On April 5, Johnson & Johnson (NYSE:JNJ) announced that it had agreed to acquire Shockwave Medical, Inc. for $335.00 per share in cash.Cardiovascular Device Public CompaniesShockwave Medical (NASDAQ:SWAV) has acquired all issued shares, representing an enterprise value of approximately $13.1 billion including the acquisition cash. This transaction has been approved by the boards of both companies.Johnson & JohnsonWill be carried out through Shockwave MedicalJohnson & JohnsonWholly-owned subsidiary merger, funding this transaction through a combination of cash on hand and debt.Gold. The transaction is expected to be completed by the middle of 2024, and Shockwave will operate as a business unit of Johnson & Johnson Medical Technologies. On March 26, the Wall Street Journal reported that Johnson & Johnson intended to acquire.Shockwave，It is expected that Johnson & Johnson will be the global leader in medical devices in 2024, while Medtronic might drop from first to second place.Last year, media reports claimed that Johnson & Johnson, Medtronic, and Boston Scientific were potential bidders.In 2023, Shockwave Medical's revenue reached $730 million, increasing nearly 50% year-over-year.
The deal is expected to enhance Johnson & Johnson's leading position in the medical technology field through Shockwave Medical's Intravascular Lithotripsy (IVL) technology, which is used to treat arterial diseases.
The acquisition of Shockwave further expandsJohnson & Johnson MedicalIn the field of cardiovascular intervention, and has accelerated its transformation into a high-growth market. Cardiovascular intervention is one of the fastest-growing medical technology markets globally, with severely unmet patient needs. With the addition of Shockwave, Johnson & Johnson will expand its MedTech cardiovascular product portfolio into two of the highest growth, innovation-driven fields of cardiovascular intervention—coronary artery disease (CAD) and peripheral artery disease (PAD). Previously, Johnson & Johnson Medical successfully acquired Abiomed (Johnson & Johnson Acquires Abiomed for $16.6 Billion, Abiomed's Stock Price Surges 50%), as well as last year's $400 million upfront acquisition of Laminar, an innovator in eliminating the left atrial appendage for non-valvular atrial fibrillation (AFib) patients. These acquisitions complement and solidify Johnson & Johnson's established global leadership in the field of electrophysiology through its Biosense Webster portfolio. Upon completion of the transactions, Johnson & Johnson Medical will become the category leader in four high-growth cardiovascular areas.
Shockwave is a leading, first-to-market supplier of innovative Intravascular Lithotripsy (IVL) technology for the treatment of calcification.Coronary Artery Disease (CAD) and Peripheral Artery Disease (PAD)）IVL is a catheter-based minimally invasive treatment for calcified arterial lesions, which can reduce blood flow and lead to pain or heart attacks. IVL helps restore blood flow by using sound waves to break up calcium deposits and is used in CAD and PAD, often in combination with stenting. Shockwave Medical offers the only commercially available IVL technology, which has safely, simply, and effectively treated approximately 400,000 patients worldwide. In addition to its leading IVL platform, Shockwave recently acquired Neovasc, the developer of the Reducer System, a novel product focused on alleviating symptoms of refractory angina.Reducer SystemIts commercial influence is growing. It is currently undergoing clinical research in the United States and has obtained CE certification in the EU and the UK.
Johnson & Johnson Chairman and CEO Joaquin Duato stated:"Johnson & Johnson, which focuses on innovative medicine and medical technology, has a long history in addressing cardiovascular disease, the leading cause of death globally. The acquisition of Shockwave Medical and its leading IVL technology provides a unique opportunity to accelerate our impact in cardiovascular interventions and deliver greater value to patients, shareholders, and healthcare systems."Tim Schmid, Executive Vice President and Global Chairman of Johnson & Johnson Medical Technologies, stated:"Shockwave provides a truly differentiated opportunity to further enhance our leadership in the medical technology field, expand into other high-growth areas, and ultimately transform the future of cardiovascular treatment. Shockwave's IVL technology for treating CAD and PAD, along with its robust pipeline, is unique. We look forward to bringing Shockwave’s solutions to Johnson & Johnson Medical Technologies and to more physicians around the world."Doug Godshall, President and CEO of Shockwave Medical, said:"Through the groundbreaking development of intravascular lithotripsy, Shockwave has transformed the treatment of complex calcified arterial disease. Our mission is to deliver this exceptional technology to patients worldwide. As part of a larger and more diversified organization, we possess extensive expertise and are committed to improving patient outcomes. We are confident in further establishing IVL as the global standard for patient care. I am deeply grateful to our team members and colleagues, whose efforts have made today’s milestone possible; their achievements and passion are extraordinary. As the Shockwave team prepares to write its next exciting chapter, I cannot think of a better partner and home than Johnson & Johnson."Consolidated Johnson & Johnson Medical's leadership position in cardiovascular interventions:IVL is the only technology that can simultaneously treat intimal and medial calcification, and Shockwave has provided the first and only commercial IVL platform for CAD and PAD. This acquisition will complement Johnson & Johnson's leadership in cardiac recovery (Abiomed) and electrophysiology (Biosense Webster), making it a category leader in the four largest and fastest-growing medical technology markets in the field of cardiovascular intervention.
Through complementary cooperation with Johnson & Johnson, the opportunity to serve patients worldwide has increased.Shockwave's IVL and Abiomed's Impella® heart pump platform play a critical role in complex percutaneous coronary interventions (PCI). Specifically, IVL is used in approximately 30% of high-risk PCI cases, which also currently utilize the Impella®. This clinical compatibility, combined with Johnson & Johnson’s established global commercial infrastructure, offers numerous opportunities to accelerate the application of these market-leading technologies to patients in need.
Provides a strong channel for future growth in untapped markets:Shockwave Medical Benefits from a Strong Channel Focused on the Continuous Innovation and Expansion of CAD and PAD Product Portfolios, as well as the Potential Use of IVL in New Indications Such as Carotid Artery Disease and Structural Heart Disease in the Coming Years. Shockwave Medical is Also Evaluating its Reducer System Technology in Clinical Studies to Treat Patients with Refractory Angina.
Accelerate Sales Growth:The acquisition of Shockwave Medical accelerates Johnson & Johnson Medical's ongoing efforts in high-growth markets with unmet needs, while expanding its reach and scale globally. The proposed transaction adds a high-performance business in a low-penetration category, which features a strong pipeline and attractive growth and profit margins. The deal is expected to accelerate the revenue growth of both Johnson & Johnson and Johnson & Johnson Medical. Shockwave is ultimately expected to become the thirteenth priority platform of Johnson & Johnson Medical, with annual sales of at least $1 billion.
Achieve Operational Value-added Immediately:The transaction will increase Johnson & Johnson's operating profit. Johnson & Johnson expects the deal to be accretive to operations upon completion, but considering the impact of financing costs, it is expected to dilute the adjusted earnings per share by approximately $0.10 in 2024 and by approximately $0.17 in 2025.
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