Medtronic to Acquire CathWorks for $585 Million to Advance AI-Powered Cardiovascular Diagnostics

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Recently, Medtronic, the world's largest medical technology company, announced that it will exercise its option to acquire CathWorks, an Israeli cardiovascular AI (artificial intelligence) imaging company, for up to $585 million (approximately 4 billion RMB), further strengthening its cardiovascular product portfolio.

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First Acquisition of the Year

This acquisition transaction is awaiting approval from the U.S. Federal Trade Commission (FTC). Medtronic expects to receive approval by the end of fiscal year 2026 (end of April), provided that all relevant regulatory approvals and other customary closing conditions are met. Prior to the completion of the transaction, both parties will continue to operate independently.

Medtronic and CathWorks have a long-standing relationship. Since 2018, Medtronic has held a minority stake in CathWorks. In July 2022, the two parties formed a strategic partnership, with Medtronic investing $75 million to gain marketing rights for the CathWorks FFRangio system in the United States, Europe, and Japan. According to the 2022 cooperation agreement, Medtronic has the option to acquire CathWorks in July 2027 upon reaching certain undisclosed milestones. The acquisition values CathWorks at up to $585 million, and undisclosed profit-sharing may occur after the transaction is completed.

Coronary physiological assessment is of great significance in improving patient outcomes. Fractional flow reserve (FFR) is a commonly used evaluation method that helps doctors identify ischemia-causing lesions and determine appropriate revascularization strategies for patients, avoiding unnecessary percutaneous coronary intervention (PCI). However, traditional wire-based FFR has limitations due to its invasive nature, requiring pressure wires, hyperemic agents, and being restricted to measurements from a single intravascular transducer position, which limits its application. The CathWorks FFRangio system takes an innovative approach by combining artificial intelligence (AI) with advanced computational science to provide a comprehensive physiological assessment of the entire coronary tree through routine coronary angiography (X-ray).

Jason Weidman, Senior Vice President and President of Medtronic's Coronary & Renal Denervation business, stated that through the joint promotion agreement, CathWorks has witnessed the disruption of the traditional wire-based FFR field by leveraging data and artificial intelligence, providing innovative solutions for doctors in every aspect from patient diagnosis to treatment. This acquisition will enable Medtronic to transform the catheterization lab with a technology that provides real-time data to guide personalized treatment plans and promote new standards of care.

CathWorks President and CEO Ramin Mousavi stated that the successful joint promotion over the past three years has brought significant opportunities to the coronary heart disease physiology market. With Medtronic's extensive global presence, the FFRangio system will reach more patients worldwide, and the merger of both parties will create a top-tier organization, completely transforming the standard of care in catheterization labs.

From a financial impact perspective, the acquisition is expected to have an immaterial impact on Medtronic's fiscal year 2027 GAAP and adjusted earnings per share, and thereafter will be neutral to accretive.

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Innovative Cardiovascular AI Imaging Company

CathWorks is a medical technology company headquartered in Kfar Saba, Israel, and was founded in 2013. The company focuses on developing cardiovascular imaging and treatment solutions based on computer vision and artificial intelligence technologies. It is committed to providing objective data for percutaneous coronary intervention (PCI) decision-making and enhancing coronary angiography from visual assessment to a decision-making tool based on FFR (fractional flow reserve).

CathWorks has been active in financing, completing multiple rounds of funding with a total amount exceeding 150 million US dollars. Its investors include well-known venture capital institutions such as Deerfield Management, Triventures, and Quark Venture. In 2022, Medtronic established a strategic partnership with CathWorks, investing 75 million US dollars and obtaining the marketing rights for the CathWorks FFRangio system in the United States, Europe, and Japan. Additionally, Medtronic has the option to acquire CathWorks for up to 585 million US dollars before July 2027. This acquisition by Medtronic was also based on this right.

The core product of CathWorks is the FFRangio system, a non-invasive coronary functional assessment platform based on artificial intelligence and advanced computational science. The system has the following characteristics:

• Non-invasive: The FFRangio system obtains physiological information through routine coronary angiography (X-ray) without the use of invasive pressure wires or pharmacological stimulation, thereby reducing patient risk and discomfort.
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• 3D Reconstruction: The system is capable of converting 2D angiography into an accurate 3D coronary artery tree model, providing comprehensive vascular anatomical information.
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• Real-time Hemodynamic Assessment: The FFRangio system can calculate the FFR value at each point of the coronary artery tree in real time, helping doctors assess the physiological impact of coronary artery stenosis, thereby making more accurate diagnostic and treatment decisions.
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• Optimize Clinical Decision-Making: The system provides physiological impact assessment of lesion treatment and interactive measurement tools, supporting physicians in making confident, patient-centered treatment decisions.
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• High Diagnostic Accuracy: Multiple clinical studies have shown that the FFRangio system has extremely high diagnostic accuracy, with results highly consistent with FFR measurements based on pressure wires.

The workflow of the FFRangio system includes:

• Data Collection: The system, based on an artificial intelligence platform, converts routine 2D angiography into an accurate digital 3D model of the coronary artery tree.
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• Hemodynamic Analysis: Evaluate blockages, 3D QCA (Quantitative Coronary Angiography), and flow resistance along each vessel through advanced algorithms.
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• FFR Value Calculation: Using validated scientific principles, rapid pressure-flow analysis calculates the FFR value at each point of the coronary artery tree to identify sections that may require intervention.
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• Result Display: The system generates a color-coded mapping grid, showing the FFR value at each location to help doctors intuitively understand the physiological condition of the coronary arteries.
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The FFRangio system has received 510(k) clearance from the U.S. Food and Drug Administration (FDA), approval from Israel's Ministry of Health (Amar), approval from Japan's Pharmaceuticals and Medical Devices Agency (PMDA), and meets the requirements for the European Union CE mark. Additionally, CathWorks has obtained ISO 13485 (Medical Device Quality Management System) and ISO 27001 (Information Security Management System) certifications.

CathWorks actively promotes the clinical research of the FFRangio system to verify its safety and effectiveness. For example, the ALL-RISE study is a randomized controlled trial conducted across 59 centers in the United States, Asia, Europe, and the Middle East, enrolling 1,924 patients to evaluate the clinical and economic benefits of FFRangio in diagnosing and treating coronary artery disease. The results of this study are expected to redefine the standard of care for coronary physiology assessment.

As one of the largest medical technology companies globally, how will Medtronic strengthen its presence in the cardiovascular field through the acquisition of CathWorks? Will this acquisition enable Medtronic to integrate CathWorks' advanced technology to enhance the efficiency of coronary heart disease diagnosis and the level of personalized treatment? Medical Device News will continue to follow up.