By Ben Fox Rubin
St. Jude Medical Inc. (STJ) completed its purchase of Nanostim
Inc., a closely held maker of wireless pacemakers, providing the
medical-device company with a less invasive pacemaker design.
The company paid $123.5 million for Nanostim, and the deal
provides up to $65 million in additional cash payments contingent
on certain revenue-based milestones.
The Nanostim pacemaker is delivered using a steerable catheter
through the femoral vein, eliminating the need to surgically create
a pocket for the pacemaker and insulated wires--called leads--that
historically have been recognized as the most vulnerable component
of pacing systems, St. Jude said.
The Nanostim leadless pacemaker also is less than 10% the size
of a conventional pacemaker.
The device recently received CE Mark approval in Europe and will
be available soon in some markets there. It also received U.S. Food
and Drug Administration conditional approval for its
investigational device exemption application and pivotal clinical
trial protocol to begin evaluating Nanostim leadless technology in
the U.S.
St. Jude has struggled in recent years as the economic downturn
led to pricing pressures in the U.S. and Europe and some consumers
delaying medical treatment. Meanwhile, the company's implanted
defibrillators--representing a third of total revenue--suffered as
critics raised doubts about the safety of a key product
component.
In the second quarter, St. Jude's total sales fell but still
exceeded Wall Street analysts' projections. The results were driven
almost entirely by the company's line of implanted defibrillators
and pacemakers, which handily beat projections despite safety
concerns.
Write to Ben Fox Rubin at ben.rubin@wsj.com
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