Medical device firm St. Jude Medical is set to acquire California-based spinal cord stimulator maker Spinal Modulation, in a deal worth about $175m.
Spinal Modulation produces Axium Neurostimulator System that received CE mark approval in November 2011 to manage chronic and intractable pain.
St. Jude Medical will pay around $175m upon closing and additional payments will be made upon FDA approval of the Axium system and achievement of certain revenue targets.
The company signed a series of agreements in June 2013, under which it made a $40m equity investment in Spinal Modulation.
The deal provided St. Jude Medical with an exclusive option to acquire the company, in addition to providing it with an exclusive option to distribute the Axium Neurostimulator System in international markets.
St. Jude Medical chief operating Michael Rousseau said: "Physicians need a range of options to effectively treat chronic pain, and our acquisition of Spinal Modulation is part of our ongoing commitment to providing physicians new and innovative therapy options.
"Dorsal root ganglion stimulation with the Axium system is highly complementary to our current chronic pain product portfolio, and acquiring this technology will further our ability to partner with physicians to reduce the burden of chronic pain."
In December 2014, Spinal Modulation completed enrollment in its Accurate US IDE trial for the system and submitted PMA application to the FDA in support of marketing approval in the US.
St. Jude noted that it will become the only medical device manufacturer to offer radiofrequency ablation (RFA), spinal cord stimulation (SCS) and dorsal root ganglion (DRG) stimulation therapy solutions to treat chronic pain, once the deal concludes.
Subject to customary closing conditions, the deal is expected to be completed in the second quarter of this year.
Image: St. Jude Medical’s global headquarters. Photo: courtesy of St. Jude Medical, Inc.