosurgery is expected to generate net sales of
approximately $76 million in
2022,5 as a result of the expected growth in its
endoscopic suturing system franchise, including its OverStitch™
Endoscopic Suturing System, OverStitch Sx™ Endoscopic Suturing
System and X-Tack™ Endoscopic HeliX Tacking System.6
In July 2022, Apollo Endosurgery
received U.S. Food and Drug Administration (FDA) de novo clearance
for its Apollo ESG™, Apollo ESG Sx™, Apollo REVISE™ and Apollo
REVISE Sx™ Systems, the first devices authorized by the FDA for
endoscopic sleeve gastroplasty (ESG) and endoscopic bariatric
revision procedures. The company's endobariatric portfolio also
includes the Orbera® Intragastric Balloon for endoscopic
weight management.
Boston Scientific expects to complete the transaction in the
first half of 2023, subject to satisfaction of customary closing
conditions. The impact to Boston Scientific's adjusted earnings per
share is expected to be immaterial in 2023, and accretive
thereafter. The impact to GAAP earnings per share is expected to be
less accretive, or more dilutive, as the case may be, due to
amortization expense and acquisition-related net charges.
About Boston Scientific
Boston Scientific
transforms lives through innovative medical solutions that improve
the health of patients around the world. As a global medical
technology leader for more than 40 years, we advance science for
life by providing a broad range of high performance solutions that
address unmet patient needs and reduce the cost of healthcare. For
more information, visit www.bostonscientific.com and
connect on Twitter and Facebook.
Cautionary Statement Regarding Forward-Looking
Statements
This press release contains forward-looking
statements within the meaning of Section 27A of the Securities Act
of 1933 and Section 21E of the Securities Exchange Act of 1934.
Forward-looking statements may be identified by words like
"anticipate," "expect," "project," "believe," "plan," "estimate,"
"intend" and similar words. These forward-looking statements are
based on our beliefs, assumptions and estimates using information
available to us at the time and are not intended to be guarantees
of future events or performance. These forward-looking statements
include, among other things, statements regarding the financial and
business impact of the transaction, product launches and product
performance and impact. If our underlying assumptions turn out to
be incorrect, or if certain risks or uncertainties materialize,
actual results could vary materially from the expectations and
projections expressed or implied by our forward-looking statements.
These factors, in some cases, have affected and in the future
(together with other factors) could affect our ability to implement
our business strategy and may cause actual results to differ
materially from those contemplated by the statements expressed in
this press release. As a result, readers are cautioned not to place
undue reliance on any of our forward-looking statements.
Factors that may cause such differences include, among other
things: future economic, competitive, reimbursement and regulatory
conditions; new product introductions; expected procedural volumes;
demographic trends; the closing and integration of acquisitions;
intellectual property rights; litigation; financial market
conditions; the execution and effect of our business strategy,
including cost savings and growth initiatives; and future business
decisions made by us and our competitors; the conditions to the
completion of the proposed transaction, including the receipt of
the required regulatory approvals and clearances, may not be
satisfied; closing of the proposed transaction may not occur or may
be delayed. All of these factors are difficult or impossible to
predict accurately and many of them are beyond our control. For a
further list and description of these and other important risks and
uncertainties that may affect our future operations, see Part I,
Item 1A – Risk Factors in our most recent Annual
Report on Form 10-K filed with the Securities and Exchange
Commission ("SEC"), which we may update in Part II, Item 1A
– Risk Factors in Quarterly Reports on Form 10-Q
we have filed or will file hereafter. We disclaim any intention or
obligation to publicly update or revise any forward-looking
statements to reflect any change in our expectations or in events,
conditions or circumstances on which those expectations may be
based, or that may affect the likelihood that actual results will
differ from those contained in the forward-looking statements. This
cautionary statement is applicable to all forward-looking
statements contained in this press release.
Additional Information and Where to Find It
In
connection with the proposed transaction, Apollo intends to file
with the SEC preliminary and definitive proxy statements relating
to the proposed transaction and other relevant documents. The
definitive proxy statement will be mailed to Apollo's stockholders
as of a record date to be established for voting on the proposed
transaction and any other matters to be voted on at the special
meeting. BEFORE MAKING ANY VOTING DECISION, INVESTORS AND SECURITY
HOLDERS ARE URGED TO READ THE DEFINITIVE PROXY STATEMENTS, ANY
AMENDMENTS OR SUPPLEMENTS THERETO, ANY OTHER SOLICITING MATERIALS
AND ANY OTHER DOCUMENTS TO BE FILED WITH THE SEC IN CONNECTION WITH
THE PROPOSED TRANSACTION OR INCORPORATED BY REFERENCE IN THE PROXY
STATEMENTS WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN
IMPORTANT INFORMATION ABOUT APOLLO, BOSTON SCIENTIFIC AND THE PROPOSED
TRANSACTION. Investors and security holders may obtain free copies
of these documents (when they are available) on the SEC's web site
at www.sec.gov.
CONTACTS:
Nate Gilbraith
Media Relations
(701) 212-9589
nate.gilbraith@bsci.com
Lauren Tengler
Investor Relations
(508) 683-4479
BSXInvestorRelations@bsci.com
1 Enterprise value based on 41.7 million common
shares outstanding, 12.3 million warrants outstanding, conversion
of outstanding convertible debt, and vesting of shares under
Apollo's equity incentive plans for a total fully diluted share
count of approximately 64.8 million shares, implying $648 million for 100% of the fully diluted
equity, minus approximately $33
million net cash as of September
30, 2022.
2 Liu, Q., Ding, L., Qiu, X., & Meng, F. (2020).
Updated evaluation of endoscopic submucosal dissection versus
surgery for early gastric cancer: A systematic review and
meta-analysis. International journal of surgery (London, England), 73, 28–41.
https://doi.org/10.1016/j.ijsu.2019.11.027.
3 Jalal, M. A., Cheng, Q., & Edye, M. B. (2020).
Systematic Review and Meta-Analysis of Endoscopic Sleeve
Gastroplasty with Comparison to Laparoscopic Sleeve Gastrectomy.
Obesity surgery, 30(7), 2754–2762.
https://doi.org/10.1007/s11695-020-04591-4.
4 Hedjoudje, A., Abu
Dayyeh, B. K., Cheskin, L. J., Adam, A., Neto, M. G.,
Badurdeen, D., Morales, J. G., Sartoretto, A., Nava, G. L., Vargas,
E., Sui, Z., Fayad, L., Farha, J., Khashab, M. A., Kalloo, A. N.,
Alqahtani, A. R., Thompson, C. C., & Kumbhari, V. (2020).
Efficacy and Safety of Endoscopic Sleeve Gastroplasty: A Systematic
Review and Meta-Analysis. Clinical gastroenterology and
hepatology : the official clinical practice journal of the American
Gastroenterological Association, 18(5),
1043–1053.e4. https://doi.org/10.1016/j.cgh.2019.08.022.
5 Apollo Endosurgery, Inc. (2022). Q3 2022 Financial
results.
https://irp.cdn-website.com/da0ce818/files/uploaded/APEN%20Q3%202022%20Deck%2011.01.22%20%281%29.pdf.
6 Apollo Endosurgery, Inc. (2022). Form 10-Q.
https://app.quotemedia.com/data/downloadFiling?webmasterId=102691&ref=117026820&type=PDF&symbol=APEN&companyName=Apollo+Endosurgery+Inc.&formType=10-Q&formDescription=General+form+for+quarterly+reports+under+Section+13+or+15%28d%29&dateFiled=2022-11-01&CK=1251769.
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SOURCE Boston Scientific Corporation