Johnson & Johnson (J&J) has entered into a definitive agreement to acquire US-based heart pump maker Abiomed for about $16.6bn in an all-cash deal.

Under the terms of the deal, shareholders of the NASDAQ-listed Abiomed will be offered an upfront payment of $380 per share. They will also get a non-tradeable contingent value right (CVR) worth up to $35 per share in cash if some commercial and clinical milestones are met.

The transaction is expected to strengthen Johnson & Johnson MedTech (JJMT) in the cardiovascular area, advancing the standard of care in heart failure and recovery.

Abiomed’s Impella heart pumps for the treatment of acute myocardial infarction (AMI) cardiogenic shock will complement JJMT’s portfolio, said Johnson & Johnson.

Johnson & Johnson CEO Joaquin Duato said: “The addition of Abiomed is an important step in the execution of our strategic priorities and our vision for the new Johnson & Johnson focused on Pharmaceutical and MedTech.

“We have committed to enhancing our position in MedTech by entering high-growth segments. The addition of Abiomed provides a strategic platform to advance breakthrough treatments in cardiovascular disease and helps more patients around the world while driving value for our shareholders.”

Johnson & Johnson said that the deal will also expedite its pro forma enterprise revenue growth as well as that of JJMT’s.

Upon completion of the transaction, Abiomed will run as a standalone business within JJMT, becoming one of the latter’s 12 priority platforms.

Abiomed chairman, president, and CEO Michael Minogue said: “This transaction partners us with an organization that shares our patients-first mindset and creates immediate value for our patients, customers, employees and shareholders. It will enable us to leverage Johnson & Johnson’s global scale, commercial strength and clinical expertise to accelerate our mission of making heart recovery the global standard of care.”

Expected to be completed by the end of Q1 2023, the deal is subjected to regulatory approvals and other customary conditions and the tender of a majority of the outstanding shares of Abiomed’s common stock.