Summary
Boston Scientific Corporation (BSX) announced on May 9, 2019, its definitive agreement to acquire Vertiflex, Inc., a company specializing in minimally invasive treatments for lumbar spinal stenosis (LSS). This strategic acquisition, valued at $465 million upfront plus milestone payments, significantly expands BSX's presence in the pain management and neuromodulation market, particularly targeting chronic pain patients. The Superion® Indirect Decompression System, Vertiflex's flagship product, is expected to generate $60 million in sales in 2019 and complements BSX's existing offerings like spinal cord stimulation and radiofrequency ablation. From an investor's perspective, this move demonstrates BSX's commitment to growth through strategic tuck-in acquisitions in attractive, high-growth medical device segments. While the acquisition is anticipated to be immaterial to adjusted earnings per share in 2019 and 2020, it is projected to become accretive thereafter. Investors should note that GAAP earnings may be impacted by amortization and acquisition-related charges. The deal is expected to close by the end of Q2 2019, subject to customary conditions, signaling continued M&A activity and expansion of BSX's product portfolio to address unmet patient needs.
Key Highlights
- 1Boston Scientific (BSX) to acquire Vertiflex, Inc., a leader in minimally invasive treatments for lumbar spinal stenosis (LSS).
- 2Transaction includes $465 million in upfront cash, with additional payments contingent on commercial milestones over three years.
- 3Vertiflex's Superion® Indirect Decompression System is projected to achieve $60 million in sales in 2019.
- 4Acquisition strengthens BSX's position in the pain management and neuromodulation market.
- 5The deal is expected to close by the end of Q2 2019, subject to closing conditions.
- 6The acquisition is anticipated to be immaterial to adjusted EPS in 2019-2020, becoming accretive thereafter.
- 7GAAP earnings may be impacted by amortization expense and acquisition-related charges.