USA – Dublin-based device maker Medtronic has completed the US$1.1 acquisition of medtech firm Intersect ENT after satisfying US Federal Trade Commission’s (US FTC) regulatory conditions.
The FTC announced earlier this week that Medtronic would have to divest an Intersect subsidiary—selling surgical navigation company Fiagon to the biotech firm Homeostatis—in order to obtain approval for the acquisition.
Intersect, based in Menlo Park, California, is dedicated to the advancement of ear, nose, and throat treatment.
However, the FTC expressed concern that Medtronic’s acquisition of the company would result in less innovation and higher healthcare costs.
According to Holly Vedova, director of the FTC’s Bureau of Competition, Medtronic is the leading provider of ENT navigation systems.
The FTC ordered Medtronic to sell Fiagon within 10 days of acquiring Intersect.
Medtronic also creates and sells balloon sinus dilation devices, which are used by doctors to clear blocked sinuses.
Meanwhile, with Intersect now firmly under the Medtronic umbrella, the FTC has barred Medtronic from acquiring any other ENT navigation or balloon sinus dilation technology without its express permission for the next decade.
Medtronic offered US$28.25 in cash for each of Intersect’s outstanding shares in August 2021, kicking off the merger. This represented a 15% premium over the target’s stock price at the time, for a total of US$1.1 billion.
Following more than a decade of preparation, Medtronic received approval to proceed after agreeing to the agency’s terms.
Medtronic made its first investment in Intersect in 2010. Since then, it has maintained a close relationship with Intersect, and investors have long speculated that Medtronic might acquire the company.
Finally, in August of last year, Medtronic announced that it would proceed with the acquisition, which it has now completed.
According to Medtronic, the device maker found Intersect’s steroid-coated stents to be particularly appealing.
Chronic rhinosinusitis, a common chronic condition in which spaces inside the nose and sinuses become inflamed, causing symptoms ranging from a lingering cold to headache, is treated with sinus implants.
The Propel sinus implants from Intersect are used in conjunction with sinus surgery, whereas the Sinuva implants are a nonsurgical treatment for nasal polyps, noncancerous growths lining the nose and sinuses. Intersect was the first company to receive FDA approval for such devices.
Medtronic stated that the acquisition will broaden its device portfolio and improve care for patients suffering from chronic sinusitis.