Medical-devicemaker St. Jude Medical, St. Paul, Minn., has struck a deal to pay $60 million to acquire a 19% ownership interest in Atlanta-based cardiovascular-device manufacturer CardioMEMS.
The agreement includes an exclusive option for St. Jude to acquire the company in whole for an additional $375 million payment, which would be made in conjunction with CardioMEMS' completion of certain commercialization milestones, according to a news release.
CardioMEMS is the developer of an implantable wireless technology that can be used to remotely monitor heart-failure patients. In a study sponsored by the devicemaker, heart patients who received the implantable monitor had a 30% reduction in the rate of heart-failure-related hospitalizations within the first six months of implantation. The study also found a 38% annual reduction in heart-failure hospitalizations among those patients.
Food and Drug Administration approval of the technology is pending. The equity investment is expected to have no effect on St. Jude's 2010 earnings outlook.