J&J buys stroke device firm

Johnson & Johnson (J&J) has entered into an agreement to buy the California-based cardiovascular device maker Micrus Endovascular Corporation, which develops minimally invasive devices to treat haemorrhagic and ischemic stroke.

Micrus' flagship product line consists of bioactive microcoils that deploy inside a patient's aneurysm, becoming a scaffold that conforms to the aneurysm's shape and size. The company also sells other implantable and disposable devices, such as stents, balloon catheters, guide catheters, microcatheters and guidewires.

The acquisition deal calls for J&J to pay $23.40 per share of Micrus, valuing the total transaction at about $480m. The deal is expected to close this calendar year and to range between level and slightly dilutive compared to J&J's 2010 earnings.

After the closing, Micrus will become part of Codman & Shurtleff, the neuro device business of J&J's DePuy Family of Companies. Codman & Shurtleff develops and markets a number of products for the diagnosis and treatment of neurological disorders, including chronic pain management, adult and paediatric hydrocephalus, neuro critical care, aneurysm and stroke prevention and management.

"The combined business of Codman and Micrus Endovascular will provide a strong suite of solutions for hemorrhagic stroke, with many promising products in development for ischemic stroke," J&J noted.

The large majority of strokes – nearly 90 per cent – are ischemic, meaning that they occur as a result of arterial blockage or narrowing. Haemorrhagic stroke occurs when a brain aneurysm bursts.

Meanwhile, J&J's Ethicon Endo-Surgery said it has completed the sale of its breast cancer business to Devicor Medical Products, a portfolio company of the private equity investment firm GTCR Golder Rauner. About 300 J&J employees will be moved to Devicor.