Press release from Business Wire
Covidien Announces Definitive Agreement to Acquire BÂRRX Medical, Inc.
Monday, November 21, 2011
Covidien Announces Definitive Agreement to Acquire BÂRRX Medical, Inc.09:00 EST Monday, November 21, 2011 DUBLIN (Business Wire) -- Covidien (NYSE: COV), a leading global provider of healthcare products and a world leader in advanced energy-based devices, today announced a definitive agreement to acquire BÂRRX Medical, Inc. BÂRRX is the leader in treatment of Barrett's esophagus syndrome using bipolar radiofrequency (RF) ablation devices. Covidien will acquire all of the outstanding capital stock of BÂRRX, a private company, for approximately $325 million, with future earn out payments possible based on achievement of specific milestones. The transaction, subject to customary closing conditions, including receipt of certain regulatory approvals, is expected to be completed by January 31, 2012. This acquisition is consistent with Covidien's strategy to expand into adjacencies and invest in product categories where it can develop a global competitive advantage. The acquisition of BÂRRX will expand Covidien's ability to treat gastrointestinal diseases, such as Barrett's esophagus. Barrett's esophagus syndrome is a precancerous condition of the lining of the esophagus, often a precursor to esophageal cancer and often the result of gastro esophageal reflux disease. Left untreated, Barrett's can lead to esophageal adenocarcinoma, a cancer with less than 15% five-year survival. BÂRRX's HALO90, HALO90 ULTRA and HALO360+ ablation catheters, driven by the HALOFLEX ablation system, provide a uniform and controlled ablation effect that removes diseased tissue and allows re-growth of normal cells. “BÂRRX Medical products and technology complement our current portfolio of energy-based products and will broaden our presence in the global gastrointestinal market,” said Bryan Hanson, Group President, Surgical Solutions. ”At the same time, patients will benefit from advances in RF technologies that will change the standard of care for esophageal diseases from invasive surgery to therapeutic intervention. Covidien offers advantages to BÂRRX Medical that support its mission in long-term growth and value to patients. We expect to leverage BÂRRX technology and capabilities as a platform to accelerate global expansion.” “We are extremely pleased that Covidien has elected to acquire BÂRRX, as this should allow us to accelerate the worldwide adoption of our evidence-based endoscopic therapy for patients with Barrett's esophagus,” said Greg Barrett, President and CEO, BÂRRX Medical. “Dozens of clinical trials and over 65 peer-reviewed publications have demonstrated the safety and effectiveness of our devices for treating esophageal disease, and over 90,000 procedures have been performed. We look forward to this acquisition to enable the clinical trial evaluation of the HALO system in other portions of the gastrointestinal tract as well.” Assuming a January 2012 closing, Covidien does not expect this transaction to have a material impact on its fiscal 2012 sales, operating margin or earnings per share. Once the transaction has been completed, Covidien will report the BÂRRX Medical business as part of its Energy product line in the Medical Devices segment. Supporting materials are now available on the Investor Relations section of Covidien's website: http://investor.covidien.com ABOUT COVIDIEN Covidien is a leading global healthcare products company that creates innovative medical solutions for better patient outcomes and delivers value through clinical leadership and excellence. Covidien manufactures, distributes and services a diverse range of industry-leading product lines in three segments: Medical Devices, Pharmaceuticals and Medical Supplies. With 2011 revenue of $11.6 billion, Covidien has 41,000 employees worldwide in more than 65 countries, and its products are sold in over 140 countries. Please visit http://www.covidien.com to learn more about our business. FORWARD-LOOKING STATEMENTSThis release contains forward-looking information about Covidien's proposed acquisition of BÂRRX Medical, Inc., the timing of the anticipated transaction, the potential benefits of the anticipated transaction, BARRX's clinical trials, products and product candidates and the potential benefits of such products and product candidates, and expected dilutive effect. Any forward-looking statements contained herein are based on Covidien's and BÂRRX's management's current beliefs and expectations, but are subject to a number of risks, uncertainties and changes in circumstances, which may cause actual results or actions to differ materially from what is expressed or implied by these statements. The factors that could cause actual future results to differ materially from current expectations include, but are not limited to, the satisfaction of conditions to closing the agreement; the ability to successfully integrate BÂRRX's operations and programs with Covidien's and the time and resources required to do so, the uncertainties inherent in commercial, research and development activities, decisions by regulatory authorities regarding whether and when to approve any applications for such product candidates and other matters that could affect the availability or commercial potential of such product candidates; and competitive developments. These and other factors are identified and described in more detail in Covidien's and BÂRRX's filings with the SEC. We caution investors not to place undue reliance on the forward-looking statements contained in this press release.We disclaim any obligation to update these forward-looking statements other than as required by law. CovidienEric Kraus, 508-261-8305Senior Vice PresidentCorporate Communicationseric.firstname.lastname@example.orgBruce Farmer, 508-452-4372Vice PresidentPublic Relationsbruce.email@example.comColeman Lannum, CFA, 508-452-4343Vice PresidentInvestor Relationscole.firstname.lastname@example.orgTodd Carpenter, 508-452-4363DirectorInvestor Relationstodd.email@example.com