Varian Acquires Endocare and Alicon to Expand Integrated Interventional Oncology Solutions

Acquisition Highlights

Varian will establish an end-to-end interventional oncology solution, encompassing both hardware and software;

Varian will leverage its robust global platform to provide patients and users with a broader range of cancer treatment solutions;

Varian’s long-term strategy is to become the global leader in multidisciplinary, comprehensive cancer solutions, and this acquisition represents a significant step toward achieving that strategic objective.

VCBeat (WeChat ID: vcbeat) has learned that Varian (NYSE: VAR) acquired Endocare and Alicon on June 10 to expand its portfolio of multidisciplinary integrated cancer treatment solutions. Headquartered in Austin, Texas, Endocare is a leading provider of hardware and software solutions for cryoablation and microwave ablation. Alicon (Hangzhou Alicon Pharmaceutical Technology Co., Ltd.), based in Hangzhou, China, is a leading industry player in embolization therapy for liver cancer in China.

This acquisition positions Varian as a leader in the high-growth field of interventional oncology, which was valued at approximately $860 million in 2019 and is projected to exceed $1 billion by 2022. Varian will fully leverage the existing product portfolios of both companies, as well as the R&D projects conducted by teams in Austin and Hangzhou.

Varian’s vision is to create a world without fear of cancer by expanding global access to advanced cancer treatments, and this acquisition aligns with that long-term vision. The integrated team will drive innovation in interventional oncology, leveraging Varian’s robust global platform to provide patients and users with a broader range of cancer treatment solutions.

“Working together, this acquisition is a significant step in Varian’s long-term strategy to become the global leader in comprehensive, multidisciplinary cancer solutions,” said Dawei Wei, President and Chief Executive Officer of Varian. “We believe that the combined product portfolios and diverse R&D pipelines of the two companies will unlock new growth for Varian in the coming years and provide our clinical partners with more treatment options. Varian is also uniquely positioned to create an interventional oncology platform, offering integrated software and services for treatment planning to enable advanced interventional therapies.”

“We are thrilled to have the opportunity to join Varian,” said David Chen, CEO of Endocare and Alicon. “We share Varian’s mission to deliver innovative cancer treatment solutions. This transaction will strengthen our combined capabilities to develop the solutions needed to achieve this goal. On a personal note, I am deeply proud of the products developed by the Endocare and Alicon teams, and I look forward to expanding our positive impact on patients worldwide together with Varian.”

Endocare’s flagship product is CryoCare CS, an integrated cryotherapy system. Cryoablation is a specialized form of cryotherapy used for minimally invasive treatment of various cancers, including prostate cancer, renal cell carcinoma, lung cancer, liver metastases, and palliative interventions.

Alicon’s flagship product is Caligel, a gelatin sponge particle embolic agent. Alicon possesses a comprehensive infrastructure for research and development, manufacturing, and commercialization. Its solutions are utilized by over 1,000 large hospitals, providing treatment to 200,000 patients annually.

For this acquisition, Varian financed the $185 million purchase price using cash and proceeds from borrowings. Endocare and Alicon generated a combined $30 million in revenue during the 2018 calendar year. Varian expects that the aggregate impact of these transactions on its financial results for fiscal year 2019 will be immaterial, and that the integrated oncology intervention platform will be accretive to Varian’s GAAP and non-GAAP earnings per share in fiscal year 2020.