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Wednesday, June 27, 2007

In Our Face

Take THAT, IN VIVO Blog.

Boston Scientific Corp., in an obvious thumbing of the nose to our suggestion that it wouldn’t be acquiring new companies any time soon, did just that.
The Natick, Mass. company reached an agreement to buy Remon Medical Technologies Inc., a privately held and venture-backed company based in Caesarea, Israel.

(We know. This is Karl Rove, not Jim Tobin.)

The acquisition shouldn't be seen as a sign that Boston Scientific is out shopping again. The company inherited a business agreement between Remon and Guidant Corp. established in 2004, long before Boston Scientific acquired the latter for $27 billion last year. Boston Scientific presumably is still busy fixing Guidant and identifying potential business to divest.

Boston Scientific clearly is excited at the potential of remote monitoring. CEO Jim Tobin singled out the former Guidant’s Latitude monitoring system in past speeches. Fred Colen, executive vice president of operations and technology, CRM and Chief Technology officer, said in a statement, “This acquisition reflects our commitment to being a leader in the CRM market through the introduction of innovative products and services for the benefit of physicians and their patients."

Read a lot more about Remon and other remote monitoring companies here. To sum up, the company has a platform to develop miniature devices capable of using ultrasound for a multitude of reasons from monitoring to drug delivery to tissue stimulation.

We may have more on the acquisition in the next START-UP. For now, here’s a quick Q&A with CEO Hezi Himelfarb and Terry McGuire, general partner at Polaris Venture Partners, one of Remon’s earlier investors. (Terms weren't disclosed, btw, but McGuire seemed very happy with the outcome.)

IN VIVO Blog: So who approached whom about merging?
McGuire: We already had relationship with Guidant that was going on a couple of years. And that turned out to be a prosperous relationship in the sense that we really developed some important technology that Boston Scientific recognized would continue to be important. And through the [Guidant] acquisition we got to know Boston Scientific even better and the time seemed right to talk about merging the companies.


IVB: Were there other opportunities for an exit? Did CardioMEMS failed IPO make a sale more appealing?
McGuire: CardioMEMS has a very different business model. CardioMEMS never entered into our relationship in any way. This acquisition was based on a relationship that had been evolving over two years. It’s what I would describe is a perfect baton pass. Here is this really innovative company and Boston Scientific saw what they could do with this. It was based on a long-term relationship. It really wasn’t based on the fact CardioMEMS did XYZ. Remon had a very strong balance sheet. It wasn’t like we needed to do anything.


IVB: Were there other options for Remon?
Himelfarb: We’ve been actually working on evaluating other [partnership] opportunities with other companies and there was a lot of interest in our technology because our technology is actually the only one today that provides real intrabody communication in a totally wireless manner …But eventually you can do such a deal with one company and luckily Boston Scientific was the one.


IVB: Where do you fit into BSX?
Himelfarb: Right now we are continuing exactly as we were. We continue to be in our facility which is located in Israel with the same employees, same management team. Everything actually remains the same. Then, probably again after a short-period of training and education we will find out what are the objectives. For now we are staying the same as before the acquisition.


IVB: Any changes within the next 12 months?
Himelfarb: I believe after they learn more about our technology they may do some changes in the focus of the company

1 comment:

Kim said...

I like your blog, it’s always fun to come back and check what you have to tell us today.