Thoratec buys Terumo's heart tech for up to $56.5M
|Thoratec has purchased Terumo's DuraHeart II pump.--Courtesy of Terumo|
Unsatisfied with all its HeartMate success, Thoratec ($THOR) is spending cash to further its share of the left ventricular assist device market, shelling out up to $56.5 million for Terumo's investigational DuraHeart II.
Thoratec will pay $13 million up front for the heart pump and dish out up to $43.5 million more depending on regulatory approvals and device sales, the company said. In exchange, it gets the DuraHeart II, a ventricular pump that uses magnetic forces to regulate blood flow, which Terumo said has helped it control bleeding and thrombosis in preclinical trials.
The device has yet to reach the market anywhere in the world, and Thoratec expects to spend up to $7 million on R&D in the second half to advance the implant, bringing on a team of Terumo employees to speed the transition. Once DuraHeart II picks up some clearances around the globe, the two will enter a distribution agreement in which Terumo will sell the device in Japan and other parts of Asia.
Thoratec has its eye on 2016 for a first-in-human study of DuraHeart II, followed by large-scale trials in the U.S. and abroad.
"DuraHeart II brings a differentiated approach to mechanical circulatory support to Thoratec's R&D portfolio and will be an integral component of our product development strategy, along with continued evolution of the HeartMate II system, next-generation pump platforms including HeartMate III and HeartMate PHP," Thoratec CEO Gary Burbach said in a statement.
And the company could use some diversification. As it stands, HeartMate and its iterations account for about 80% of Thoratec's annual revenue, and sluggish demand pulled the company's first-quarter sales down 7% to $117.7 million. But Thoratec still expects revenue to grow 4% to $510 million in 2013, banking on an expanded demand for its LVADs.
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