Stryker Acquires Inari Medical for $4.9 Billion to Expand into Peripheral Vascular Market

Source: Medical Device Business Review

Author: Yu Bai

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Just stepping into 2025, "M&A King" Stryker has announced重磅消息——将以高达49亿美元（折合人民币约35.9 billionyuan) in an all-cash acquisition of industry leader Inari Medical.

StrykerYesSecond Largest in the WorldLarge orthopedic device companies, alsoFifth GloballyLarge medical device company, with a market value as high as 138 billion US dollars (approximately 1 trillion RMB), surpassing the medical device giant Medtronic, and is hailed as "King of Market Value", whileInari Medical is highly renowned in the field of peripheral vascular.

If compared with the transaction amounts of last year's top 10 M&A events in the medical device industry, this acquisition ranks just behind Johnson & Johnson and BD, firmly placing it among the top three in M&A deals.

Regardless of theBackground Strength, or fromScale MagnitudeFrom the perspective of this acquisition, there are plenty of highlights to look forward to.

"The acquisition of Inari expands Stryker's portfolio to provide life-saving solutions for patients with peripheral vascular disease," said Kevin Lobo, CEO of Stryker. "These innovations raise the standard of care for patients with venous thromboembolism and will accelerate Stryker's impact in endovascular procedures."

According to informed sources, Inari has been working with advisors in recent weeks to explore a sale.

This transaction has been approved by the boards of directors of both companies and is expected to be completed by the end of the first quarter of 2025.

Affected by this news, Inari Medical's stock price during normal trading hoursSurged by more than 30%, and in extended tradingIncreased by 21%。

Notably, prior to this rally, Inari's stock price had been on a "downward slope" for three years, and its net profit has yet to "turn from loss to profit."

Stock Price Trend

Trend of Net Profit Attributable to Shareholders

So, given the seemingly unclear development prospects of Inari Medical at present, why is Stryker so "particularly fond" of it that they are willing to make a high-profile and premium acquisition?

Speaking of which, the last time Stryker and Inari Medical "shared the stage" was in April last year.

At that time, the well-known foreign media massdevice selected "10 new innovative medical devices worth watching in 2024."Inari Medical's Arterial Thrombectomy and Stryker's Surgical Robot Products Selected Together, with the remaining entries being cutting-edge products from companies such as Boston Scientific, Medtronic, Edwards, Dexcom, Zimmer Biomet, and Alcon.

Inari Medical's Arterial Thrombectomy System Artix includes the FlowSaver Blood Return System (FDA approved in February 2023 and July 2023), the Artix AX Aspiration Catheter (FDA approved in March 2023), as well as the Artix MT Mechanical Thrombectomy Device and Artix Thin-Wall Thrombectomy Sheath (both FDA approved in October 2024).

IArtix MT Mechanical Thrombectomy Catheter and Artix Thin-Wall Thrombectomy Sheath, as shown in the figure.

The Artix MT Thrombectomy Device is suitable for non-surgical removal of emboli and thrombi from blood vessels. It can also be used to inject, infuse, or aspirate contrast agents and other fluids into or from blood vessels.

According to Inari, the flow rate of this sheath isFourfold. The potential market for the product in the United States is approximately$600 million.

Although the aforementioned product is already impressive, in fact, the product belongs to the acute limb ischemia (ALI)"Just Inari's Emerging Therapies Division""One of"。

Inari stated that the remaining TAM in the U.S. is approximately $1.5 billion for chronic limb-threatening ischemia (CLTI, treated with Inari’s LimFlow system), about $1 billion for dialysis access management (DAM), and another $1 billion for chronic venous disease (CVD).

Each year, 80,000 patients in the United States experience ALI or other peripheral vascular arterial thromboembolism, such as acute visceral ischemia and certain chronic limb ischemia.

In terms of revenue, Inari Medical is expected to generate $603 million in 2024 (approximately RMB4.4 billion), while in 2023 it was US$494 million, and in 2022 it was US$383 million. The company's revenue in 2019 was US$51 million (approximately RMB370 Million）。

In just five years, the performance increase reached an impressive 1082.35%. At this rate, Inari Medical's turnaround to profitability is within reach.

Moreover, the demand for medical implant devices is surging. An increasing number of Americans, especially the elderly, are opting to undergo surgeries that were postponed before the COVID-19 pandemic, which will significantly drive the growth in surgical volumes.

This acquisition also marks Stryker's official entry into the peripheral market, and it can highly complement Stryker's strong neurointerventional products.

Throughout Stryker's development history, after more than half a century of iterations, Stryker's current business territory has expanded from orthopedics to surgery and even neurosurgery. Compared to the former, the latter contributes a larger portion to the business.

Stryker 2023 Annual Report

In the third-quarter financial report of 2024, Stryker's Medical Surgical and Neurotechnology segments performed exceptionally well, with net sales reaching $3.22 billion, a year-over-year increase of 12.8%.

Behind the robust growth lies its exceptional strategic vision, the courage to expand globally, and the consistent focus on cutting-edge product iteration experience.

Looking back at the past year, Stryker has initiated 8 acquisitions worldwide, covering the fields of orthopedics and neuroscience.

The acquisition targets include bothNeurotechnology CompanyNico Corporation, also known asChronic Low Back Pain TreatmentDeveloper Vertos Medical, andAI-Assisted Virtual Care CompanyCare.ai, as well as focusing onSoft Tissue Fixation Company for Foot, Ankle, and Sports Medicine SurgeryArtelon, etc.

At the earnings conference at the end of July, Stryker CEO Kevin Lobo revealed that the company plans to carry out multiple merger and acquisition transactions in the second half of this year and has the idea of expanding into the soft tissue field.

Lobo frankly admitted on the earnings call, given thatStryker, with the great success of its Mako system in the field of orthopedic surgical robots (hard tissue surgical robots), hopes to continue expanding into other areas.PotentialThe M&A target may involveSoft Tissue Surgical Robotics Company。

While aggressively expanding, the company's innovative products are also entering the harvest period.

In August last year, Stryker launched the Pangea Plate Fixation System, which received FDA approval by the end of 2023.

CEO Kevin Lobo emphasized that Pangea will be the driving force behind next quarter's revenue growth.

The Pangea System offers a variable angle plate fixation system suitable for different populations, with a comprehensive and adaptable product portfolio. With the Pangea System, Stryker has become a leading partner in trauma-related products.

Surgeon Hsu praised it as a "game changer."

In June last year, Stryker also launched the LIFEPAK 35 Monitor/Defibrillator, a device that utilizes advanced technology aimed at improving workflow efficiency and providing advanced clinical solutions for first responders and healthcare professionals.

In addition, the company launched the Gamma4 hip fracture nail system in Germany on June 4.

The product launch is not the final outcome; expanding the product to the international market and achieving regional localization results are.

In the 2023 financial report, Stryker's international business revenue increased by 10.9%. Although the contribution from its domestic U.S. business still accounts for the majority, to further expand the market, the broader international business undoubtedly needs to continue driving growth.

In 2021, Stryker announced that its InSpace has officially received FDA approval, becomingThe World's FirstBalloon Implant for Arthroscopic Treatment of Massive Irreparable Rotator Cuff Tears (MIRCT).

InSpace can be implanted under the acromion through minimally invasive surgery to restore shoulder joint balance, effectively and continuously reduce pain, and increase range of motion without the need for sutures or fixation devices.Provides a new option for the continuous care of shoulder surgeons.

In July last year, the absorbable implantable balloon InSpace System developed and produced by Stryker was successfully approved for marketing in China.

This product is used to treat massive, irreparable full-thickness tears of the rotator cuff tendons caused by trauma or degeneration. It represents a globally pioneering technology, marking the official entry of China into the era of minimally invasive surgery for the treatment of massive irreparable rotator cuff tears.

This product has recently achieved a significant market breakthrough.After strict review by the National Healthcare Security Administration, InSpace has obtained the medical consumables coding for national health insurance (referred to as C-code), laying the foundation for obtaining the qualification for online procurement in various provinces.

Relevant disease statistics indicate that, globally, previous anatomical and epidemiological studies have found the incidence of rotator cuff tears to be 13% in 50-year-olds, 20% in 60-year-olds, and 31% in 70-year-olds.In China, the proportion of rotator cuff injuries among elderly people over 60 years old who seek medical treatment for shoulder pain is even higher.Up to 60%。

After the product is listed in various provinces in the future, Stryker's influence in the Chinese market will undoubtedly further increase.

Ending

Looking back three months ago, when the overall environment was still severe,Stryker once decided to slow down the layoff plan,The plant in Lakeland, Florida, which was originally scheduled to close before December 31, 2023The plant closure date has been postponed by 3 years.

From mergers and acquisitions to product commercialization, this medical device giant is relentlessly moving forward. With new strategies of addition and subtraction, it is evidently more ambitious, leaping towards the next peak through continuous transformation and reshaping.

Stryker's next M&A deal is likely already in the works.

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