Medtech Mergers and Acquisitions Abound in 2013

While 2012 was a tepid year for medical device company acquisitions, so far in 2013, there has been a considerable uptick in M&A activity.

Analysts believe that the 2012 M&A environment was dampened by overseas austerity measures, mounting uncertainty over the medical device tax and domestic pricing pressures. While these issues are still relevant in 2013, there have been more billion-dollar deals in the over the last 24 weeks than in all 12 months of last year.

Some prominent M&As of 2013 include Life Technology’s massive deal and Baxter’s entry into the world of dialysis. However, buyouts aren’t only happening on this massive level.

Dozens of device makers are looking to boost innovation and tighten up product lines. Amidst dwindling demand and reimbursement cuts, many in the industry are shedding one-valued business units. These operations are being scaled back for a few million dollars from a competitor. Emerging markets also play a significant role. Since FDA PMAs and lagging European demand can dampen balance sheets, many in the industry are looking towards Asian buyouts as an entry point to a fast-growing market.

Coincidentally, the upcoming MEDevice San Diego conference held in late September will provide advice to medical device companies looking to be acquired. In particular, Erich Wolff, Director of Business Development and Licensing at Covidien will give a talk titled “Tips on attracting a large manufacturer’s corporate development officers.

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